Fair Comission Plans

Maybe there's no one pulling 300K in GP per year? I would tend to think that 50% commissions for this type of top level performance should be acceptable. However, maybe you need to add a clause for a "click commission"

Art

Ok lets change it to 200K per year...any info would greatly be appreciated

at a 25% gp to revenue percentage this rep wouldbe doing $800K for the year. what would his revenue quota be? 40K? 50K? per month? someone of this caliber would need to be in the six figures, i would think. if you set up a gp quota of $6K per month and pay 50% for everything over that it would give them about $7K in gp commission. per month. A base of $30K along with other spiffs would do that. just a thought.

A rep for us making $300000 GP per year would be in the neighborhood of $130,000 to $145,000 per year depending on bonus goals. It’s straight draw. No salary.

$300,000 GP rep would be making $130-160k for us.

The range is there since we pay bonuses on Leases and SMP.

SMP=Single Machine Placements?

How do you pay bonuses on leases

You speak of $300,000 G.P. above sales cost. Anytime you try to compare commission plans, you need to keep in mind that that the amount of "pad" added to Dealer's Cost can have a significant impact on commissions even though it may not effect total income.
This is what I mean. One company may pay $3,000/mo. salary and 40% commissions but have a sales cost that is 20% above Dealer Cost. Another company may only pay $3,000 salary and 30% commissions but be a better plan because they pay based on a sales cost of 5% over dealer cost.
The main point is, $300,000 G.P. may be a more significant number with one company vs. another.

I would like to know how (and why) bonuses are paid for single unit placements?

ANYBODY BRINGING IN $ 200-300,000 GP SHOULD MAKE IN THE SIX FIGURES. THE BIGGEST PROBLEM WITH THE COMMENTS ABOVE IS DEALER COST. MOST SALES AND MANAGERS DON'T REALLY KNOW WHAT THE TRUE DEALER COST IS. ALL MANUFACTURES OFFERS PROMO'S IF THE DEALER BUYS ALOT, PLUS THEY OTHER OTHER INCENTIVES WE NEVER HEARD ABOUT.
IF A SALESMAN IS TRUELY GROSSING OVER TRUE DEALER COST $200-300,000 G.P., I WOULD THINK THE DEALER BETTER BE KISSING HIS OR HER ASS.

AMEN!!!!!!!!!!!!!!

No question that is alot of G.P. in anybody's book. I personally am not one who believes that a sales rep has right to share in the savings when a dealer takes advantage of "cash with order" discounts or quantity discounts. Sales reps aren't the ones who get "stuck" with discountinued inventory ,etc. so I'm willing to accept that deal. Therefore, I'm OK with Dealer Cost being based on regular "Single Unit Price" regardless of occassional discounts. The way I see it, for me to lay claim to that is just as wrong as them trying to take my Aficio League Points.

Jim:

My company uses a 20% pack. No discounts are passed and on along with CWO's. They are entitled to this, it is their company. In reference to the 200K -300K, yes I agree the rep should be getting anything in reason for that type of GP volume, and thats what I stated for the AMEN!

I am not the smartest or most gifted sales person on the block however longevity and the desire to work hard, compete and win makes me above average when it comes to the numbers.

What ticks me off most is the day to day BS, inventory levels, cash flow, and managing the business. When I started 9 years ago we had inventory, demo units, delivered our own systems, bonuses for demos, Trip. Now nine years later we are "just in time inventory", no demo units, delivery is now farmed out, you can not even do a demo without asked first and then IF it is approved waiting two weeks for the demo to arrive, so in essense demos are now gone along with bonus ( I came from the old school, out one in on trial and it will sell, this is still true today ).

We all know it everyone does it when it comes to pricing from manufacturers, we have all found ways to get a better price from a manufacturer if we need it, I once and asked and received a better price on a unit in a competetive deal, however the trade off was to accept 10% less in commissions. HUH????

Most times I shake my head and move on............

I don't mind a dealer packing the unit. So don't get me wrong. I understand he has overhead and the cost of doing business. My feelings is, I don't care if the owner has his boats, cars ,houses,and vacations as long as I don't feel I am paying for it. If I am a top producer in your company take care of me.
If I am one of you top producer, grossing a lot of GP, don't forget how much service and supplies business I am also getting for the company.

TAKE CARE OF ME.

20% "pack"...WOW...I hope you get a high salary and commission % in return. We recently went from 12% to 13% when we started adding surge protectors with all installs. We also have the latitude to go almost to cost for half commission without prior approval.

Great Topic!!!!!

I too get nothing for service and supplies except when I sell suppies at the time of the sale. Also with the industry moving more to monthly cpc charges and less yearly maintenance agreements I also receive nothing for this.

I have just started tracking the pages that I am capturing with new installs, where I knock out a MFP's faxes and printers. I can now tract how many new clicks I am pulling in for the company and the charges associated with these. I feel as this can be a leveraging point when I need to re-negoiate my sales contract or when I wish to leave and pursue another company.

I'm with Merlin, TAKE CARE OF ME! Recently we had a new rep (in the biz for a long time) hired by our company. He was given carte blanch to sell in all territories even mine. Is this TAKING CARE OF ME! I think not, end result is this guy quit again after eight months and left his usual baggage of sour deals in his wake.

A few questions for you all what is above average GP for a year? Is 300K on the top end of the scale? If so how many reps are doing that type og GP, 1%??

I average somewhere about $200K per year for down the street sales. Would like to hear fromm others

Inventory has become an almost impossible issue. When I started, the only accessories for the most part were a finisher or LCT and we had a 13, 20, 28, 35, 45, and 60 cpm unit...6-7 mainframes and a few fax machines. Look at it now...we literally have more fax models now than we used to have copier models and more possible accessories per model than we used to have in the whole product line. Add a full line of printers and a parallel copier line that is color. We now have 57 separate and distinct mainframe model numbers JUST COUNTING THE B&W MAINFRAMES. Each model has 35-50 possible accessories. None of us would suggest that all of those need to be in inventory but we do need to realize that "we aren't in Kansas anymore."

quote:

Originally posted by Jim Parker:
Inventory has become an almost impossible issue. When I started, the only accessories for the most part were a finisher or LCT and we had a 13, 20, 28, 35, 45, and 60 cpm unit...6-7 mainframes and a few fax machines. Look at it now...we literally have more fax models now than we used to have copier models and more possible accessories per model than we used to have in the whole product line. Add a full line of printers and a parallel copier line that is color. We now have 57 separate and distinct mainframe model numbers JUST COUNTING THE B&W MAINFRAMES. Each model has 35-50 possible accessories. None of us would suggest that all of those need to be in inventory but we do need to realize that "we aren't in Kansas anymore."

You are right Jim, however it would be nice to have at least one model for each segement, we have one system for demo that I can think of right now and over the past year we have had no more than three, and one of them was a 240W that was deemed DOA and we had too rebuilt it.

That's crazy. We have 6 reps and try to keep the following in stock:
(2) MP161 SP's
(2) 2020D's
(3) 2510's
(1) MP3500
(1) MP4500
(1) MP C2500
(1) MP C4500
And enough of the common accessories to configure each of these.

Our demo inventory:

(1) MP5500
(1) 240W

That's it for 5 reps, wish my wife would move to East Texas! I'd be outta here in a heartbeat!

And we'd have a place for you. It's closer to your son's baseball games!!!

Art, there are many beautiful places to live that happen to be in my dealer's territories. When you want to move, give me a call .

Jim's inventory is impressive per capita, I can't beat it. On the flip side, my demo floor in my location has 16 machines on it with 2 wide formats and 2 scanners.

Did I mention we're hiring?

quote:

A few questions for you all what is above average GP for a year? Is 300K on the top end of the scale? If so how many reps are doing that type og GP, 1%??

Yeah, 300k is an impressive number I'm sure that is top 1% for reps Nationwide.

I don't have the numbers in front of me, but I'd guess we had 5 or 6 reps hit that number last year.

Just to give you an idea of the kind of variation there is, I went to the BTA compensation Survey of 2007. According to their survey, the median compaensation for a salesrep with 6+ years experience was $127,500/yr with a maximum of $422,377 for a rep in the West vs. $54,000/yr. and $104,000 for a rep in the Southeast. There is a significant difference in the cost of living which effects both the employee and the employer and therefore also effects compensation.

Wow, hard to believe a rep making over 400K!