How to Plan Commission Duties
The rules are hard and fast when it comes to planning commission duties for a sales force. You need to consider the amount of profit your company needs and how many calls each salesperson needs to make to achieve those sales, what kinds of compensation plans will motivate a talented sales team and what daily processes will provide the kinds of margins the company must have in order to grow.
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Instructions
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Plan a training program for new salespeople. The program must include enhancing product knowledge as well as general sales training. Salespeople expect to make the bulk of their earnings from commissions, but also will devote the time and energy into learning about the company if they are paid a minimum base compensation. Keep the base compensation in place to cover the continuous training needed by sales staff.
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Research comparable commission pay plans and duties used by other companies in your area. While you don't have to follow the exact plans of other businesses to attract the best talent, you need to know what the competition is paying and the procedures they follow to remain competitive. Use the knowledge as a guideline rather than a pattern on which to base your own commission programs.
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Create a comprehensive list of administrative duties that salespeople must perform to retain their jobs and earn their base pay. These duties may include invoicing the customer, arranging deliveries, sending follow-up marketing materials and maintaining a database of customers and potential clients. Salespeople should plan on attending regularly scheduled sales meetings and training sessions as needed.
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Build a draw commission plan if you prefer not to pay a base salary to salespeople. A draw is a guarantee a salesperson will take home each week, which is balanced against future sales. The salesperson only receive additional income when they make sales over and above the limit of the draw. Once the draw is met each week or month, the salesperson receives 100 percent of the commissions earned. Paperwork and customer follow-up duties can be included in the job description that covers the draw policy as well.
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Tips & Warnings
Offer bonuses on a regular basis to keep a commissioned sales staff motivated. Salespeople are competitive and thrive in environments that provide monthly contests or incentives in addition to their base salary and commissions. The bonus can be based on the total amount of sales or a prize to the salesperson who had the best follow-up responses each month.
Be careful about setting a cap on the amount of commissions a salesperson can earn. If you happen to hire a very talented sales professional who makes incredible sales while completing all assignments, a cap on commissions can be a big disincentive for the person to work to her maximum potential.
