Sales Commission for Design Firms?
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- TwinLobe
Does anyone have an idea of the going rate of commission for a small firm/agency? We're hiring a Sales Rep to bring in new business and leads, and want to make sure that we're fair.
My gut tells me that 15% would be appropriate, but I know this figure would vary depending on the size of the agency. We're a very small shop. Does anyone have experience with this?
Thanks in advance!
- epete220
should be 20% unless he gets a better salary
- powertoni0
thats about what the rate is @ my shop....but nobody takes it because it amounts to selling the relationship for a pittance.
- qbnternet0
There should be a variable rate.
Just a suggestion:
20% for new clients
12% for existing clients new work
0% on existing client work unless they are an AE toowith a bonus wrapped into it to meet financial milestones
- airey0
also, make sure the angel of % is for the first job and nothing after (as it'll be up to you to keep the client) or an ongoing % on future earnings through that client. this is a sticking point that's buggered some i know.
- HomeCreative0
I'm in the same boat here.
Anyone have any updates on how the % scheme went?
- Shaney0
we pay 10% flat and once only in London, no complaints. Self employed reps or referrals from other Design co's only though not on staff, all treated the same.
- HomeCreative0
Ok, we have had a mooch about and this is what we have more or less decided for commission on a new sales person:
Basic expenses covered
20% of 1st invoice for new clients
10% of 1st invoice from old/past relationships
+
10% end of year bonus
This would be based on all introduced/found clients total spend. Target spend milestones would be 50k (5k bonus), 75k (7.5k bonus) 100k (10k bonus) etc etc.Anyone think that sounds about right, too little, too much?
- Shaney0
Once they hit the 50k target you give 30% total (20% + 10 bonus) on what could be a one off job..sounds a lot.
You'll get good sales reps tho
- doctor0
I agree with Shaney - that does sound like a lot for a sales rep. About the bonuses, maybe you could just ask him/her which size bonus figures it'll take to motivate them? I'm guessing they won't ask for 10% of the total spend.
- babaganush0
20 % on new clients sounds ridiculously high to me. Although I'm no expert. They're only selling how good YOU are
- gramme0
I'd pay them a salary, that way if you turn down work there are no hard feelings. At the end of the year, give him a sweet bonus if he brings in a lot of business.
- gramme0
^ In other words, I think you'll be best served by a dedicated, full-time new business person who is invested in the well-being of the company, and who furthermore listens when you tell them the specific kinds of clients you want. A part time, commission-based job will likely end in tears or will just fizzle out into nothing. I've seen it happen.
- In fairness, so can the wrong in-house personbabaganush
- True, but I think that's less likely in most cases.gramme
- (If one hires intelligently).gramme
- HomeCreative0
^Cheers gramme, sounds like good advice. Will look into what type of salary will motivate.
Problem is with this one the sales person in question has no creative industry experience and although a good new business person they are taking a leap with me... not sure on this one.
- HomeCreative0
1 & 2 definitely. 3 eeerrrm yes but occasionally with the aid of a electric cattle prod as this is my brother.
- jbarnesco0
If your sales could grow 500K, is that worth 100k, 125k, 150k? These are clients you would have never met or worked with.
Not all principals can sell to strangers...