Posts belonging to Category Compensation

I Need My Money! A Practical Guide to Getting Paid- Part 1!

I recognize that the best sales jobs are still hard to come by.  There are still sales professionals that are changing jobs, and make no doubt about it, they are having to negotiate their salary.  I think these tips will help you whether you new or a veteran.  Good proven techniques for you to benefit from!


The interview skills that you honed have been superb, and your ability to stay focused during the group interview was exemplary. The list of accomplishments on your resume gave you credibility, and your vision showed well.

Now, you have the pleasure of being selected for the job you coveted. Job one now is to make sure that you get a “deal” that you can live with. Too many sales professionals have avoided the discomfort of negotiating, which should be what you do best, and have settled for something that they later regret.

Salary- Know the Landscape

There is nothing more compelling for a sales professional than getting paid what they are worth. In order for this to happen for you, you need a brief education and awareness of the salary landscape. Getting what you deserve requires this understanding, as it is the basis for your ability to effectively negotiate. This requires some background, some homework, and a little bit of intuition.

The good part is that if you’re currently an employee of the desired company, you most likely have knowledge of their compensation. Also, the databank of information that you have accumulated during your business and sales career, no matter how long it has been, is useful.

One useful yet controversial “tool” that will help to define the landscape is called Glass Door. Many professionals from numerous occupations use this tool, and it is abused by just as many. One of the most common uses is to determine a baseline and as I explain further you will have better understanding of Glass Doors’ worth and veracity. I will provide a link to Glass Door’s site below, but first let me give you some caveats.

Glass Door depends on user/member reporting to build its database of information. Each participant must give up some information on himself or herself before having full access to the information provided by others in this database. It is extremely popular at this time, yet is probably to some degree a good place for “liars poker” as well. With that in mind, I suggest you take it with a “grain of salt.” It does not mean that you can’t use this in your quest for information, but you do need to do it with an understanding of the limitations of the tool.  You can get to Glass Door by using this link, or putting in your browser.

Glass Door gives you salary information on a number of different positions, including those involving sales and service. Interestingly enough, that may include sales positions at your current employer, as well as sales positions at your prospective employer. It also factors in your geographic area as well.

This gives you a jumping off point, as you look to understand what sales professionals of like experience and position will make. Keep in mind the Glass Door is not limited to sales.  This tool gives you more information than salary, but…keep it in perspective.

Before we leave this brief discussion on salary expectations and requests we should also recognize that the salary probably should not be your driving issue. You’re driving issue probably should be total compensation, and that should will be driven by the strength or weakness of the sales compensation plan that you are on. You will need a solid review of the plan to get an idea of your earning potential.  You should ask questions liberally, and I would suggest that you see the mechanics of the plan using some real sales situations.

You should get this in the offer letter.

Lock in your “Conditions”

I will simplify this to avoid confusion. Your “conditions” would be anything that is not salary and not employee benefit driven. This will include the following items:

  • Territory
  • Goal Expectations
  • Expense allowance–per diem
  • Company Vehicle
  • Inherited business
  • Inherited prospects
  • Issues regarding assistance and support
  • Expectations on any legal costs and issues regarding any non-competes or contracts

These items are important as well, and need to be negotiated just like the salary. I call them conditions because they are a condition of the agreement that should be observed by either party.  These are part of the employment agreement and should be discussed and recorded.

Above all, get it in writing.

Lock-in your benefits

This is ultra important, not because it makes the job any less difficult, but because it makes the working conditions palatable.

I would include in that discussion the following items:

Personal days
Employee Benefit Issues

You may not be negotiating employee benefit issues as they should be going “by the book”, yet you should get definite clarification on these issues and have a meeting of the minds as you will feel abused if you lose a dispute about these in the future.

Above all, get it in writing as no one wants to hear what you understood to be the deal; they want to see the agreement.  Remember, as you have heard before, it is not what you know; it is what you can prove!

The Power of Commitment

I think that you know my sentiments reducing all agreements to writing.  It is best for both sides.  You should also be prepared to live with it.  You negotiate for a living, and this is the most important negotiation that you are going to be involved with for years to come.

Do your homework, and be knowledgeable.  Close the deal and get to the business of selling.  No one likes surprises!

Next Post will cover the actual salary negotiation.  Knowing the landscape definitely puts you in position.

Good luck and good selling.

We welcome your comments.  You can reach me at

Know How You Get Paid! It’s About That Paper!

The most important aspect of a sales job is getting paid.  In the end it is about that paper! I am not talking about the money type of paper; I am talking about the written remuneration or compensation plan.  That is the most important paper out there.  Getting paid is important; as it is one way to keep score, yet it is also the way we eat and keep our families happy.


The objective of this post is to give those who need to know a basis to understand the basic remuneration systems in an easy, no nonsense way.  What is more important is that you learn your company’s system and “work the hell” out of it.

Remember, it is your right to work the system, yet also, it is good policy on your part to keep your activities in the spirit of the system as well.  Working the system is not cheating, and if you are within the spirit of the system, and you will still get your reward.

An important note for all remuneration/compensation stakeholders is that whenever commissions are involved, care must be taken to realize the volatility that can exist.  Sometimes this uncertainty is beneficial (higher earnings), and sometimes it can be detrimental.  In the end, as I said, it’s about the paper, but also the confidence you have in the company’s products and your own abilities.

7 Major Types of Compensation Methods

Companies have the right to do whatever is legal and makes sales happen.  They can put together a variety of different types of plans that stimulate gross sales, retain sales professionals, promote particular products, develops territories, etc.  There are significant numbers of Black sales professionals in each of these type of arrangements with many prospering.  Your ability to take downside risk will determine how you feel about these.

Having been involved in the design and approval of compensation plans from a company standpoint, much thought goes into them, as once they are out there, they you are stuck with them for the prescribed term.

Here are examples of the most popular and widely used plans:

Salary – You have a simple formula to operate under, yet no incentive to excel other than a performance review.  Salary is safe and secure with no upside.

Straight Commission – No base salary, no upside limit, and the downside can be “$0 dollars”.  The risk is with you, yet if you excel, and you must to work under this system, the “force” is with you.

Draw Against Commission - In this one, you have some subsistence in the form of a ‘draw’ providing an advance of commissions with an agreement to pay it back if you do not ‘earn’ it.  The employer is essentially loaning you money against your commission income.  You get the benefit of some subsistence but still have the risk of an downside and the benefit of an upside.

Salary Plus Bonus – A pay system sought after by many professionals as it provides a solid floor, while providing significant upside earnings paid periodically, often quarterly as a bonus.  Often using the components of a straight commission system to help determine the bonus amount.

Base Plus Commission – Similar to above, this is a popular method, tried and proven.  Fixed base salary with commissions paid on the system quarterly or more often.  Commissions are usually based on percentages of dollars sold.

Variable Commission – These are straight commission schemes that have percentages that vary with product, size of the sale, attainment of goals, etc.  Much depends on what the company is trying to promote.

Residual Commission – Commissions that are paid based on customer longevity once initiated.  Aggregate residual commissions can form a solid ‘base’ which provides a good income, and some stability.

There may be other methods of compensation, but usually it is based on some variation of one of these arrangements.  In almost all cases the compensation plan is in writing, and available to all sales professionals for study.  Don’t forget to study this item and even have discussion with some of the more experienced sales professionals in your sales unit.  You will want to know the nuances of this plan that makes for higher earnings.

How Much Guts Do You Have?

Obviously these different arrangements involve different risks.  Hands down the straight commission set-up involves the most risk and highest instability.  It is sales compensation in its purest sense.  You sell and you get paid! I never worked nor managed in a system like this, and recognize that many of you do.

There are combinations of these elements that make for remuneration systems that need the ability to emphasize particular objectives.

Example 1. A salary + bonus system that wants to reward customer longevity attaches a component which uses residual commissions to strengthen the bonus.

Example 2. A variable commission changes your percentage on sales of a certain product based on reaching a certain level of sales.  Let’s say you receive 8% commission on the first $100,000 of sales of widgets, which increases to 12% for all sales thereafter.  Once you reach the 100,000, you are rewarded with more from your great work.

Yes, It’s About that Paper!

I would make the suggestion that you get your organization’s sales compensation plan in front of you and study it.  Do the brief interview with your sales comrades to determine how to maximize it.

There are times that the organization’s objectives, and the compensation or remuneration plan are not in concert.  Rewarding the sales of products that are not profitable, or are in low supply are examples.

Know the plan and formulate your objectives and you can work efficiently and effectively by maximizing your efforts and your income.

Be effective! Your comments are welcome. You can meet me at