structures for paying outsides sales people

setting up commission structures

[Amadauss]

Hi,

I manage a sales force selling construction and remodeling products to supply companies and window dealers. I wanted to start paying my salespeople differently and was looking for some advice. We are a manufacturer of these products. Some type of salary and commission structure, maybe without bonus, but not sure. Would appreciate any help.

Thanks,

Mike

[eljefe3]

Hi Mike,

Welcome to WebmasterWorld. Can you please clarify if your outside sales force is selling via the internet, or another medium. If you are paying a salary and commission via the internet, I'm sure there would be a lot of potential website owners who would love to draw a salary.

How much you pay would depend on your margins, costs etc.

[mansterfred]

I am also a manufacturer. We use a 100% commission with a draw base. I have had variations with more salary and less commission. Bottom line in my business I have found:

1)Higher base with commissions equals more stability but fewer sales.
2)100% commission without a base equals the highest return but the most turnover.
3)100% Commissions with a draw* equals high sales with manageable turnover.

*Draw-Our draw is set at up to 80% of the previous years sales divided by 12 months. Any bank the rep owes on must be paid back out of excess commission (amount exceeding draw base) each month.

Note: We also pay all Expenses on our outside reps.

[Amadauss]

All sales done to outside customers calling on them with our vehicles. Sales guys build relationships with customers and then sell products they need, mostly windows, siding and roofing materials.

[Amadauss]

Thanks, Mansterfred. What is your draw amount and how far do you let it go with out sales. What is the most your sales people can make in a year, is their a cap or adjustment you make to limit them or do you let them make as much as possible. Do you require a daily log of activities? What kind of cell phone allowance if any. Thanks for your help.
Mike