Inc.com offers a short article titled Employers Focus on Worker Retention. The takeaway graphs (emphasis mine):
Small businesses are focusing more resources on employee-retention plans, rather than recruiting efforts or new benefits policies, a recent survey found.
Of 241 small-business executives surveyed nationwide, 21 percent said they have expanded training and professional development to boost employee retention, while 80 percent said they considered their salaries “as competitive” or even “more competitive” than larger competitors, according to Employco, a Westmont, Ill.-based business services firm.
Salary is a natural point in which it compete with larger companies. Most small companies are not constrained by salary slotting for specific positions as is the case in large companies. Paying more in sales is always a good retention strategy. The key is to ensure that you are paying for the right salesperson.
I would offer that sales hiring in small companies is more mission critical than in larger companies. The reason being that a bad sales hire at a small company can jeopardize the entire company. A bad sales hire in a large company can survive under the radar for some time before being discovered (unfortunately we have seen this phenomenon on numerous occasions).
In any sized company, lost opportunities are the largest risk with the least amount of measurability. One bad sales hire can cost a company far more than they will ever fully know.