I’ve worked both commission only as well as salary plus commission sales jobs and I can say without a shadow of a doubt that salary plus commission is a much better situation all around. I’d say a majority of sales professionals prefer getting paid regardless of whether a sale is closed or not. Plus when I was on salary I am a much more committed to doing all of the ancillary tasks and trainings involved in the job, other than strictly closing a deal. You hit the nail on the head with this video, Solomon.
Thanks, James! :) There are numerous advantages to having a salary plus commission job over a purely commission-based one. By the way, What stood out to you the most?
As a Chiropractic office wanting to grow, we are hoping to make the front office salary and the back office to be commission 15-20% of collections after overhead. do you have any suggestions.
What would be the on target earning for your back office team? Is that 20-30% more than the industry average if you were to do this on a commission only base salary?
We building the team with sales people and their HOD to manage the team and report the the manager/ ceo of dep’t. We work finnace industry fundraising for the business of construction constractor. We discussing about the team commission of HOD ( not his/her perosnal commission) / monthly should be lower or higher/ rising when they have higher role. Because their personal commission we making higher the more they have higher role in the company. But still confuse abt the team commission that they manage. Could u have any suggestion? Thx u so much
Rule of thumb: take care of your sales person. Sales people = rain 🌧️ makers. No sales people, no sales. I recommend going higher commission than industry standard to retain your reps.
The business I work with has residual income and is SAAS, so it has a great benefit to work with each business because it can lead to long term residual commissons.
The challenge is retention of commission only sales. It’s fundamentally challenging. If you’re dealing with 1099 contractors, and haven’t succeeded it’s because you get them and lose them because they’re either bad at the offer, has no prior experience in your industry, or starts a new offer that may seems easier to sell on the outset. There can also be just plain life changes. We work with quite a lot of sales people for our agencies, the 🎯 is having dedicated people committed to your business only. Just because you took Dan Lok HTC doesn’t make you a closer either 🙏🏽 it’s perfect for a coach or consultant who has a fixed price product, fixed deliverable and a high enough demand (burn $$ ad dollars) you can afford to lose deals as you switch closers, onboard new ones, but will do just fine with the model. This is not the case in most small sales organization, demand is the biggest challenge so you need good people who will stick with you long term. Let me know your thoughts 💭
I have had 12 commission only sales reps for about 8 years at this point. We are brokers for physical commodities and real estate here in London and bridge buyers and sellers across the globe. Here's something to understand- There are many salespeople with 15+ years of glorious experience who are more than willing to work on commission basis, provided you can explain to them a) Your products/services and why people/businesses would buy from you, rather than from someone else. Do you extend credit to your buyers? This is very important, for many salespeople get turned down the moment the lead gets to know that there's no trade credit available. The alternate would be to price your offerings so low that it beats third world pricing. If you as a business owner are depending on the later, kiss goodbye to your business. Yeah, you can fool yourself with how great your 'quality' is, but lets be honest, it doesn't matter. b) What is the guarantee of you as a company getting paid, incase you happen to sell on credit? Trade credit insurance comes in handy over here, whether you're selling a product or a service. c) Why they should believe that you'll pay them. Contracts and agreements are good on paper, but everybody knows how many companies hiring commission-only agents behave- they purposedly delay the deal (below the surface, the business relationship is already brewing) so that the agents give up. What I did here was that I gave them representation rights (i.e, they can sign on deals on behalf of my company provided they stick to a set guideline). Additionally, I gave them 4% equity holdings in my company- each of them gets 4% of the yearly dividends. I reserve the right to dilute the stake of any who don't perform well. Our opex is low (none of them, including me as the director takes any salary). d) What mechanism have you set up to ensure that buyers do repeat business with you? Do you have long term contracts? If agents get paid only when they convert a unique lead, it won't take long before they run out of earning sources. e) What infrastructure you have to provide them with continuous training. Training is important, even for seasoned sales professionals. You should also provide them a market analysis pertaining to your products/services/industry atleast once every quarter. f) If you can provide them with qualified leads. This lead generation, it's better to outsource it. We get 5k qualified leads for 2.5k. Each of our agents brings in on an average £20 million a year in sales for us, 70% of it being repeat sales. Our opex for having those 12 is still less than 300k a year. If we hired them on a salary basis, that's what each of them would cost us. We are looking to ramp up our revenue by 5x in the next 8 years, post which we'll exit at a p/e of 20 through the LSE (keeping fingers crossed).
Commission only makes a lot of sense as it’s in real estate. Smaller service companies can only give about a $1000-2000 on average for commission. Thus it creates a lot of churn. Thank you for sharing your story, and best of luck with your plans for future growth and potential exit strategy. 🙏🙏🙏
Great content. My friend sent this to me and I have to say - you are doing a great work. High quality content and a compelling presentation. Cheers!
Thanks Jimmy! it really motivates me to continue doing what I do!
What did you think was the most interesting aspect of the video?
I’ve worked both commission only as well as salary plus commission sales jobs and I can say without a shadow of a doubt that salary plus commission is a much better situation all around. I’d say a majority of sales professionals prefer getting paid regardless of whether a sale is closed or not.
Plus when I was on salary I am a much more committed to doing all of the ancillary tasks and trainings involved in the job, other than strictly closing a deal.
You hit the nail on the head with this video, Solomon.
Thanks, James! :) There are numerous advantages to having a salary plus commission job over a purely commission-based one. By the way, What stood out to you the most?
As a Chiropractic office wanting to grow, we are hoping to make the front office salary and the back office to be commission 15-20% of collections after overhead. do you have any suggestions.
What would be the on target earning for your back office team? Is that 20-30% more than the industry average if you were to do this on a commission only base salary?
We building the team with sales people and their HOD to manage the team and report the the manager/ ceo of dep’t. We work finnace industry fundraising for the business of construction constractor. We discussing about the team commission of HOD ( not his/her perosnal commission) / monthly should be lower or higher/ rising when they have higher role. Because their personal commission we making higher the more they have higher role in the company. But still confuse abt the team commission that they manage. Could u have any suggestion? Thx u so much
Rule of thumb: take care of your sales person. Sales people = rain 🌧️ makers. No sales people, no sales. I recommend going higher commission than industry standard to retain your reps.
i agree so too, thx u so much
The business I work with has residual income and is SAAS, so it has a great benefit to work with each business because it can lead to long term residual commissons.
Do you get commission every month?
@Clickxio Yes, "residual" was the key word there. They also pay weekly.
@@Clickxio It’s also 40% commission.
Yes, but what happens when the sales person is able to maximize opportunity?
Tell me more 🙏🏽
You obviously havent found the right commission only structure then.
The challenge is retention of commission only sales. It’s fundamentally challenging. If you’re dealing with 1099 contractors, and haven’t succeeded it’s because you get them and lose them because they’re either bad at the offer, has no prior experience in your industry, or starts a new offer that may seems easier to sell on the outset. There can also be just plain life changes. We work with quite a lot of sales people for our agencies, the 🎯 is having dedicated people committed to your business only. Just because you took Dan Lok HTC doesn’t make you a closer either 🙏🏽 it’s perfect for a coach or consultant who has a fixed price product, fixed deliverable and a high enough demand (burn $$ ad dollars) you can afford to lose deals as you switch closers, onboard new ones, but will do just fine with the model. This is not the case in most small sales organization, demand is the biggest challenge so you need good people who will stick with you long term. Let me know your thoughts 💭
I have had 12 commission only sales reps for about 8 years at this point. We are brokers for physical commodities and real estate here in London and bridge buyers and sellers across the globe.
Here's something to understand-
There are many salespeople with 15+ years of glorious experience who are more than willing to work on commission basis, provided you can explain to them
a) Your products/services and why people/businesses would buy from you, rather than from someone else. Do you extend credit to your buyers? This is very important, for many salespeople get turned down the moment the lead gets to know that there's no trade credit available. The alternate would be to price your offerings so low that it beats third world pricing. If you as a business owner are depending on the later, kiss goodbye to your business. Yeah, you can fool yourself with how great your 'quality' is, but lets be honest, it doesn't matter.
b) What is the guarantee of you as a company getting paid, incase you happen to sell on credit? Trade credit insurance comes in handy over here, whether you're selling a product or a service.
c) Why they should believe that you'll pay them. Contracts and agreements are good on paper, but everybody knows how many companies hiring commission-only agents behave- they purposedly delay the deal (below the surface, the business relationship is already brewing) so that the agents give up. What I did here was that I gave them representation rights (i.e, they can sign on deals on behalf of my company provided they stick to a set guideline). Additionally, I gave them 4% equity holdings in my company- each of them gets 4% of the yearly dividends. I reserve the right to dilute the stake of any who don't perform well. Our opex is low (none of them, including me as the director takes any salary).
d) What mechanism have you set up to ensure that buyers do repeat business with you? Do you have long term contracts? If agents get paid only when they convert a unique lead, it won't take long before they run out of earning sources.
e) What infrastructure you have to provide them with continuous training. Training is important, even for seasoned sales professionals. You should also provide them a market analysis pertaining to your products/services/industry atleast once every quarter.
f) If you can provide them with qualified leads. This lead generation, it's better to outsource it. We get 5k qualified leads for 2.5k.
Each of our agents brings in on an average £20 million a year in sales for us, 70% of it being repeat sales. Our opex for having those 12 is still less than 300k a year. If we hired them on a salary basis, that's what each of them would cost us. We are looking to ramp up our revenue by 5x in the next 8 years, post which we'll exit at a p/e of 20 through the LSE (keeping fingers crossed).
Commission only makes a lot of sense as it’s in real estate. Smaller service companies can only give about a $1000-2000 on average for commission. Thus it creates a lot of churn. Thank you for sharing your story, and best of luck with your plans for future growth and potential exit strategy. 🙏🙏🙏