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Glossary Terms
Compass - The Only Sales Glossary You Need
Commission-only sales agents are sales professionals who earn income solely through commissions, based on the sales they generate, without receiving a fixed salary. This compensation model incentivizes agents to focus on high performance, as their earnings are directly tied to the volume or value of the sales they close.
Commission-only sales agents are salespeople who don't receive a base salary. Their entire income comes from commissions earned on their sales. This means they only get paid if they successfully sell something.
Using commissions only for sales teams carries risks such as
If goals are unclear or compensation is delayed, trust and performance can decline. To mitigate these risks, companies must offer transparent policies, solid support, and fair, competitive commission plans.
Commission-only sales agents bring several advantages that make them ideal for cost-conscious and growth-focused businesses:
The common pitfalls are as follows:
Businesses often choose commission sales agents to reduce fixed labor costs and incentivize high performance.
Since these agents are paid only when they generate revenue, companies face lower financial risk while motivating agents to close more deals. This model is especially useful in industries like real estate, insurance, and direct sales.
Evaluate the performance of the commission-only sales agent in the following way:
Manage and motivate the commission-only sales agents in the following way:
To pay a commission-only sales person, define a clear commission structure based on closed deals or sales volume. Determine whether you’ll pay a flat percentage, tiered commissions, or bonuses for exceeding targets.
Payment is usually made monthly or bi-weekly, depending on the sales cycle. It's important to track sales accurately and provide timely payouts to keep commission only sales reps motivated and loyal.
