Plans and rates
Commission methods
What % of Sales, % of Margin, Margin Band Rate, Amount per Unit and Fixed per Sale pay, with examples.
updated: applies-to: 2.0.0.0
Each component uses one method. This page shows what each method pays, with an example.
Every method starts from the sales line Amount: after line and invoice discounts, without tax, in local currency. The base is that amount, less any deduction, times the salesperson's credit share.
% of Sales
Commission = base x rate.
Example: 10 units at 150.00 with a 20% line discount is 1,200.00. The document has a 3% freight deduction. A base of 1,164.00 at 5% pays 58.20.
% of Margin
Commission = (base minus cost) x rate. A margin of zero or less pays nothing. The cost comes from Commission Costs, the item or resource card, or the sales line. See Rate lines and costs.
Example: 10 units sold for 1,000.00 with a commission cost of 52.00 each. A margin of 480.00 at 20% pays 96.00.
Margin Band Rate
The margin chooses the rate, and the rate is paid on sales. Set the bands with Margin Bands on the component. A band starts at From Margin % and runs to the next band. The lowest band also covers anything below it.
Margin bands: the higher the margin, the higher the rate on sales.
Measure Margin Over chooses which margin picks the band:
| Setting | Margin used |
|---|---|
| Line | The margin of each line on its own. |
| Document | The margin of all lines of the document together. |
| Document per Commission Group | The margin of the lines with the same item commission group. |
Example: from 0% margin the rate is 2%, from 20% it is 4% and from 30% it is 6%. Line A sells 3,000.00 at a cost of 1,800.00 (40% margin). Line B sells 1,000.00 at a cost of 900.00 (10% margin).
- By Line: 180.00 + 20.00 = 200.00.
- By Document: the margin is 32.5%, so 6% of 4,000.00 = 240.00.
The rate lines of a Margin Band Rate component only decide which sales it pays on. With no rate lines it pays on every sale.
Amount per Unit
Commission = units x amount. Set Unit of Measure Code on the rate line to pay per case or box instead of per base unit.
Example: an item is sold in pieces, and a case holds 12. The rate line pays 25.00 per CASE. Selling 60 pieces pays 5 cases x 25.00 = 125.00.
Fixed per Sale
A fixed amount once per document or once per line (Fixed Amount Per).
Example: 25.00 per document, on an invoice with three lines, pays 25.00. Per line it pays 75.00.
Deductions, customer terms and rate overrides do not change Amount per Unit or Fixed per Sale commission.
Period methods
Some commission depends on a whole month, quarter or year: sales tiers, target bonuses, growth, team overrides and draws. These methods are paid when you close a period. See Period close and tiers.