incentive/commissions
NaeNae55
3,243 Posts
Not sure if this is the place to post or not, but here goes.
Scenerio:
Sales staff sell various types of benefits to organizations. Most is not direct selling (though there is some), but rather working with insurance companies and brokers to get their products matched to our client base.
Sales staff receives a base salary and a percentage (incentive) of commission revenues brought into the company. The incentive percentage is paid at 3 levels, starting at the highest level for new clients and reducing over time to the lowest level.
Problem: One of the insurance companies offers bonuses (several kinds). For instance, they give a bonus if you sell enough of thier products, or you might get a different bonus if you have a large retention of customers. Each bonus is annual, and can be quite large. When it is paid, every client involved, and the exact amount attributed to that client is listed. We qualified for one bonus because between the sales of several sales staff and a house account (our owner company is the client) we had enough volume. We qualified for another bonus because of the retention of several clients (again, more than one sales staff person involved).
Again, this is a large amount of money. My argument is that the size of the bonus should not make any difference as we should focus on the policy itself. Unfortunately, the size of the bonus is definitely having an effect on management and board members.
One manager says the sales staff should receive the same percentage of the bonus as they do for regular commissions. That is, if they were getting level 1 for that client, they should get a level 1 rate of the bonus. If they were getting level 2, they should get level 2, etc. (If they hadn't done the work, we wouldn't get any bonus, even on the house account.)
One manager feels that it is a bonus, not regular commissions, and the sales staff should not get any of the bonus. (If there wasn't a bonus, they wouldn't have done any less work so they actually did nothing to acheive it...it is our contract with the insurance company.)
Yet another manager feels that the sales staff should get something, but not the regular amount. They suggest about half of the lowest level. (They did something, but not that much as there were many factors and several sales staff involved.)
Do any of you have experience with similar situations? How do you handle? Do you pay the same, ignore completely, or pay at a different rate? I need some outside input of how other companies are handling. Hopefully, this will help resolve the issue.
Please help!
Nae
Scenerio:
Sales staff sell various types of benefits to organizations. Most is not direct selling (though there is some), but rather working with insurance companies and brokers to get their products matched to our client base.
Sales staff receives a base salary and a percentage (incentive) of commission revenues brought into the company. The incentive percentage is paid at 3 levels, starting at the highest level for new clients and reducing over time to the lowest level.
Problem: One of the insurance companies offers bonuses (several kinds). For instance, they give a bonus if you sell enough of thier products, or you might get a different bonus if you have a large retention of customers. Each bonus is annual, and can be quite large. When it is paid, every client involved, and the exact amount attributed to that client is listed. We qualified for one bonus because between the sales of several sales staff and a house account (our owner company is the client) we had enough volume. We qualified for another bonus because of the retention of several clients (again, more than one sales staff person involved).
Again, this is a large amount of money. My argument is that the size of the bonus should not make any difference as we should focus on the policy itself. Unfortunately, the size of the bonus is definitely having an effect on management and board members.
One manager says the sales staff should receive the same percentage of the bonus as they do for regular commissions. That is, if they were getting level 1 for that client, they should get a level 1 rate of the bonus. If they were getting level 2, they should get level 2, etc. (If they hadn't done the work, we wouldn't get any bonus, even on the house account.)
One manager feels that it is a bonus, not regular commissions, and the sales staff should not get any of the bonus. (If there wasn't a bonus, they wouldn't have done any less work so they actually did nothing to acheive it...it is our contract with the insurance company.)
Yet another manager feels that the sales staff should get something, but not the regular amount. They suggest about half of the lowest level. (They did something, but not that much as there were many factors and several sales staff involved.)
Do any of you have experience with similar situations? How do you handle? Do you pay the same, ignore completely, or pay at a different rate? I need some outside input of how other companies are handling. Hopefully, this will help resolve the issue.
Please help!
Nae
Comments
That's a sticky situation, and I think you're right to approach it as an across the board thing rather than dependent on amount. Although you could say they'd get so much percent or so much total up to X dollars and cap out the total amount they could get.
Good luck, Nae.
If anyone else out there has any input, even if they don't pay commission incentive, I would appreciate it. An outside and impartial observance would be helpful.
Nae