I know that there’s no simple answer to this, but what should one expect in terms of Sales commission?

I’ve just worked mine out to be between 2% & 3% of my target number for 2017. I’m in IT sales, with a 2016 probation year that didn’t go my way (46% to target, perhaps I should be grateful I still have a job).

For a company to pay 2-3% to a Sales rep, is that not a bit stingy? Or is that right?

The think that irks me its that I’d have been paid the same amount of money last year for 100% of my target which was 1/3rd less aka 3.6% approx.

There’s a catch – That extra 3rd is “renewals” or in other words seen as “easy” sales for customers already embedded with us, maybe that’s why its skewed?

Or is it a pay cut in disguise?

The last time I looked at a job in sales it was 2.5% up to target and 3.5% (IIRC) above. That was selling units that cost £100k and target would have been around 10 pa (this was a few years back mind…)

What did you agree to before you took the job? I’ll assume you had an idea of how likely you were to meet target and therefore your total package.

The real kick up the arse will be when they pay it to you in Air Miles.

What did you agree to before you took the job? I’ll assume you had an idea of how likely you were to meet target and therefore your total package.

I was technically made redundant and the OTE for 2016 – which I haven’t earned of course – matched my old position, same company. I say technically because I wasn’t consulted, just “moved”. I didn’t argue as I thought I’d be earning the same wages. Now in year two, I’m being asked again to formally accept my plan in the ‘puter system and I’ve done the maths…

The real kick up the arse will be when they pay it to you in Air Miles.

Quite, I have a flying phobia 😀

Quite, I have a flying phobia

Yeah, I know. 😀
What was the fallout from ditching your flight to the States?
Also, How’s the mouth?

(Genuine concern and , unusually for me, not an excuse to rip the piss )

I have been in field based B2B sales for years. In my experience every company has a different way of working out commission payment. Some you have to hit targets to get, others work on a straight percentage figure. Even the percentage figures can be based on turnover or profit. Also depends on the basic salary too. If the commission is target based then it depends how achievable the targets are.

So as you said there is no simple answer – just make sure the commission scheme suits you and your lifestyle.

Nothing to add to sales commission discussion , but i reckon your on the back foot for negotiations after missing target and then missing the company soiree in the states,

What was the fallout from ditching your flight to the States?
Also, How’s the mouth?

Genuine thanks for asking. No idea about the former I’ve a “annual plan” meeting later im the week, i’d expect it to be raised as a side issue. I have however started using the company avialable counselling service etc and been to the GP so,its official that its not BS. My face has reduced about 90% – I’m seeing a specialist tomorrow night.

Trail rat – agreed no doubt about that. This post is a about being treated fairly, not wanting to be Gordon Ghekko.

Jason, forgive me not responding but currently my life is about revisiting mindfulness and modern minimalism after an anxiety attack, so my lifestyle expectations are rapidly changing!

Hope it goes well for you. Good luck with it.

Depends totally on the product margin imo. In my business (finance) renewals pay much less than new business.

As Jason said above it depends on so many factors. I was paid 1.5%-3% of the full system sale price; 1.5% up to target and 3% on all sales over target

In my current company sales people are paid a higher percentage, but it is only based on the profit/margin of the deal

TBH as a ‘new’ salesperson, the OTE is generally the figure that is supposed to impress you. The reality is often lower. Once you are established in sales you negotiate your package at the outset. Traps include things like what happens to your commission if the client defaults on payments

For a company to pay 2-3% to a Sales rep, is that not a bit stingy? Or is that right?

How can one answer that without knowing your target?

$100k, $1m, $10m?

Our sales team get a basic commission payment up to target e.g. 1.5% up to $5m and then an increased rate for anything over target e.g. 3%. Basic is probably about $100k.

(Genuine concern and , unusually for me, not an excuse to rip the piss )

Well, you got it all out of your system in your previous post 😉

As the other posters have said, it depends on the margins, the £ size of the sales and the company. It’s been between 1-10% on the different companies I’ve worked for over the years. Bigger commission on the smaller companies and smaller on the very big established companies.

Nothing to add to sales commission discussion , but i reckon your on the back foot for negotiations after missing target and then missing the company soiree in the states,

That’s helpful.

Our sales team get a basic commission payment up to target e.g. 1.5% up to $5m and then an increased rate for anything over target e.g. 3%. Basic is probably about $100k.

So they earn $175k / £130k OTE – at what level of experience?

Traps include things like what happens to your commission if the client defaults on payments

We only pay commission on revenue, not on orders booked, so if the customer has 180 day payment terms (not uncommon with big multi-nationals), the commission is also on 180 days…

Traps include things like what happens to your commission if the client defaults on payments

We only pay commission on revenue, not on orders booked, so if the customer has 180 day payment terms (not uncommon with big multi-nationals), the commission is also on 180 days…[/quote]

Yup. We had a 30% on receipt of order and the remainder on successful installation or receipt of the final payment.

I used the word ‘traps’, but ‘terms’ would have been better because it is in the companies interest to get the best deal and not pay the sales force regardless of what happens once the ink dries

There’s no such things as a standard commission rate

It depends on the base cost, brand, marketing, type of sale, sector, level of expertise to sell, type of people involved in the sale etc

Even with IT it would vary. Being the lead sales person in a multi-million dollar bid vs selling a few peripherals

Is your commission based on MArgin or revenue, 2 massive differences there. If margin, then anywhere from 10-40% + of the margin target, wage wouldnt be taken into account.