KWIKKAR

iTrader: (15)

We just opened up a company that has a sales team and want to find out how most of you commission based people get paid.
Alittle bit about the company.
It's a Mobile fleet service company that does PM services and oil changes for companies that have between 5-500 trucks onsite. Basically taking our lube shop and putting it on wheels.

First question, once a sales member setups up the company and locks us in and gets the account how would I commission them based on getting the account or do I even commission them since no service or "money" has been brought in.
Second, Once the account starts to be serviced I was thinking about cutting a percent(trying to figure that amount out) to the sales member for the life of the account.(Or something to that nature) That would keep them wanting to keep the account in good standing and continued to be serviced.
There would be the service techs that would be servicing the trucks which I would have to pay as well, which would range from $8-$10hr plus commission per PM service done.
Any help would be great.

Thanks Jordan

lo_jack

iTrader: (27)

If you have to pay them on cashflows (i.e. right now you have zero to pay a salesperson for anything before you get money from performing work from sales) then your idea about paying them a small percentage for the life of the contract would be about how you need to start. Lots of sales people get paid off collected revenue, not signed contracts. That's pretty common, since you don't want to pay out on something that doesn't actually make you money. I would definitely do it on the life of the contract though, not the account. That way if you lose an account, someone else can still come try to sell them again later without having to pay the original person who probably let them slide.

I am assuming that the rep can sell them different/better services on more or fewer vehicles? If that is the case, consider paying the rep based on a percentage of (number of vehicles times level of service). If they have to maintain the account, then yes they will either re-sign the account to a better deal or worse deal, and get commission on that, right?

You need to figure out what your margins are if you are going to pay a percentage of a contract. Money left over after costs and paying sales people and taxes is all you have left over to pay yourself and grow the business. Figure out your cost structure first, and then see what kind of comp you can do for sales people that won't leave you with no profit but will keep them interested. I think you already started doing that when you mentioned paying your techs. Get a really solid picture of what it will cost you all in to deliver service on a typical contract, and then give the sales person a reasonable piece of the profit. If you don't make money, they shouldn't, and vice versa.


Good luck with your business.

KWIKKAR

iTrader: (15)

Thanks that was really helpful. I just want to make it far for both parties involved and still make some money.

Thanks again.