How much does an inside sales manager make? If you’re climbing up the ladder and eyeing that sales manager role, what pay could you expect?
According to a survey conducted by PayScale.com, inside sales managers in the United States receive an average annual pay of $54,916–the average including spiffs, bonuses, profit sharing and commission. However, it does not include equity (stock) compensation, cash value of retirement benefits, or the value of other non-cash benefits like health care. The average compensation received outside salary can reach $31,270. The highest average compensation recorded last year was a base pay of $96,866.
For select industries, base pay is reported to reach north of $150,000.
So, since the pay is really varied, it’s interesting to look into what affects inside sales managers’ salaries.
First, let’s clearly define what an inside sales manager does.
What do inside sales managers do
Inside sales managers oversee inside sales teams to ensure that contracts are closed in line with definite monthly goals. From there, the inside sales manager is also in charge of ensuring that the what’s promised is delivered to clients.
Here are some particular tasks inside sales managers are expected to be capable of doing:
- Manage a team of inside sales professionals
- Take over sales calls as needed
- Facilitate and introduce new technology, processes, techniques and methods to make sure that the team’s capabilities are in line with what situation require to reach company goals
- Coordinate different company departments to ensure the efficient rollout of new tools, techniques and communications
- Collaborate with sales enablement, marketing, support, community management, admin, product management and account management to create and polish messaging, campaigns and programs
- Be on the lookout for improvement opportunities for inside sales teams
- Ensure sales teams’ compliance with company rules and statutes
- Take part in client communication to ensure customer satisfaction and effective sales management and leadership
- Keep sales teams accountable by ensuring reporting and communication is frequent and open
5 factors that affect inside sales manager salary
In this post, I will talk about what factors influence the base salary and total compensation inside sales managers get.
The salary for someone with the title Inside Sales Manager will vary depending on a number of factors including industry, company size, location, years of experience and level of education.
With the internet permeating the world of business, most industries need the expertise of inside sales managers to look over their inside sales teams. From healthcare, marketing automation, enterprise software, information security, to agriculture training to education tech, there is a place for inside sales teams–therefore. opportunities for inside sales managers are abundant.
That said, the salaries of managers vary greatly even within industries as much as they vary in job description and qualifications. It all depends on the firm. However, there are some trends we can pull insights from.
Companies that sell SaaS or software-as-a-service are sprouting up. With the subscription based model, they need to constantly onboard new customers to spur growth–especially because these companies are mostly tech startups.
According to Recruiter.com, sales managers tend to make the most in the following industries (with averages)
Professional, Scientific, and Technical Services – $137,940
Finance and Insurance – $133,430
Information – $131,960
Wholesale Trade – $127,780
Agriculture, Forestry, Fishing and Hunting – $124,300
Management of Companies and Enterprises – $121,410
In general, inside sales managers earn less within the industries below (with a
Accommodation and Food Services – $75,100
Public Administration – $86,140
Retail Trade – $87,740
Arts, Entertainment, and Recreation – $90,860
Other Services (except Public Administration) – $93,530
Administrative, Support and Waste Management Services – $99,180
Inside sales manager salaries are dependent on firms but there are also notable differences in the pay scale depending on the region and size of the city an inside sales manager is working in.
Salary.com has higher numbers than PayScale.com.
According to them:
The median annual Inside Sales Manager salary is $76,683, as of February 22, 2016, with a range usually between $66,657-$92,125 benefits not included.
Someone from Atlanta, Georgia can expect $96,708 in salary and benefits while someone working in Honolulu, Hawaii as an inside sales manager can expect $104,091 in salary and benefits. In smaller cities like Waco in Texas, inside sales managers get an average of $86,984 according to Salary.com.
Why do wages vary in different geographical locations?
The main driver is cost of living. From minimum wages to hourly averages, the cost of living affects salaries. Rent, food, healthcare and transportation expenses vary widely depending on the city.
Major metros like Chicago, Seattle, New York and Dallas have high costs of living compared to smaller cities like Waco, Cleveland and Oklahoma city.
Let’s see. The average rent for a New York apartment is around $3000 a month, usually split between several people. New York also has income taxes, cutting down the $113,067 average salary to a much lower number. In a city like Waco, the average rent for a two-bedroom house is around $700.
While cost of living is a huge driver of salary ranges, it should also be noted that inside sales is a largely a tech firm profession, meaning it makes sense for cities with more developed tech scenes to have a higher salary for inside sales managers. San Francisco, arguably the most tech-savvy city, pay an average annual salary of
$117,095, that’s a couple thousand more than New York, a tech city on its own.
More opportunities and better pay wait for inside sales managers in major cities–but the competition is also fierce. Companies sashay their competitive compensation packages to get the best inside sales professionals in the market. The startup scene is continuously booming and there’s a movement toward non-tech professionals entering the tech scene through sales positions. However, inside sales manager need substantial sales experience to be even considered making the track to this profession still largely centered in sales. Compared to inside sales reps, veterans might get the upper hand. Learning skills fast is priceless and getting the hang of tech processes, agile methodology, and industry ideas is mostly better regarded for reps, but leadership and analytical skills is key for managers.
To many hiring departments, an ideal sales manager is one who knows not only the product inside out. A sales manager that’s paid the most is one who is a veteran of the industry. They have insight to share. They keep themselves abreast with industry updates and relevant information that they can share with their team regularly. Inside sales managers who are very knowledgeable in their vertical are able to grow the knowledge of their whole team. This helps sales teams be equipped for any situation that arises in the sales floor.
However, when hiring inside sales managers, the salary isn’t always dependent on the experience. There are many inside sales managers who are working in other industries that can still bring immense value to a sales organization. This impacts the salary structure. Inside sales managers who are transplants from other industries may get an initial salary bump at the end of a three to six-month familiarization period where they’re expected to be in a consultative position, learning all they can about the industry while identifying weak points in the company’s sales process.
Many organizations focus on medium to long-term success when hiring sales managers. A good salesperson may not have the right skills for a managerial position. However, the salary of an inside sales manager is always higher than that of the reps while also taking into consideration the potential lift commissions bring to reps’ salaries..
It’s not automatic that an inside sales rep with lots of years of experience gets managerial positions. What’s often measured is the problem solving skills and sales perspective of an inside sales manager.
When recruiting sales managers, organizations have developed their own models to measure competence against. Bigger enterprises have invested considerably in ensuring that the sales leaders they hire are capable to do the job as written in the description. Generally, bigger companies are stricter in their screening and would require a long experience of success in inside sales.
Good salespeople are not automatically great sales manager. Getting into the meat of their managerial skills can sometimes be tricky for hiring managers who are considering to hire star sales reps. Good sales reps rarely translate their skills into management–but many organizations still hope that their sales success as reps will rub off on the teams these reps will eventually manage.
Of course, market and industry knowledge are both indispensable and crucial when hiring sales managers. However, the ability to bring the best out of others and motivate continuous growth in sales teams is more valuable in managerial talent.
The best gets rewarded
Sales hiring is tough. I’ll let Trish Bertuzzi of BridgeGroup Inc. do the talking:
“I don’t think anyone would argue that the quality of the executive who leads your Inside Sales team makes or breaks its success.
Hiring great people is easy, well not really, but hiring people who will perform greatly is spectacularly hard. If you hire someone with the wrong skills, you’ll pay for it. When defining the profile of candidate you need, think through are we looking for someone to manage an existing process or create process from stratch?
In this fast-paced sales world, you don’t have the luxury of making the wrong hire.”
The compensation that comes with the set of skill each potential hire can attract varies so much but an excellent sales manager who can show ability to add to a company’s bottomline will surely be well rewarded.
FREE WHITE PAPER: The Impact and Opportunities of Account Based Marketing for B2B Sales Teams
Read on about how you can take a more calculated approach to sales and exceed your goals.
Latest posts by Dan Sincavage (see all)
- Nextiva and Tenfold Partner to Bring Unified Communications to CRM - June 29, 2020
- Is your sales team engaged, accountable and productive as work shifts remote? How Tenfold & Salesforce High Velocity Sales can make sure you don’t miss a beat - April 8, 2020
- Tenfold Powers Salesforce High Velocity Sales (HVS) with Native CTI for more than 100 voice platforms - April 6, 2020