Sales Commissions: A Complete Guide on How to Define and Structure Your Team's Pay

[zihadhasan012]

Many marketing management professionals strive to generate more and more leads so that the sales team can convert them into closed deals and, consequently, revenue.

And this is all very well, but it is not the only important thing: it is also key to define sales commissions , as it is one of the main elements of motivation, which tells sellers that the more customers they bring to the business, the more money they will earn!

But what are the important points in defining this commission? And what are the main types of commissions that can be given to sellers in today's market?

To answer these and other questions, we have written this guide and we invite you to read it until the end.

What should be taken into account when setting up the sales commission model and process?
What are the types of sales commissions?
What should be taken into account when setting up the sales commission model and process?
To choose the commission model that will be applied in your company, you must make some considerations. Below we point out the main ones.

Company objectives
Before determining what type of commission you will offer to your salespeople, you need to establish what goals the company hopes to achieve in the short, medium and long term.

In this way, each salesperson will know that, beyond pursuing a commission, he or she must strive to achieve the objectives necessary for the business and that financial stability will depend on this, in addition to the delivery of greater and better incentives.

Rules
Next, you need to determine what the sales rules and commissions will be. This step is very important so that everyone is aligned and knows clearly how much they need to sell and how much they will earn from it .

Seasonality
If your business has periods where sales costa rica phone number list may increase or decrease, it's a good idea to consider these when determining your sales commission.

For example, during peak demand times, you may have a different commission scheme due to high sales volume, while you may increase incentives at historically challenging seasons to close deals.


Period between sale and payment
This point is of utmost importance for the financial health of the company. There are cases where the commission is paid to the seller at the time of the sale and others where it has to wait until the following month or wait for the purchase payment to reach the cash register first.

Knowing which of these models is most suitable is also an important part of the commission selection process.