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Do you pay a flat % for a sale Most are going to want a base+commission sort of plan. You basically determine what the position is worth, we'll say it's worth $100K/yr to use a round number. Now, you determine (part art, part science) what the base vs. variable should be, lots of factors go into this, including how probable it is that the person has a decent shot at being successful. Most skilled sales people will also require an accelerator (if they exceed quota by x%, they get a y% bonus on top of the standard comp). Then there is also the issue of recoverable vs. non-recoverable draws, if you do any draw at all (I'd try not to). EDIT: I just realized I left this half-finished... So if the overall comp is 100K, you might say 75K is base, paid like any regular base, and the 25K is tied to revenue. You'll have a monthly or quarterly goal, with the 25K applied in proportion to the revenue goals. Which means that they might earn ~1K in comp Jan, Feb, Mar, $2.5K in Apr, 3K in May, and so on. You can also divide the 25K by 4, set a quarterly all-or-nothing goal, or a dozen other combinations. You'll also need to learn more about sales than it sounds like you currently know to prevent yourself from getting steamrolled by someone who knows how to take advantage of the situation. |