Differences in Incentive Pay for Sales Professionals

According to the results of a recent national sales compensation survey released by ERC, organizations determine incentives differently for sales managers and sales representatives. The results show that sales managers receive bonuses and/or commission based on meeting various goals rather than or in combination with gross sales and net margins. Organizations report that bonuses and commissions for Top Sales Executives and General Sales Managers are typically based on a combination of gross sales, net margins, and /or various goals. Incentive pay is determined similarly for lower-level sales managers such as district sales managers.

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By contrast, more organizations report that bonuses and commissions for sales representatives are determined by gross sales or by using a combination of multiple sales metrics than by reaching various goals. In terms of determining incentive pay and commissions, the results suggest that organizations are placing more emphasis on multiple combined sales metrics and reaching various goals for sales managers while more emphasis on straight gross sales is used for sales representatives.

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