Sales Managers: Hot Property

Lubricant sales and marketing managers can count themselves among the best-paid professionals in the United States, according to a recent survey by LubesnGreases magazine. Over 200 sales and marketing managers responded to the publications exclusive 2018 Lubricants Industry Salary Survey, and they reported taking home an average $150,429 a year - 7 percent more than the $140,413 shown in its 2016 survey.

With the top response in the current survey weighing in at $390,000, its possible that a few highly compensated individuals may have lifted the 2018 average. So another important measurement to consider is median pay: Median pay for the 221 qualified participants was $133,000, meaning half of all respondents earn more than that and half make less. The median reported in 2016 was slightly lower, at $131,000.

How do those figures compare with the rest of the U.S. workforce? Data from the federal Bureau of Labor Statistics indicate that median pay for all U.S. workers last year was just under $38,000, while for those in management occupations it was about three times that. So with their median of $133,000, lube sales and marketing pros appear to be comfortably ahead of the pack.

This is the tenth time since 2000 that LubesnGreases has surveyed lubricant professionals in three job categories (plant manager, sales and marketing managers, and lab/technical managers). Each biannual survey taps a fresh pool of participants who differ from the prior time, so no direct up-down comparison should be made, the magazines editors remind. If the findings go up, it does not prove that compensation has climbed for everyone. It just means that the current cohort reports making more than the prior group.

The typical sales and marketing manager who answered this years survey is 52 years old and has over 22 years of industry experience, including almost 13 with their current employer. The sales and marketing respondents included 18 women (8 percent of the participants).

Sixty-one percent of all respondents are individuals working for lubricant manufacturing companies, the rest for lube distributors. Sales managers with manufacturers said theyve held their current position for an average of six years and supervise eight people; its 10 years of tenure and nine direct-reports for those with lube distributors.

The pay gap between lubricant manufacturing companies and lubricant distributors has been a standout difference in past salary surveys, and this years sales and marketing respondents carried on the tradition. The median pay for respondents who work for lubricant manufacturers was almost $150,000, but $115,000 for those at lube distributors.

That difference is due in part to who youre calling on, suggested Curt Knapp, chief operating officer in Omaha, Nebraska, for Warren Distribution, one of the countrys largest lubricant manufacturers with four blending plants and around 765 employees. Generally, lube blending companies are calling directly on the principals of large organizations, while distributors tend to have fewer large accounts and their people are calling on the mom-and-pop outfits up and down the street.

Loren Perez, an executive search expert with Energy Recruiters Inc. in Atlanta, remarked, Definitely, both have been increasing pay over the last couple years, but typically we see blenders offering a larger base salary plus a bonus, while distributors more often offer their sales people a smaller base salary plus commission on gross profit. Still, its not unusual to see a distributor sales rep get $90,000 plus bonus, while the sales manager makes $150,000 plus bonus.

The compensation we see offered by distributors typically is about 10 to 20 percent behind what lube manufacturers offer, confirmed Ken Pelczarski, principal at placement firm Pelichem Associates in Downers Grove, Illinois. Distributors usually are working on tighter budgets, and they have more of a customer-facing role. So on money alone, they cannot compete with the blenders or additive or base oil companies for the top candidates. Those kinds of companies demand a broader skill set and greater technical knowledge, so a less experienced person may hesitate to go that way. But they still can do very well on the distribution side.

Asked if theyd received a pay raise in the past 12 months, two-thirds of respondents with lubricant manufacturers said yes, but only 46 percent of those with distributors. Optimistically, 68 percent of all respondents say they expect to pocket a bonus this year. And a bit more than one-third say that commissions are part of their pay packet.

What else makes a difference on payday? These factors do, the survey found:

  • Employer Size. Simply put, pay rises with company size. Median pay for sales and marketing managers ranged around $110,000 to $112,500 for those working at companies with 50 or fewer employees, rose to $150,000 at companies with 201 to 500 employees, and peaked at $180,000 at the biggest lube organizations having 501 or more on staff.
  • Number Supervised. As youd expect, both lubricant manufacturers and distributors reward more richly their managers overseeing a larger staff. Sales and marketing managers with five or fewer people under them made $145,100 at manufacturing companies and $99,800 at distributorships. That rose to a respective $181,800 and $142,900 for managers with six to 12 direct-reports, and topped out at $204,800 and $180,000, respectively, for supervising more than 12 people.
  • Geographic Area. Pay for sales and marketing managers is competitive everywhere. But for a shot at the top tier of pay, applicants may want to head to the Southwest. The average reported there was $167,500 a year (median: $155,000). The U.S. region reporting the lowest average pay is the Northwest, with $128,000 a year. That region also had the lowest rate of participation in the survey.

Every region is feeling the worker shortage, said Curt Knapp, and that includes Warren Distributions blending and distribution facilities in Iowa, West Virginia, Alabama and Texas. Everywhere we operate around the country, were seeing the same competition for hiring in manufacturing and distribution. Its particularly tough in the Omaha metro area, where unemployment is virtually nothing. In West Virginia, the job market is impacted by the fracking industries, and that puts pressure on hiring. In Alabama, were a little insulated because our plant is in a more remote area, about an hour and a half from Birmingham, so that works in our favor. But in Houston we have the same challenges as everyone.

With U.S. unemployment levels at their lowest in 49 years, recruiters advise that the best candidates will expect an offer to include higher pay, an appealing workplace and kid-glove treatment.

Its not enough to paint a picture of future opportunity, that wont move a candidate now, said Perez at ERI. Previously, the candidate had to sell his or herself-today, the employer has to sell itself. We see employers listening more and taking care of their employees to keep them. Still, there are lots of folks retiring and new people moving in, so opportunities are out there.

Pelichems Pelczarski said hiring by lubricant and additive companies has picked up significantly, with a positive impact on pay for all, from hourly workers through upper level managers. Hes even seeing workers talk their own companies into a pay raise, rather than risk losing them.

Things have been trending this way for a while. Last year also was strong, but Id say this year is definitely stronger.

More findings from the salary survey can be found in the October, November and December editions of LubesnGreases magazine, and the complete 2018 Lubricants Industry Salary Survey report will be available as a digital PDF for $125 starting Nov. 26. As well, the data set for each professional category (plant manager, sales and marketing, laboratory/technical) may be purchased individually after that date for only $50 each. To order, visit www.LubesnGreases.com and select Data Products.