What is my commissionable value?
Posted: Mon Jan 27, 2025 5:28 am
When is a deal considered “Booked?”
You must have this defined. Is the deal booked when the customer signs the contract or when they make payment? If you do not know, ask.
When is a deal considered “Earned?”
Again, you must have this defined. Do you earn a deal once you receive full payment? Do you earn the deal once the job is completed? Some large complex deals are not complete for more than a year after booking. How does this affect the timing of your commission payment? If you do not know, ask.
When do you get paid?
How long after the deal has been booked and france telegram data earned do you get paid? If you do not know, ask.
Where can I view this in “real time?”
You should be able to look at a calendar and know for certain the date you can expect a commission payment. DO NOT allow for uncertainty. This is how you support yourself and your family. Uncertainty is unacceptable.
Do not leave this to fate. It may seem like you need to be an accountant to understand how to determine your commissionable value, but you do not. You simply need to understand the gross product, your commission rates on products and services (if separate), while deducting applicable sales tax rates.
Example: You sell $100,000 worth of products and $25,000 of services to your favorite new customer for a total of $125,000. With $10,000 of sales taxes the total charged to your customer is $135,000. If you receive 10% commission on products and 20% commission on services you would be due a $15,000 commission check. Of course, these numbers round up nicely, but with a calculator anybody can do this math. This is your livelihood, so get out that calculator on every deal.
Why to Ask About Your Commission Plan
Being a salesperson is a challenging profession, but it can be a very lucrative way to earn a living.
However, it is exceptionally important to have clarity on how you are rewarded financially. Admit it, you do not spend all day, everyday taking those “NO’s” for fun.
Anybody that is looking to join a new sales team must be crystal clear on how your efforts will be rewarded.
You must have this defined. Is the deal booked when the customer signs the contract or when they make payment? If you do not know, ask.
When is a deal considered “Earned?”
Again, you must have this defined. Do you earn a deal once you receive full payment? Do you earn the deal once the job is completed? Some large complex deals are not complete for more than a year after booking. How does this affect the timing of your commission payment? If you do not know, ask.
When do you get paid?
How long after the deal has been booked and france telegram data earned do you get paid? If you do not know, ask.
Where can I view this in “real time?”
You should be able to look at a calendar and know for certain the date you can expect a commission payment. DO NOT allow for uncertainty. This is how you support yourself and your family. Uncertainty is unacceptable.
Do not leave this to fate. It may seem like you need to be an accountant to understand how to determine your commissionable value, but you do not. You simply need to understand the gross product, your commission rates on products and services (if separate), while deducting applicable sales tax rates.
Example: You sell $100,000 worth of products and $25,000 of services to your favorite new customer for a total of $125,000. With $10,000 of sales taxes the total charged to your customer is $135,000. If you receive 10% commission on products and 20% commission on services you would be due a $15,000 commission check. Of course, these numbers round up nicely, but with a calculator anybody can do this math. This is your livelihood, so get out that calculator on every deal.
Why to Ask About Your Commission Plan
Being a salesperson is a challenging profession, but it can be a very lucrative way to earn a living.
However, it is exceptionally important to have clarity on how you are rewarded financially. Admit it, you do not spend all day, everyday taking those “NO’s” for fun.
Anybody that is looking to join a new sales team must be crystal clear on how your efforts will be rewarded.