- Original Poster
- #1
I have been doing freelance website development and design for the past 2 years, and currently get my work from several small companies that outsource to me.
I've decided that i need to get my own sales staff though.
Can you employ sales staff on commission only? My plan was to take someone on, and pay them at least 30% commission on every job they sell, and up to 40% if they reach a specified target in that month.
At the end of the month, i would work out their total commission, but because each job will consist of 2 main payments, the deposit and balance, i would only pay them half of the commission on each job, and pay them the other half when the final balance comes in to me.
This stops sales staff selling rubbish / bad jobs, Grabbing the commission, then leaving me with a bad job that I can't finish without taking a huge loss on the job or re-funding the customer (this is a real issue and i've seen sales staff destroy a company this way), that way if they don't sell to the rules, they wont get ALL their commission, minimizing my financial risk.
Providing the jobs are sold correctly, they will receive the rest of the commission on that job. In total, they will receive 100% of their commission, providing they do their job properly.
Each job, or sale will be worth between £750 to £1,500+ and if jobs are sold correctly, they can be put through in less then a month.
If the sales staff proved they could sell good jobs regularly, i would offer them a salary later on down the line, with a lower (but still reasonable) commission on each sale.
My questions are
1) Is 30%, with a roof of 40% acceptable? Will i have any trouble finding sales staff to work for this commission.
2) Are the rules I've imposed about the commission acceptable?
3) Is this legal? Can you employ people like this? Is minimum wage an issue, as they would be employed as freelancers, and they are responsible for making enough to pay their bills.
If they sell 5 jobs at the minimum price per month, their commission will give them more then minimum wage. But that's the incentive, if they sell more then X amount in a month, their commission (for all jobs) will go from 30% to 40%
Of course, any other relevant information you can provide, even if it's not asked for above would be much appreciated.
I've decided that i need to get my own sales staff though.
Can you employ sales staff on commission only? My plan was to take someone on, and pay them at least 30% commission on every job they sell, and up to 40% if they reach a specified target in that month.
At the end of the month, i would work out their total commission, but because each job will consist of 2 main payments, the deposit and balance, i would only pay them half of the commission on each job, and pay them the other half when the final balance comes in to me.
This stops sales staff selling rubbish / bad jobs, Grabbing the commission, then leaving me with a bad job that I can't finish without taking a huge loss on the job or re-funding the customer (this is a real issue and i've seen sales staff destroy a company this way), that way if they don't sell to the rules, they wont get ALL their commission, minimizing my financial risk.
Providing the jobs are sold correctly, they will receive the rest of the commission on that job. In total, they will receive 100% of their commission, providing they do their job properly.
Each job, or sale will be worth between £750 to £1,500+ and if jobs are sold correctly, they can be put through in less then a month.
If the sales staff proved they could sell good jobs regularly, i would offer them a salary later on down the line, with a lower (but still reasonable) commission on each sale.
My questions are
1) Is 30%, with a roof of 40% acceptable? Will i have any trouble finding sales staff to work for this commission.
2) Are the rules I've imposed about the commission acceptable?
3) Is this legal? Can you employ people like this? Is minimum wage an issue, as they would be employed as freelancers, and they are responsible for making enough to pay their bills.
If they sell 5 jobs at the minimum price per month, their commission will give them more then minimum wage. But that's the incentive, if they sell more then X amount in a month, their commission (for all jobs) will go from 30% to 40%
Of course, any other relevant information you can provide, even if it's not asked for above would be much appreciated.