Hi, We are a start-up software company, that sales software for facial image analysis (.e.g., face recognition). I am looking for sales people, and I want to compensate 100% based on their sales. I thought to compensate as follows: 1) If they find potential costumers and I close the final deal, then I give them 5% of sales. 2) If they finalize the contract with the company, then I plan to give them 15% of net sales. Does it makes sense? Thanks
Salespeople receive a salary, but also a bonus if target quotas are met. There is more incentive with this approach, but once again, good salespeople may prefer being paid a commission for each sale. Salespeople receive a fixed annual salary, so they have a predictable cash flow, but also receive a commission on sales. Under this plan, there is no base salary, so salespeople are compensated only on sales. Pay is not tied to hours worked, so some salespeople may have to work more hours to generate enough income. Although this plan is based on commission, salespeople receive a draw each pay period to help with their personal cash flow. Under this plan, salespeople may receive an initial commission for a first sale and perhaps a smaller commission if the customer continues to order.
You can read more here: https://www.thehartford.com/business-insurance/strategy/sales-team/sales-compensation
Besides if you do have any questions give me a call: https://clarity.fm/joy-brotonath
Answered 3 years ago
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