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New commission plan...Deal or no deal?

My boss just instituted a new commission plan (print industry) for the sales team to "try out and see if it works". We went from salaried positions to base salary with commission.

My particular situation looks like this:
  • Salary cut to less than 75%: base now $18,200 with 4.5% commission rate (average in my area is 41k)
  • Increased duties with making deliveries/pickups
  • Been using my personal phone as problematic company phone was never replaced
  • Loosing monthly gas allowance
  • No access (though promised after a year) to sales credit card for treating clients to lunch/work events, etc.
  • Increase in clients going online due to budget cuts/management decree
Is this a reasonable/good deal? Or should I be thankful to have a job?

Thanks for any advice. - by NewToSales
I think first of all, you need to take your original income and "perks" and divide by what you're doing to see if it's a good deal or not. If you used to have a card for lunch, then you should have a reimbursement plan before I accept a change. "Company" expenses should remain company expenses, your "remuneration" should remain yours. If you're picking up "company" expenses as you're own, then you need to have opportunity to make more money.

On the other side of the issue, is just that. What are the upside potentials for you. I did this myself with an insurance company I managed, went on commission. If I was smart, I'd have done it a little differently, but I had all my accounts transferred to me that I "wrote" up for the house. We make about what you do, 5% commissions on the upside, 3.5% on the lowside for some and if you have the potential to expand, it can be much more lucrative.

Aloha... :cool: shds; - by rattus58
I don't mean any disrespect in this, NewToSales, but do you have a choice?

Nobody likes their compensation plan messed with (unless it's a huge raise). But changes happen, and the ultimate decision for most salespeople is eiither stay and make the best of it, or leave and find greener pastures (if, indeed, they exist).

Some of your post sounds like complaining (perhaps justified) about things that are not related to the compensation plan (no access to company credit card, etc.).

My advice: Give it your absolute best for 3 months (maybe 6); don't look back, and don't compare to how it "used to be" because how it used to be isn't applicable any more. If you can't make it work after 3 months, find a position that better suits you. - by Skip Anderson
Sales pay-plans always change. As a sales person, this is something you need to expect.

The managers try to set up a pay structure to be motivating and in line with their vision. They push it as far as possible without trying to demotivate the team.

Inevitably any good team will outlast the payplan by reaching the goals or vision of the management's plan and they will start to make too much money. This is when the management 're-aligns' the plan to reach a new set of goals.

When looking at a sales compensation plans I try to find out what the top 10% of the sales people are earning. This tells me where the ceiling is for this company at this time. (since management ideology can change too) It also gives me an idea of what I expect to earn as a top salesman with the organization.

YRMV :) - by Tony_B
In my limited experience with this... choosing myself to go from Salary to commission, I've little knowledge of how it generally is being done today.

My personal experience, my personal bias, and my personal motivations are that when times are tough, you work more hours, not cut expenses... although that can and should be on everyones budget platter monthly anyway... at least so you know what each sale is worth... each call is worth etc.

Personally I'm not hanging around unless it makes sense. I'm not giving anyone the benefit of my service unless I BENEFIT by my service. Salary plus commissions are a much better way to transition than going to straight commission like I did. However... like has been said.. you have to evaluate your own positions.

I'd like to know what I brought to the table before I'd accept anything however, but that is just me. I know how hard I will work. Most of us do not work to capacity in sales, so adding an extra one or two hours a day is easy for us to do and double your income. I can prove this to be so. No net loss. That is the key for me.

Much Aloha, ;bg shds; - by rattus58
I think there was a misunderstanding on some level. I am not complaining (though I am not pleased), but I listed the gist of the new plan to get feedback. I have weighed the "benefits" and they do not pan out, but my ID is NewToSales as I am just that--New to sales. This is my FIRST sales job ever. I have no real guideline for knowing (outside of online research) what is a typical commission plan. Communication from management is poor.

Thank you for all of your advice, but I am looking to get your opinion on whether this was typical or should I take heed and prepare for negotiation--if it's even viable.

Skip and Tony B.: Thank you. I think you understand where I am coming from. We were just told it was happening and even then it was open-ended. Management has been very fuzzy on the details and continue to remain so. That is why I am asking advice as I am new to this industry and I need to know if this is typical or whether I should be wary.

I'll have to dig a little deeper, but I don't feel positive about the change. Internal management/staff problems that lead to external customer problems, which lead to customer dissatisfaction. Print to online transitions. The majority of the profitable accounts either taken by Sales Director or converted to House...I think, perhaps, I was brought in at a bad time and that management has no clear vision of their own goals.

So for now, all of the balls are suspended mid-air and it's too foggy for me to see what is up for grabs.

Again, thanks for the advice you've given so far :) - by NewToSales
Hi New

I am in media sales and I am paid strictly commission. No salary, no phone allowance, and very little for client meals, etc. I have almost always worked that way. I also do tape delivery and pickup go on commercial shoots, write copy, write proposals and lots of other things I don't get paid for, it is just part of the job. But I love it! I write my own paycheck. I am in charge of my payroll. It gives me incentive to do more. My advice is give it a little time before you make a decision. I don't know how long you have been there but I'm sure you have invested some time so why wate it before you give it a chance to work. - by MPrince
... average in my area is 41k...
Average volume? If so - average per month/per year?

Average commissions? If so - average per month/per year?

What I am getting at is, can you make real money? The best are making over a million a year in sales. If you can't comfortably make $100,000 you ought to look for a better sales job and it seems as if you can't nor could you before you had the deal changed.

If I am incorrect I apologize but if I am reading this right you are woefully under paid in either system of compesation. - by Gold Calling
I would figure out what it would take to make the money I am used to under the new plan. That is, do I have to work harder, work less, or the same to earn the same paycheck. If the answer is harder, the next thing I want to know is if it is impossible or even worth the extra effort. If not, remember, you were looking for a job when you found this one. After all, you are the valuable resource not your boss. - by jdedwa11
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