on their performance against predefined quotas. A commission of a specific amount is paid for achieving a quota, in addition to the fixed salary.

As it is based on the value of sales made, the relative commission is appropriate for high value-added products. Conversely, for the acquisition of new customers with lower basket sizes, the absolute commission is recommended.

Commission on territorial volume
This model calculates compensation based on the volume of sales achieved in a specific territory. Revenues are added together and commissions are shared equally between all salespeople involved. Releasing individual pressure to perform, this configuration instead emphasizes team spirit and mutual assistance.

The problem is the potentially unequal distribution

of effort within the team, with equal compensation regardless of individual contribution .

Linear commission
A linear commission pays a salesperson usa people whatsapp number based on the percentage of completion or exceedance of their individual quota. An employee who meets 80% of their target will receive 80% of their commission, or 110% if they exceed it by 10%. This model offers attractive and fairly fluid incentives, but it can lead to high and unpredictable costs for the employer.

Gross Margin Commission
This system focuses on the profitability of the sale rather than on the revenue, by taking into account the direct costs of sales. This allows a better “business” reading of the profit linked to a sale, and discourages salespeople from resorting too much to discounting to reach their quotas.

Questions to Ask Yourself When Setting Up Your Compensation Plan
When writing and then posting your recruitment ad, a few essential questions arise.

A good compensation system is fair

equitable (providing equal opportunities for success to everyone) and understandable to the entire team.

To make the system readable, it is important not to set more than 4 or 5 objectives (quantitative as well as qualitative), and to communicate extensively on the commissioning plan.

Furthermore, it is necessary to ensure Sad Life Box alignment between the company’s success indicators and the remuneration of sales representatives.

In short, expectations must be clear and stimulating, and individual reward must come through collective success. In this context, it is important to give your entire team the same tools to achieve their goals. The weapons? We are thinking here of the many prospecting tools or the use of LinkedIn for social selling.

Not all of your salespeople are equal when it comes to these tools, so it may be important to set up internal training or use a growth agency to supply your salespeople with leads and then only measure their performance in their ability to close these deals.

Is your compensation plan motivating for all your salespeople?
The plan must satisfy the entire team, from recent recruits to the most veteran elements. It must include the different scenarios according to personal situations, and not penalize anyone. It must maintain a high level of motivation of the workforce at all times of the year, whether the pipeline is full or empty.

Are pay gaps representative of performance?
Still with a view to using a fair and motivating plan, it is necessary to ensure that the pay gaps are justified by differences in performance. The strong culture of acquired knowledge in France and the propensity for discontent sometimes push companies to attenuate pay gaps, which seriously harms the incentive to outperform.

 

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