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I recently started work as a salesperson at a large sailing center. The original idea was base salary + commission, but they've never done commission before and the director wasn't sure how to approach it at the time.

So I accepted just a base salary for 1-2 months (I also do other work there) and we agreed that we'd revisit the subject after that time period.

Well, it's that time now but we still have conflicting views regarding commission. Everything is very amicable and open. We talk it through rationally from both points of view and the director is up for doing it, but he doesn't see how it could be successfully implemented at the center due to their business model.

I'll explain ... we have a mixture of fixed staff and temporary staff (the sailing instructors). Everyone, in reality, does sales and a bit of everything. On the fixed staff we have someone who has designed products from scratch, marketed them and sells them constantly (either through platforms, inbound calls, talking to people in person who come into the center, reaching out to organisations, etc...) and who gets paid a fixed salary. Other people do similar things to a lesser extent.

The director wants to get 5-6 of the people who are on the fixed staff, including him and myself, doing sales as much as possible as the center needs it.

When I bring up commissions, he sees the following:

  • People should do their best with their base salary, i.e. if they're assigned to sales then there's no reason they shouldn't bring as many sales in as possible. Why pay them extra to do their job?
  • If salespeople get commission, what about the rest of staff who also do a lot of things that can be considered sales? For example the case I mentioned before. Shouldn't they also get commission?
  • It's complicated to implement and he thinks it's more straightforward to stick with salary.

I see it this way:

  • Commission will motivate people to do even better. You might reach a "peak performance" level on salary but the commission can take you further. Of course, I realise that this doesn't apply to everyone and I look at it a lot through my own personal point-of-view.
  • There should be clearly delineated responsibilities and a dedicated sales team. There shouldn't be friction if salespeople earn more than salaried staff as that's normal. This one is impossible though because the responsibilities everyone have are pretty fluid, excluding administration and finance.
  • We pay travel agents a commission similar to the one we're considering. If we already do that, it means we can do it internally with the advantage that our team is focused exclusively on selling the center's products as opposed to a TA who has lots of activity providers they earn commission from.

As you can see I understand his point of view and can actually agree with it too. But I, personally, can't do sales without a performance-based component. It's contrary to my nature.

One way out of this impasse would be to give everyone who does sales two "extreme" choices: either salary or only commission. I'd probably opt for the latter.

It's all very complicated though and that doesn't help.

How can I convince management to implement a commission system for sales?

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    Hey Workaholic, and welcome to The Workplace! I made a brief edit to your question to bring it in line with the guidelines in our help center. Hopefully it still matches what you want to know, but also makes it easier for people to provide answers. If you think I mucked it up, feel free to edit yourself. Thanks in advance! – jmac Sep 18 '14 at 0:02
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If I were management, I would be reluctant to offer commission in the situation you described. With duties being pretty fluid except administration, rewarding one duty (sales) means that it is to the employees benefit to focus solely on that and not other duties. Commissions are ideal for people whose sole duty is sales and a bit of a gamble otherwise. A annual/quarterly bonus for permanent staff based on revenue or profit might make sense (as almost all job duties should lead to the bottom line) but a direct commission doesn't.

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Typically, there's a trade-off for getting commissions versus a salary, particularly when the work-force is fairly homogeneous (that is, management believes one can easily substitute for another).

Other things being equal, the only way a salesperson gets commission with a salary at the same rate as other salaried employees is because the salesperson has a good track record but wants to reduce the variability of their commission income by accepting a lower commission rate as a trade-off for a higher salary.

You have some other things working against you:

  • Other employees are currently partly responsible for sales.
  • The culture of the firm is currently one of straight salary compensation.

The most likely way I see you getting onto commissions is to do the following:

  1. Be willing to accept a lower salary.
  2. Have sales as your sole responsibility.
  3. Bring in a lot more business and then threaten to leave for a firm that pays commissions to entrepreneurial employees.
  4. Leave for a firm that pays commissions to entrepreneurial employees.

I sincerely doubt you'll convince your boss to pay you more unless you demonstrate your value to the business by bringing in customers they would not otherwise have. Even if you do, your boss is used to doing things his way and probably won't want to change even if you demonstrate huge value and threaten to leave. I think you're going to have to find new management in order to convince them to pay you commissions.

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