There are many sales management variables to consider and the best mix will differ from business to business, and industry to industry. Typically, a well-structured sales compensation package includes:
- A base salary
- Commission – either a percentage of the gross sale or based on profit margin
- Sales bonuses for reaching established goals or milestones.
Business.com's "What Works for Business" blog is a great way to keep up with the latest solutions, trends and strategies for small and medium business — including How to Fix a Sales Compensation Plan.
Action Steps
The best contacts and resources to help you get it done
Go with experience in on-demand sales management
Centive, founded in 1997, has received numerous industry awards for its sales management prowess and tech innovation.I recommend: Compel is an online sales compensation management system developed by Centive. It's become a top web-based choice among small and mid-sized businesses and features a Compensation Plan Builder that lets you build, test model and release a compensation plan via a structured process that requires no internal IT resources. Special dashboards display real time data, and it can be fully integrated with Salesforce.com and other customer relationship management solutions. Check out one of the Compel webinars to see how it works or take an online product tour. Check out the case studies before you sign on.
An affordable web-based solution for small business
Dump that spreadsheet and go high-tech. Tap a total internet solution that can help you design and implement a new plan, change or update a plan, manage a plan - in short, do what's necessary to assure your approach is the best it can be.I recommend: Xactly Corporation offers affordable, state-of-the-art, on-demand sales compensation solutions.
Get software to do it for you
Software designed specifically to help you calculate and track commissions and bonuses can be a big time saver for a small business.I recommend: QCommission is sales compensation software that integrates easily with QuickBooks or can be used independently.
Call in the consulting cavalry
Fast growing companies may need specialized consulting help to create a successful sales compensation plan.I recommend: Compensation Resources, Inc. creates programs to attract, retain and reward outstanding sales talent.
Check out what other small businesses are doing
eVenturing.org has compiled a bundle of tools on creating effective sales compensation plans, including examples of actual sales compensation plans that illustrate key elements such as plan objectives, sales quotas and compensation formulas.I recommend: You find it at eVenturing.org.
Tips & Tactics
Helpful advice for making the most of this Guide
- If you have different types of sales jobs, create a unique compensation plan for each.
- Avoid annuity type compensation that continues to pay commissions for no additional work on the sales person's part.
- Reward sales results, not just effort.
- Establish quotas that you think 70 percent of sales people can make.
- Monitor your program continuously to make sure it's working and there are no abuses.
BGI Defined Contribution
Simple yet Sophisticated Investing. Professionally Managed. Learn More.
SponsorMatch | LifePath
www.bgiDCsolutions.com
Simple yet Sophisticated Investing. Professionally Managed. Learn More.
SponsorMatch | LifePath
www.bgiDCsolutions.com
Williams-Sonoma Gifts
Choose from distinctive corporate gifts. Save 10% on volume orders.
Williams-Sonoma.com
Choose from distinctive corporate gifts. Save 10% on volume orders.
Williams-Sonoma.com
401ks Designed for Small Businesses and Individuals
Low-cost, on-demand and easy-setup plans from ShareBuilder 401(k). Plans for 1 or more priced from $15 month. Learn more.
www.ShareBuilder401k.com
Low-cost, on-demand and easy-setup plans from ShareBuilder 401(k). Plans for 1 or more priced from $15 month. Learn more.
www.ShareBuilder401k.com
Compensation Management During the Economic Crunch
Retain employees, keep morale high, and enforce a performance-based, goal-oriented company culture - Learn How.
Free Whitepaper
www.SumTotalSystems.com
Retain employees, keep morale high, and enforce a performance-based, goal-oriented company culture - Learn How.
Free Whitepaper
www.SumTotalSystems.com
Free B2B search marketing whitepaper, B2B Search Marketing Strategy Guide: Advice From the Pros.
