How to Win with a Commission Only Sales Plan

Build a business or career through commission only sales or sales agent compensation plan.

In a flat market or when the economy shrinks, the interest in roles that pay only a percentage of order value rises. Commission only sales may be a more attractive route to market.

When salaried jobs are scarce, salespeople are more willing to consider opportunities that are paid only on results.

In a downturn, more employers would prefer to pay higher rates for results rather than carry the risk of hiring people.

Pay per sale is much more reliable than pay per click. There is no sense in fighting the tide when profit for both lies in meeting the immediate need.

Successful 'commission only' salespeople make more money than those with a base salary. Companies who make such relationships work, have more flexibility, can be more agile, and are more resilient.

Individuals can make a success of 'pay by results' compensation and earn an extraordinary living.

Vendors can enjoy the best of both worlds by building a loyal salesforce that is only paid when a sale is made. The following principles and practices work for employers as well as those who only pay for results; they work for employed staff as well as those who operate as a sales agent.

As the employer or the salesperson, the requirement is the same – certainty.

Those contemplating a sales agent role need certainty that it will generate sufficient income quickly enough to pay overheads and living costs.

Companies who are contemplating an increased reliance on commission only sales need certainty that the those they recruit will generate the required results.

Forethought, planning, and preparation reduce the risk. At least half of a salesperson’s success lies in choosing what to sell.

  • First, it has to fulfil a need that is significant to the target customers.
  • Secondly, the proposition – a combination of the offering and the terms of supply – must be differentiated and have a unique appeal to a subset of the target customer base.
  • Thirdly, the salesperson must have reasonable access to the potential customers.

Salespeople must be able to meet their minimum income requirements so it is essential to know the average conversion rate or to have evidence that the expected levels of success are realistic.

Most independent agents are not expected to spend on marketing however they may be expected to find their own customers. If this is the case, the process by which they are to find prospects must not be left to chance or individual creativity. It must be defined and credible if a business is to attract the right candidates.

The target market, sector, or niche must be clearly identified, the ideal prospect organisation clearly profiled, and buying personas characterised. Those with talent and relevant experience may be able to divine their own prospect list and identify buying persona characteristics for themselves however, such ideal candidates are few. Employers must sell their proposition if they are to attract those with the right qualities. The discerning candidate who interviews the employer is much more likely to succeed. 

The vendor or employer should define a reliable method for discovering the right prospects and buyers. Doing so will increase the attractiveness of commission only sales. In addition, it will increase the effectiveness of employed salespeople.

For a sales agent relationship to succeed, vendors must eliminate or diminish barriers. They must provide the seller with succinct and convincing answers to the top six customer questions. The six questions are those that buyers have in mind when contemplating any important purchase.

  1. Who are (company)?
  2. What do they do for their customers?
  3. Who are their top customers and what have they done for them specifically?
  4. Others offer the same things, how is this company different from the others?
  5. We have been let down by others. How do we know this company will do what they say they will?
  6. How can we be sure that we are getting good value for money?

It is easy to answer these questions with platitudes and reassurance however; the only truly satisfying responses consist of end to end verifiable facts.

If an employer can't articulate effective answers, a commission only sales person has no chance except to make up their own answers. Made up answers are usually the kind that can't be verified and inevitably raise resistance.

The only solution is for the vendor to prepare fact based verifiable answers to these questions and then ensure that their salespeople and sales agents learn them.

Facing objections is an inevitable part of selling. There are two points in a sale when objections are commonly thrown up, at the beginning and towards the end.

This is another area where forethought, planning, and preparation can make all the difference. Employers need to provide credible model responses for all common objections and then have salespeople practise using them.

Not all selling engagements follow a predictable path yet having a framework dramatically improves transparency, predictability, and manageability for both salespeople and their employer. Once a common process is identified, it becomes much easier to address obstacles and choke points that derail some campaigns. Once obstructions are recognised, solutions can be developed.

Employers who have a comprehensive understanding of their selling process, the obstacles that disrupt it, and practical solutions for overcoming each obstacle are in a position to help their sellers succeed. Compiling this vital knowledge into an accessible guide, gives salespeople a significant advantage over competitors.

From a salesperson’s perspective, success lies partly in choosing what to sell. Testing potential employers for solutions to each of the aspects discussed above will highlight the best opportunities.

Employers who have invested sufficient forethought, planning, and preparation will attract better candidates however they are compensated. As Tom Peter’s put it, “The only reliable source of competitive advantage, is to get better faster than your competitors.

Watch this short video for details of the Sales Success Formula.

Article by Clive Miller

If you need to build a business through commission only sales staff, or if you want to build a career as a sales agent, we can help. Telephone +44 (0)1392 851500. We will be pleased to learn about your needs and talk through some options. Send an email to custserv@salessense.co.uk for a prompt reply or use the contact form here.

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