Will Salespeople Take a Straight Commission Job?

Posted by Dave Kurlan on Mon, Sep 24, 2007 @ 07:09 AM

Last week I spoke at the Ritz-Carlton in Phoenix and at Barton Creek Country Club in Austin, TX.  I don't recall whether it was Phoenix or Austin where I was asked this question but the question is a good one.

Most who wrestle with this issue are asking the wrong question.  The correct question should be, "How can I get good salespeople to work in a straight commission environment?"

And the issue is not straight commission as much as it is how does the strong, new salesperson earn a living while waiting for the checks to begin showing up?  To address this issue you must know what your ideal ramp-up time is.  My formula for calculating ramp-up time is:

length of your sales cycle + length of your learning curve + 30 days

So if it requires 90 days to teach the new salesperson your business and your sale cycle is another six months, your ramp-up time would be 10 months.  That means that for a straight commission plan to work, you must subsidize the new salesperson for the first ten months prior to transitioning that individual over to straight commission.

© Copyright 2007 Objective Management Group, Inc.

Topics: recruiting

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Best-Selling Author, Keynote Speaker and Sales Thought Leader.  Dave Kurlan's Understanding the Sales Force Blog has earned medals for the Top Sales & Marketing Blog award for eight consecutive years. This article earned a Bronze Medal for Top Sales Blog post in 2016, this one earned a Silver medal for 2017, and this article earned Silver for 2018. Read more about Dave.

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