Commission Structure

Commission structure, I think is key to your employee performance and before you can really, in my opinion can have a great commission structure, you have to understand your numbers. So, it comes back to understanding your numbers and your performance in the stores by employee and if you understand what those are, now you can have a commission structure that benefits your business and will make you more profitable. Sadly, what I’ve seen is commission structures that have been around for eight or ten years or longer and they revolve around commissioning sales of an item. Well, if I sell a Rolex that I bought for too much money and I sell it at a loss, but I commission the salesperson to sell it, did I make more money or did I make less money as a business owner? So, you have to understand, that’s just one piece of what I think a commission structure should include. But, what helps you make money? What makes you profitable? What brings customers into your store? What gives you a higher gross profit? All those things should be blended into a commission structure and you have to understand your numbers to create that commission structure, that’s something we help our clients understand and execute on a regular basics.

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