Author Topic: Unsure of when/how to pull the trigger  (Read 2991 times)

Bbqmustache

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Unsure of when/how to pull the trigger
« on: September 14, 2015, 06:49:10 AM »
I am in a full commission sales career, but with decent residual income.  Deal coming this year that will allow us to replace my regular job income for a year, fix up our home we want to sell so it is ready to sell, retire all our debt except our house mortgage, and put almost $50K into a "buy a new house" account.

Another deal in January lands me more big money.  In 2017, we should have residual income to replace both of our regular incomes.  In your experience, how much hemorrhaging do you see with residual income year after year?

BTDretire

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Re: Unsure of when/how to pull the trigger
« Reply #1 on: September 15, 2015, 09:11:09 AM »
I am in a full commission sales career, but with decent residual income.  Deal coming this year that will allow us to replace my regular job income for a year, fix up our home we want to sell so it is ready to sell, retire all our debt except our house mortgage, and put almost $50K into a "buy a new house" account.

Another deal in January lands me more big money.  In 2017, we should have residual income to replace both of our regular incomes.  In your experience, how much hemorrhaging do you see with residual income year after year?

I see no one has posted, probably because it is not clear what your question is.
Quote
" how much hemorrhaging do you see with residual income year after year?"
How is it structured? Does it drop as years pass? How likely is it that the commisions will stop?
We don't know anything about your residual commisions. Tell us about them.

Bbqmustache

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Re: Unsure of when/how to pull the trigger
« Reply #2 on: September 17, 2015, 04:43:44 AM »
Residuals received whenever my sales retention is above 55%.  I am told to expect a 70% to 80% after the first year; my question is should we expect a 20% to 30% drop in those particular sales every year, or should the first year be the big hit?  If the drop is that high each year, it means I cannot use this income to FIRE, because if I stop "feeding" sales into the residual income machine, I would see it drift down in pretty short order.  That being said, these are services that clients could should and do keep for the long term

tooqk4u22

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Re: Unsure of when/how to pull the trigger
« Reply #3 on: September 17, 2015, 08:44:18 AM »
Usually when you leave your employer the residual income stops with it. 

Aside from that, I was with one company early on in my career and the sales folks were straight commission, got 25% of profit for their accounts.  Company was sold, new company realized that sales guys weren't selling other than to existing clients (i.e. no new sales) and changed the comp plan to a more conventional corporate model that required new sales.  They all left within a year and none could replace their incomes.

BTDretire

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Re: Unsure of when/how to pull the trigger
« Reply #4 on: September 18, 2015, 10:42:15 AM »
Residuals received whenever my sales retention is above 55%.  I am told to expect a 70% to 80% after the first year; my question is should we expect a 20% to 30% drop in those particular sales every year, or should the first year be the big hit?  If the drop is that high each year, it means I cannot use this income to FIRE, because if I stop "feeding" sales into the residual income machine, I would see it drift down in pretty short order.  That being said, these are services that clients could should and do keep for the long term

  Ya, that's not something we can really calculate,it would depend so much on the the industry, your particular customers, how they are treated after you leave and so much that we would be unaware of.
                                                           Mikek

Bbqmustache

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Re: Unsure of when/how to pull the trigger
« Reply #5 on: September 19, 2015, 01:21:59 AM »
Yeah, looks like a wait and see for me.  Also just found out that agent "fluffed" the numbers in upcoming deal.  Not getting 1500 accounts, only about 550.  Grr snarl, just got to work more.  550 accounts give me decent annual income, but little toward my long term sinking funds.  And initially a bit over $17K in residuals in 2017.  We'll see how my big January deal progresses next month.