A few years ago a Sales Manager made this statement, "There is no perfect sales comp plan". Ok, I beg to differ. There is a perfect sales comp plan, that perfect plan is too give me 100% of the commissions! Especially since you're nickel and diming me to the poor house!
1) At $390 I can accept the cost to return a copy machine to the leasing company. I understand that there are costs involved. But, charging me $390 each when we have to return 6 copy machines to the same location is a sin! What really gets me is when four of those copy machines are Segment ones!
2) $350 to deliver and install one copy machine is more than acceptable, but what if I sell 10 to the same location? You're going to charge $3,500 for one truck and three people to deliver and install 10 copy machines! Wow, does that get me going.....
3) Service and Supply pricing, I get the point that you are in business to make a profit. But, why are my selling prices higher for maintenance and supplies? I've seen it. When at a customers office, went through maintenance and supply invoices and my company has sold them cheaper than I can. Wowie!
4) Leasing, ah this one really gets the goat. In most cases you'll make more on the lease rate factor increase than I will make in commissions for the deal!!
5) Do you really need to markup a production system that has a cost of $30,000 by 15% ($4,500), and then only pay me 27.5% of the gross profit? I sold the system for $40,000, you made $4,500 on the markup, $3,987 on the 72.5% of the gross profit that you keep, and $1,230 on the increase lease rate factor. Thus you got $9,717 and I got a stinking $1,512 before taxes!!!!
I like my job, but after 22 years in the business, a great customer base, I've got some soul searching to do.