Let’s take a good look into the process of commission management from the eyes of a sales manager. We all know that businesses all around offer sales commission to their reps in order to keep the reps hyped and motivated for the work. Sales reps are assigned a certain sales quota by their sales leader and at the same time are allotted a time frame within which they must achieve the sales quota assigned to them. On successful attainment of the assigned quota the sales reps receive a commission which can either be monetary or non-monetary i.e., it can either be a financial token like a bonus amount or it can be a non-financial token like a prize, a gift hamper, a paid holiday or anything that the sales reps consider worthwhile and are ready to receive whole heartedly. This is all a part of the spiff program which intends to boost the sales performance for the business by offering intriguing commissions and incentives to the reps.
SPIFF is an acronym for Sales Performance Incentive Fund (often pronounced with an extra F for a certain reason). A spiff is like any other incentive paid out by the businesses to their sales reps. It comes handy when you are looking forward to achieving a short-term sales goal for your business.
An insight into the sales commission pay out
Companies assign the sales managers and leaders with the job of looking into the calculations of commission statements and pay out of the commission to the reps. A detailed and full-fledged commission plan is made at the beginning of a fiscal year with estimated growths and performances of the company. It is then looked after and made sure that the company performs according to the plan and ensures exponential and relative growth with reference to the plan.
The commission plan includes a wide range of considerations and is made after a lot of thinking and planning. There are two methods of commission planning; Manual commission planning through spreadsheets and commission planning through commission management softwares. A commission plan includes a sales commission tracker which is used to track every unit of sales made by the reps. The records are then maintained and are further used to calculate the commission statements and the sales performance of the business, it is through this tracker that the business also calculates the profit.
An insight into commission planning and managing through commission softwares
Spreadsheets were earlier used for commission planning but due to the repeated complexities it became outdated and businesses started shifting over to commission management softwares.
- Spreadsheets are prone to errors and miscalculations and hence a commission management software should be brought in use because of the higher accuracy rates they offer.
- Flexibility is trivial but can be a major issue lacking in your commission plan. A software would offer flexibility in its plan and would help you build an effective and suitable commission plan which would stay put under any circumstance.
Using a software for the commission management purpose would ease all the workload and increase the productivity of the reps and the business. The manpower which you were using in coordinating and managing the commission plan would now be used in some other work adding to the productivity.
ElevateHQ is an excellent software which is one of its kind and has outdone itself in the process of commission planning. It offers features unlike any other. In addition to accuracy and flexibility it also has transparency, data insights and real time exposure which altogether make it the best software available.