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Measures
How do we compensate for high margin and low margin sales in the same compensation plan?
It may be possible to combine the two types of sales using margin value as the measure, or it may be necessary to create two separate incentive components…
We want to pay on both revenue and margin – how do we do that?
Often in manufacturing companies, sales people influence both the volume of sales and their relative profitability, rewarding simultaneously for both puts the incentives in line with what’s best for the company.
How should we build a payout table for very small goals, or goals that could go negative?
If a small business had a business plan that included an operating loss of $200,000 for the year, putting together a payout table to reward for this “success” would not work if the mechanics were communicated as a percent of the goal…
Sales Manager Comp – Sales Rollup or Management Plan
After the incentive plans for sales representatives are completed and modeled, the next step in a plan design project is to develop plans for the front-line Sales Managers. Companies generally take one of three approaches based on their pay philosophy.
Hiring your first sales person
For early stage businesses, your first sales hire is hard to do well. You don’t have a sales leader to help you confirm you have the right skills and temperament for the job. You’re not sure what to expect in terms of productivity…
How to pay for “sales” in a freemium model?
We have a sales role with the job of helping existing customers get better value from our service – but “success” will not result in a contract or a specific sales event. How do we comp for that?
Keys to Success: Six Areas to Address in Your Next Sales Compensation Plan
Workspan, August 27, 2010 — It’s fall again, the economy appears to have shifted toward the positive in many sectors, and companies are thinking about redesigning their sales compensation plans for 2011. In order to ensure the redesign process and resulting plans will provide a good return, businesses should address six key areas.
A compensation architecture balances standards with flexibility
Global organizations need structure. Local businesses need to focus their sales team on local priorities. How can these apparently conflicting needs be balanced?
Looking Ahead: Should We Make a Change?
Sales Compensation Focus, July 2010 – The economy appears to have taken a positive turn and many companies are starting to think about growth: hiring more sales reps, launching a new product, or breaking into a new market segment. One of the first questions that is raised when a company returns to growth mode, especially if there has been significant retrenching, is, “What should we do with our sales compensation plans?”
How should sales people be rewarded for sales quality?
As businesses grow, mature, and become more complex, the quality of the revenue increases in importance. This often comes up when the sales team has hit their assigned sales numbers, but the company is disappointed with the nature of those sales.