Working on straight commission - Page 2

I had a roomie in college who fell for this scam. It's a pyramid scheme. He was constantly trying to get me to be one of his "associates" by telling me about all the money he would make. What a jerk. I'm glad he got his girlfriend pregnant and had to drop out, good riddance.

I've been a victim of this sales pitch before. Always from a friend who just can't seem to get it together. I offered them a job and they said..."Man, I'm going to make SO much money with this phone thing..." A few months later they say "Oh that? I forgot all about that. I'm in cosmetics now..."

Many sales jobs can be very heavy on commission which isn't a bad thing if you can make it rain. There are people out there who work in sales that will make more money during their career than 99% of this forum ever will. Sales can be extremely lucrative if you're good at it and you'll always be in demand.

However, any job that is 100% commission strikes me as sketchy. I know a lot of jobs have a 60/40 or even 40/60 split but 100% commission usually tells me that either:

1) You're working for a shady outfit,
2) You"re selling crappy products.

Both of which are not good.

agree with all of this

100% commission with a huge "Book of Business" may work, but if you are just hired and then released to make your own territory can be a very hard go, especially in this economic climate.

Some companies will start you out with base + commission until you can make it work at 100% commission.

I know that some people thrive under the pressure of a full commission package but I feel that they are the minority. I have always prefered to have a base package that can cover your costs then have the bonus/commission to help you keep the lifestyle that you may have become accustomed to.

as a sales manager, if I had people on 100% commission, I would treat them pretty much as a commodity - why train them? why worry about them at all? how could I trust them to keep the good name of the company and the brand in their interest, if I am not paying them a base?

Yep, to me this is pretty much the key point.

The company has zero investment in you. Why train you? Why treat you fairly? Why not hire 100 other people to work your same territory? It makes no difference to them.

Companies typically do this either because they are sleazy or because they don't have any money. Neither of these is a great scenario. That's not to say it definitely can't work, because some people do make it work (sounds like maybe it's working OK for the OP) but in the long run remember again that the company has no investment in you.

Yeah - it takes time. When I first got into commerical real estate one of my guys told me that: year 1 make no money and put up own money to live. year two almost break even year three make a few bucks. year 4, turn a profit, and year 5, make more than you have ever made it before.

If your going to do a 100% commission job, you need to have enough money to live for a while. You can get a draw, but thats just robbing peter to pay paul. Base + commission is the way to go.

I couldnt hack it. I needed the salary, the benefits and the ability to say fuck it and leave at 4.30 some days instead of being made to feel guility I wasnt working 98 hours a week.

Because this is a clothing/style forum, I should mention that a lot of luxury clothing companies are changing to 100% commission pay structure. I've worked for two of them in my career, and I won't say who they are, but they are extremely large stable companies. They refer to it as a "culture of sales". The first one I wasn't as good at my job, but the second one I pulled in five figures some months. What's already been said about good months and bad months is definitely true. It's also true that there are some really shitty companies who work with 100% commission but in the OPs case it sounds like they were a small company that couldn't pay him base outright so they started with commission. Sounds like OP is good at his job, so if it's a good company culture he should stick to commission. The ceiling is way higher pay wise. They're probably switching to Base + because they can afford it now and it will save them money. the !00% commission is probably a system they're just grandfathering and all new employees will be put on the new system, on a guess. I run my own startup and at this early stage we would definitely do the same thing for sales people. You can get them with 100% commission cheap early on, but it can get expensive when they get a share of all of their sales as you grow larger so it's a good idea to move them to a base. That's my 2 cents +

you're the fucking devil.


if you pay your guys 100% commission, and then you change it when they sell so much that it is expensive for you, you are exactly the type of sleazy company that I was talking about.

I can understand that there are companies out there that can't afford to pay people the way they should, that happens. at this stage in my life I wouldn't want to work for them. actually, I wouldn't even suggest to younger people not to do it, because often you can get a lot of experience but no training or mentoring) from companies like that. but they aren't serious companies.

I would even suggest that "luxury" companies that work on that model suck, too. they run the risk of damaging their brand name, and, frankly, that is their only asset.

I don't want to get into a heated debate on this, but managing a company's expenses certainly doesn't make you the devil. If my sales guys are making a 50% commission when we're starting off and sales are small, I'm just trying to make ends meet for both of us, but when sales are increased 10 fold, in part because of all of the money we're spending on marketing, you can bet we're going to move to a new system as the business realities change. Doesn't mean we're trying to screw them, but the system that starts them off making $50 000-100 000+ has to change when we're moving from 2 sales guys to 100 and those two guys are now making $500 000-1 000 000+. Stock options make sure they're still rewarded for risk. Having worked on 100% commission for several years, and also on other systems, I prefer the 100% commission. I made WAY more. It rewards performance more noticeably. Same reason why I would prefer running my own company to working for someone else. I believe more in my own abilities than in a company that's paying me the average of what they think their employees' abilities are worth. The companies I've worked for are probably a couple of the most respected outfits you could work for. Particularly one that every American is familiar with. The guys that damage the brand name get canned. I'm going to leave it at that.

About 75% of my pay comes from performance based bonuses. I would set a goal for yourself of having at least two months rent or mortgage payments set aside (even better, two or three months living expenses). You might not need it, but you will sleep a lot better knowing it's there.

Heh, beat me to it.