If you are paid 100% commissions, I have questions

[madringal]

I am leaving my management position and taking a sales role that will be 100% commission based.  I have been in sales in the industry for 20+ years, but all of my sales roles have been base+bonus.  I am expecting my offer letter any day, so tell me what kinds of things do I need to look for? Is there anything to even negotiate? I will have a very small salary that I am paid the first three months while I am in training, and then amount moves to a draw.

[Covergirl82]

Will your commissions be monthly or quarterly? Or both? Maybe something to consider negotiating is a guarantee for the first 3 months of your commission-based pay (e.g., minimum payout is at target, but if the actual payout is higher, you get the higher amount). When I did sales compensation, that was not unusual for a new employee to receive. (Where I worked, all sales employees were base + commission.)

[madringal]

Mar 30, 2021 14:26:42 GMT -5 Covergirl82 said:

Will your commissions be monthly or quarterly? Or both? Maybe something to consider negotiating is a guarantee for the first 3 months of your commission-based pay (e.g., minimum payout is at target, but if the actual payout is higher, you get the higher amount). When I did sales compensation, that was not unusual for a new employee to receive. (Where I worked, all sales employees were base + commission.)

They will be monthly.  It sounds like I will get a guarantee for the first three months, but is that amount typically negotiable?

[marie]

I am not paid commissions, but my job is to manage a compensation plan for associates that are. I am not sure what type of sales job this is, but we do much longer than 3 months. We generally 12-16 months, but that is how long it takes to establish a book of business in this area (financial services). Also, when they move to a draw, we drop the salary/draw to the state minimum so that they do not start accruing excess. Just something to think about, not sure if your salary will change.

[Covergirl82]

madringal, I would ask for 6 months minimum. I don't doubt your skills given your experience, but with the economy being so volatile right now, better to have longer to build your prospects. (And I recall that when I was calculating sales commissions, one of the Sales VPs said that often it takes at least a few months from initial contact to closing the sale...at least that's what it was for that industry (health insurance).)

[madringal]

marie, great info, thanks!

[madringal]

Covergirl82, Hmm...I never even thought about making it longer, I was really just thinking about making it more. Good idea! Thanks!

[marie]

Also, there are deals we have where you will not go into excess if you do not earn through your draw. That may be an easier ask if they reject your request to increase your salary plus incentive 3 month period. At times people dig them self into a hole that it is hard to earn their way out of, but if you can not carry forward excess that is helpful while starting up

[madringal]

Mar 31, 2021 16:51:46 GMT -5 marie said:

Also, there are deals we have where you will not go into excess if you do not earn through your draw. That may be an easier ask if they reject your request to increase your salary plus incentive 3 month period. At times people dig them self into a hole that it is hard to earn their way out of, but if you can not carry forward excess that is helpful while starting up

Also good to know! Thanks!