Author Topic: Sales Pay  (Read 1905 times)

tbone520

  • 5 O'Clock Shadow
  • *
  • Posts: 3
Sales Pay
« on: October 06, 2016, 07:43:08 PM »
Not finding good info anywhere else.  I know it varies by field, but here are the basics:

$3 Million Gross Sales
45% Expenses for jobs ($1,350,000)
1.2% Marketing expenses ($36,000)
13.3% Salaries/Insurance/Commissions/Equipment, etc ($400,000)

$3,000,000 Gross Income
$1,786,000 Expenses
--------------------------------
$1,214,000 Net Profit

I know there will be questions on details, but don't want to give too many.  One individual sales person was responsible for the $3M in gross sales.  What do you pay that person?  $40k base salary and current commissions are included in the 13.3% for the record.
« Last Edit: October 06, 2016, 07:52:24 PM by tbone520 »

Easye418

  • Bristles
  • ***
  • Posts: 472
Re: Sales Pay
« Reply #1 on: October 06, 2016, 08:01:06 PM »
$3M is a small book if you ask me, but too vague to answer.

tbone520

  • 5 O'Clock Shadow
  • *
  • Posts: 3
Re: Sales Pay
« Reply #2 on: October 06, 2016, 08:21:47 PM »
Thanks for the input...  A business pulling in $1M net in a year is small book, yup, in one region.  Glad you have the time to post here making your millions and giving great insight.  It was a question about what to pay someone...

okits

  • Walrus Stache
  • *******
  • Posts: 8896
  • Location: Canada
Re: Sales Pay
« Reply #3 on: October 07, 2016, 02:27:36 AM »
Factors to consider:

- what do direct competitors pay?
- what does the overall industry pay?
- how badly do you want to retain this employee?  What would it take to ensure retention (or to attract a comparable new employee)?
- cost of living in area
- does the amount sufficiently reward the employee for the time and effort expended?  (If bagging $3MM in sales is a cakewalk that's different than working 80 hour weeks, logging months of travel, etc.  You'll want to pay more to encourage the employee to keep up the grinding, difficult work if that's what it takes to make those sales).

Not an exhaustive list, but hope it helps a little!

Easye418

  • Bristles
  • ***
  • Posts: 472
Re: Sales Pay
« Reply #4 on: October 07, 2016, 07:30:16 AM »
Thanks for the input...  A business pulling in $1M net in a year is small book, yup, in one region.  Glad you have the time to post here making your millions and giving great insight.  It was a question about what to pay someone...

Since you can't comprehend it and took offense, I was merely saying $3MM gross sales is nothing, I have people on my team who bring in $100MM+.

Do yourself a favor, think before speaking.  Don't ask a question clearly stating you cannot provide all of the facts.

And please stop crying in your reply, you sound uneducated.


Okits brings up a lot of good points which was captured in my response "this is too vague".  There's a reason no one responded to your thread.

If this is your own small business, my hat tips to you, $1MM is no slouch to bring in profit. I'm just purely saying for a salesman a $3MM book isn't enormous.  Meant no offense.

MOD EDIT: Forum Rule #1.
« Last Edit: October 07, 2016, 09:46:35 PM by arebelspy »

tbone520

  • 5 O'Clock Shadow
  • *
  • Posts: 3
Re: Sales Pay
« Reply #5 on: October 07, 2016, 04:15:37 PM »
No offense was taken.  A question was asked, vague as it might be, and your response had absolutely nothing to do with what was asked. 

You now state you deal with $100M salespeople on your team.  Do you know what their take home is?  What percentage it is vs. the cost to complete the sale and other overhead?  Are these leveraged sales with the client getting loans to buy the product/service?  $3M in non-leveraged cash sales is the exact same as say a real estate broker selling $100M in real estate with only a small percentage of that volume going to commission (~$3M and that doesn't include overhead). It's $3M in cash coming in either way.  I know I didn't state that, I quickly typed up a question.  The $3M in sales are cash and cannot be leveraged.

Employee works roughly 60+ hours per week with about 3 months of travel per year.  Gross pay is roughly $150k built into the 13.3% number. As far as market, top 5 population wise and it's not West Coast or East.  So not top end COL, but still relatively high.  Can't discuss with direct competitors.  Niche product with essentially only 1 or 2 other competitors that can't/won't give that info.  As far as the sales being a cakewalk, that's hard to tell.  The other region(s) with 3 other sales people sells about $2M total with essentially double the opportunity where the product works.   

Regarding the uneducated comment, I would sincerely advise you to remove that filter from your brain.  I have direct relationships with 3 business owners (one family) that are 8 figure net worth people, with one being 9.  None of these three have higher than a high school diploma.  So technically they're of limited to basic education.  The reality is there's always someone doing better than you, that's done more with their life, that started with way less than what you had.  I like dialogue and back and forth, but calling someone uneducated is simply unnecessary and contributes nothing to any conversation.