I'm a big believer in uncapped commissions. Why should the sales person not earn more if the company is earning more? Every company knows how much each incoming pound is worth to them why should the sales people be any different? I am an advocate of flat percentage commission schemes. If you sell £100 of product the sales person gets £10 if he sells £1 million he gets £100,000.
However often this doesn't fit into the business model the company has created. Sales people are paid on hitting target. They are paid for reaching KPI's. In the eyes of the sales people (and often they are right) these schemes are used as a way of paying them less. Once they reach the target it shifts. If they are making 100 calls a day to make their KPIs they suddenly find they need to make 120 before they can earn.
Not reaching KPIs or revenue targets should be a discplinary/training issue. Docking wages is lazy management often brought in by those that don't understand how to maximise the motivation of their staff through a sense of ownership and personal achievement.
However often this doesn't fit into the business model the company has created. Sales people are paid on hitting target. They are paid for reaching KPI's. In the eyes of the sales people (and often they are right) these schemes are used as a way of paying them less. Once they reach the target it shifts. If they are making 100 calls a day to make their KPIs they suddenly find they need to make 120 before they can earn.
Not reaching KPIs or revenue targets should be a discplinary/training issue. Docking wages is lazy management often brought in by those that don't understand how to maximise the motivation of their staff through a sense of ownership and personal achievement.
Completely agree with this. Flat rates are always best from the sales persons perspective. But as a senior manager running a business, the initial high percentages offered in the early days of a start up, quickly become unaffordable as the company goes through painful step-changes.
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