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CLASSIC

Africa

Accounting, Apparel & fashion, Architecture and Planning, Arts and crafts, Branding and Design

Summary

What Does Commission Sales Mean?

When a company adopts the scheme of commission sales, it means that compensation to sellers is variable. In most cases, every transaction made by a particular vendor causes an additional payment to him. The vendor’s monthly income depends on his productivity as a salesperson. Commissions aim to encourage more sales because every individual deal means more money to the seller. This arrangement has also the purpose of giving fair reward to the most productive members of the sales team. Commissions are usually set as a percentage of the sales value which means that a vendor increases his income at the same rate of closed sales.

However, the percentage of commissions varies greatly across companies and economic sectors. For example, some firms have variable compensation based on team productivity instead of individual achievements. It might be based on number of units sold, sales value, new clients or a combination of several criteria. Sometimes salespeople earn a fixed monthly wage that does not depend on sales and also have a variable amount that do vary in line with the sales.

Agent best suited for this opportunity

What Does Commission Sales Mean? When a company adopts the scheme of commission sales, it means that compensation to sellers is variable. In most cases, every transaction made by a particular vendor causes an additional payment to him. The vendor’s monthly income depends on his productivity as a salesperson. Commissions aim to encourage more sales because every individual deal means more money to the seller. This arrangement has also the purpose of giving fair reward to the most productive members of the sales team. Commissions are usually set as a percentage of the sales value which means that a vendor increases his income at the same rate of closed sales. However, the percentage of commissions varies greatly across companies and economic sectors. For example, some firms have variable compensation based on team productivity instead of individual achievements. It might be based on number of units sold, sales value, new clients or a combination of several criteria. Sometimes salespeople earn a fixed monthly wage that does not depend on sales and also have a variable amount that do vary in line with the sales.