Excel blueprint title block template1/13/2024 Step 2: Establish Role LevelsĮstablishing your role levels can become a complicated process. It should be easy to measure, easy to administer. All compensation must be fair and equal to everyone. Keep the time between activity and compensation under 60 days.īe Fair for Everyone. Make compensation directly related to the desired effect you wish to achieve. A summary of your compensation plan must fit on a single page. Here are 5 things to keep in mind when planning yours. Step 1: Understand the Basic Requirements of Good Sales Compensation PlansĪ good sales compensation plan is a win-win-win: It’s easy to implement and benefits everyone. Create a Contract and Get Mutual Commitment.Know what to Include in a Sales Incentive Plan.Plan Compensation for Onboarding and Training.Decide Base Pay and Sales Commission Structure.Determine Total On-Target Earnings (OTE).Understand the Basic Requirements of a Good Sales Comp Plan.Whether you’re building a sales compensation plan from scratch or rebuilding an old one, you should take the following steps in order: How to Create a Sales Compensation Plan For New Reps Somes sales compensation plans include only commission, while others include only base pay. Typically it will include two main elements: base pay, and variable pay, sometimes known as incentive pay, or commission. Related: Stop Being Poor: 3 Questions You MUST Ask About Your Comp Plan □ What is a Sales Compensation Plan?Ī sales compensation plan lays out how you are going to pay different salespeople for their contribution to the business. It needs to incentivize specific behaviors and actions that suit the needs of both the company and the customer.Īnd of course, a strong sales compensation plan with generous sales commissions needs to motivate reps to hit goals that grow the company while still maintaining a profit margin. A good compensation plan and sales commission structure needs to provide fair compensation to employees in customer-facing roles. Great sales compensation plans and commission structures need to accomplish quite a lot.
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