Learn About the Types of Commissions in Sales Jobs

Learn About the Types of Commissions in Sales JobsLearn About the Types of Commissions in Sales JobsWhen people start looking at abverkauf jobs, they often assume that theres a commission involved but thats not always the case. Many abverkauf jobs do include a commission. Some pay only commissions some offer a commission but also pay a set cousine salary and some dont pay any commission at all. No Commission Many retail sales jobs dont pay any commission, especially for new salespeople. The associate is paid a flat salary regardless of how much or how little they sell. This salary-only type of job can be comforting to a new salesperson since your income isnt dependent on how well they sell, but it can quickly become frustrating. Many salespeople are money-motivated, so if theres no ongoing incentive for selling well, theyll either find a new job or stop trying. Base Plus Commission Sales jobs offering a base and a commission can offer the best of both worlds. Salespeople are rewarded appropriately for successful sales but dont have to worry about starving if they have a bad month. Often the commissions wont kick in until the salesperson reaches a specific goal, such as a certain number of sales or a minimum revenue amount for the period. Most of these positions pay out commissions throughout the year, often on a quarterly or monthly basis. However, some employers will set up a base positiv bonus schedule instead, in which a salesperson wont receive anything above his base salary until the end of the year. Bonuses are typically based on meeting or exceeding certain preset goals, but these may not all be directly sales-related. For example, the bonus might be partly based on customer feedback. Commission Only Pure commission sales jobs are just that the salespeople are only paid according to what they sell. If a salesperson makes no sales for a month, he doesnt get paid. However, successful salespeople tend to make a lot more money with a pure commi ssion job than with the equivalent base plus commission job. Some pure commission jobs offer a safety net in the form of a draw against commission. The company pays its salespeople a set amount at the beginning of each period. At the end of the period, this prepayment is deducted from however much the salesperson earned in commissions. If the salesperson earns more commissions than he was paid in the draw-down, he keeps the extra money. But if he earns less in commissions than his draw-down, he must pay the remainder back to the company. Types of Commissions In commission only or base plus commission jobs, the commission can be calculated in two basic ways straight or variable. Straight commissions are calculated as a set percentage or amount per sale. For example, if youre selling cars you might receive a commission of 10% of the sales price for each car you sell. If youre selling gym memberships, you might be compensated a flat $25 per sale. Variable commissions are a bit more complicated, changing as you reach certain goals. For example, someone selling cars at a different dealership than the above example might make 5% on the first ten cars he sells within a given period and 15% on any cars he sells after the initial ten. In rare cases, a sales job will also pay residual commissions. This means that the salesperson will continue to receive commissions as long as a given account is active. Residual commissions are occasionally offered in insurance sales, for example as long as a client keeps paying premiums, the salesperson keeps getting compensated. Whats Right for You? A brand-new salesperson would probably be best off in a base plus commission job. That gives her a little breathing room while she learns the ropes and gains experience, yet offers a higher level of compensation as she gets better at selling. Experienced salespeople tend to focus on making as much money as possible, so they often prefer commissions-only positions. A really good sal esperson in a pure commission job can make a great deal of money, particularly in a job where shes selling high-end products and services.