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View Poll Results: What is the right amount to pay based on the question below...
$15 per sold client per month 3 13.64%
$20 per sold client per month 5 22.73%
$25 per sold client per month 7 31.82%
$30 per sold client per month 5 22.73%
Just get Gaz to do it for free! 2 9.09%
Voters: 22. You may not vote on this poll

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Old 09-16-2009, 01:11 PM  
AustinChief AustinChief is offline
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Sales commission advice needed... NEW SUBFORUM SETUP FOR THIS!
OK background: I just started a new business that is taking off in Austin and is launching next week in Dublin and Belfast. I plan to expand to other cities but will need salespeople and am wondering what a fair compensation is.

The job is quite easy, it is a service that is sold to a bar, restaurant, or similar venue... the service is very cheap (~$100/month) and is currently being VERY well received (i.e. selling itself, at the least a very easy sell).

Based on the above... what is a fair commission per sale? I plan for each sale to CONTINUAL pay out to the salesperson as long as they remain a customer... this encourages the salesperson to maintain the relationship and gives them a nice residual income should they decide to move on at some point.

My gut tells me the proper price point is between $15-$30, which works out to $1500-$3000/month in CONTINUOUS income once they have sold 100 clients (the LOW, LOW, LOW estimate for any given region). The more realistic estimate is in the range of 200-250.. so to play it safe.. they SHOULD be able to build a client base to 200 and earn between $3k-$6k /month

OK! Now ..what is the EXACT figure that seems the most FAIR and will be able to attract competent salespeople without being exorbitant?

Poll to follow
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Old 09-16-2009, 01:52 PM   #31
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Question - are you charging fees for people signing up as reps? Are you charging them for the literature they leave behind?
Nope on signing up. Yes on literature. but it is simply business cards and pamphlets.. if needed I guess I could pay for those and have them pick them up at officemax or wherever I have them printed.
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Old 09-16-2009, 01:53 PM   #32
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Since the salesperson would be an independent contractor receiving no salary or other benefits, I think you have to go the $30.

BTW, are you viewing this as a full time position?

If it turns out to be as easy as you think it is, you might be able to reduce the pay to future hires.

Let me know when you get to Albuquerque. I love easy money!
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Old 09-16-2009, 01:55 PM   #33
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I think this is more the route i am going... sortof. Currently the structure is this...

1 time SETUP fee of $100 and $100/month
OR if they sign a 6 month deal we waive the setup fee
OR if they sign 1 year we waive the setup and charge $1000 for the year.

Now for a salesperson I could see

...a 50/50 split on the setup fee +20% ($50+20%=$290/year) ~24%

OR on a 6 month deal they get $125 ($125+$125=$250/year) ~21%

OR on a 12 month deal they get $225 ($225/year) 22.5% (although it is only ~19% of the undiscounted rate)


Yeah but that is a secure 12 month deal, so its okay.

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Nope on signing up. Yes on literature. but it is simply business cards and pamphlets.. if needed I guess I could pay for those and have them pick them up at officemax or wherever I have them printed.
Eh hem....If you need printed supplies, let me know. Thats what I do. Office Max is a big ripoff.
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Old 09-16-2009, 01:55 PM   #34
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Originally Posted by AustinChief View Post
Nope on signing up. Yes on literature. but it is simply business cards and pamphlets.. if needed I guess I could pay for those and have them pick them up at officemax or wherever I have them printed.
Just keep it reasonable... so, when do you share the details on your li'l venture?
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Old 09-16-2009, 01:57 PM   #35
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Depends on how valuable the service is. If you're willing to invest $1200 a year into a software program that is greatly going to help your business, $195 up front is nothing. And honestly, when I was doing poker in bars the first thing bar owners asked me was the up front licensing fee. They expected it. It was a lot easier to sell when I told them there wasn't one, but I could've got them on one if I'd pushed it.
That is actually the kicker... the owners/managers I have spoken to that GET IT, have ALL agreed that $100/month is way too low to charge... BUT knowing that MOST will not get the value right away... I am setting the price point low enough to make it a no brainer for most.

For people that are genuinely interested... shoot me a PM and I will discuss it in further detail if you want. I am hoping to get this rolling nationwide fairly quickly. Kinda funny that my first expansion market is overseas...
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Old 09-16-2009, 02:03 PM   #36
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Old 09-16-2009, 02:05 PM   #37
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Old 09-16-2009, 02:07 PM   #38
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If you need a strong representative in the Phoenix/Scottsdale market drop me a line.
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Old 09-16-2009, 02:08 PM   #39
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That is actually the kicker... the owners/managers I have spoken to that GET IT, have ALL agreed that $100/month is way too low to charge... BUT knowing that MOST will not get the value right away... I am setting the price point low enough to make it a no brainer for most.

For people that are genuinely interested... shoot me a PM and I will discuss it in further detail if you want. I am hoping to get this rolling nationwide fairly quickly. Kinda funny that my first expansion market is overseas...
I'm dead serious. I'll shoot you a PM. We can lock Seattle/Portland down.
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Old 09-16-2009, 02:10 PM   #40
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I sent a brief PM. I get home around 4pm PST. Let me know if you want to talk in more depth. I know you're still working on getting things together, but whenever you're ready I am.
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Old 09-16-2009, 02:14 PM   #41
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I vote the $30 option.
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Old 09-16-2009, 02:17 PM   #42
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OK, without getting into details publicly (want to hold off on that for a bit).. the structure is as follows...

you have 3 layers to the business...

sales - duh
maintenance - the BULK of the work
development - ME! (this is where most of what makes the service very hard to replicate easily come from)

a very ROUGH estimate of compensation is as follows...

20% sales / 60% maintenance / 20% backend, devel, support, etc

In Austin, I am all three at the moment... (hot saleschicks in the area are welcome to apply at all hours)

In Ireland this is split into a saleperson in Belfast who gets 20% a saleperson in Dublin who gets 20% and the maintainer who gets 65% (the extra 5% is because they have to handle more of the business than normal due to being in a different country and whatnot) and finally the backend gets 15%.

As this (hopefully) expands to more cities this can be split into 2+backend or 1+backend ... depending on how much a person want to handle.

For example, I PROBABLY have someone lined up for Boulder/Denver. He will handle sales AND maintenance and receive 80% of each sale. (not sure what percentage of setup fee... either 80 or possibly 100%)

The great thing is that if I don't have a maintenance person in that town (preferred) I can handle it all from here. There are no ONSITE visits required.

The maintenance side of thing is very very easy, but does require being "on call" (near a computer with internet) most of the time.

If anyone thinks it's a good idea.. I can setup a conference IM or chat .. I just don't want the details out just yet.. it isn't ground breaking.. but it's better left unpublished for now.
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Old 09-16-2009, 02:22 PM   #43
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That's the deal. I would be interested in sales/maintenence. I'm a relationship developer, and not only is it added income, but it's an opportunity to keep that relationship strong every time maintenence is required.

Obviously as things blow up, you're going to have to have someone fill the 2nd role. Again, choose wisely.
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Old 09-16-2009, 03:02 PM   #44
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This isn't one of those bar-type Bible Trivia games, is it? I don't know anything about Dublin, but I don't think that will fly here.
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Old 09-16-2009, 03:05 PM   #45
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ok, anyone interested in me setting up a private chat room and going over the details of this? Let me know and I will get one going and PM the address to you guys.
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