 Re: Sales Rep pay structure
Want somebody to sell? Higher commission works but forget the salary. Easy for me to say but having been there, done that and then owning my own biz, it works.
We pay 60% of gross profit! That's high but it makes the salesperson hungry, hungry for sales and weeds out the ones willing to discount to get the sale. I look at it as all plus business that he brings in and so it's well worth it to pay him well.
In a major market our guy sells just under $600.000 at 34% gross. He sets his hours, pays expenses (if you pay, people are more willing to spend your money) and he works every minute he wants to. He's working with us, not for us because he is treated well and makes a lot of money for what he does. Could we pay a lower percentage? Sure. I don't want to mess with success having been on the outside side of the equation so I paid it high to make sure we got a pro representing us.
He's an independent contractor which helps with lots of employment issues and hustles his butt off. All we're doing is giving him the credibility of an established business and behind the scenes organization to make his sales smooth, quick and profitable.
Pay somebody an hourly/weekly and comm. and you'll get some sales, some headaches, and deal with all the issues of an employee.
Lots will now jump on here and tell you why this doesn't/won't work or how to tweak it. Just telling you from my 25 years of selling on only commission and having my own biz for 16 years, this worked best for me and now works just as well for an 'outside' salesperson.
Good luck and Good Selling! | 
Sales Rep pay structure 
Except mine....
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