Tiered rates

Tiered plans pay a higher rate as a participant sells more in a period. Bitta Commission offers three tiered models that differ in how the higher rate applies. This page explains each model, how to enter the tier table, and how tiers are consumed across a period, with worked examples.

Before you start

• You need the Bitta Commission Plan Designer permission set (BAA Comm Plan Dsgnr) and a plan with a Draft version.
• Progressive Tier, Tiered Rate and Retroactive Tier are core models. No module is needed.
• Tiers accumulate within a calculation period, so the plan version needs calculation periods for its participants. See Calendars and periods.

The setup wizard creates a two-band tiered plan with the style Tiered rates. See Guided setup wizard.

The three tiered models

Model	How it pays	Reprices earlier sales?
Progressive Tier	Each band's rate applies only to the part of the cumulative base inside that band.	No
Tiered Rate	Each sale is paid at the rate of the band the cumulative total has reached after that sale.	No
Retroactive Tier	The whole cumulative base is repriced at the rate of the highest band reached.	Yes

Progressive Tier is often called marginal tiers. Retroactive Tier is often called a retro or cliff tier because reaching a band lifts the rate on everything already sold in the period.

Enter the tier table

1. Open the Draft plan version, choose Components and add or edit a component with the model Progressive Tier, Tiered Rate or Retroactive Tier and a monetary measure basis such as Net Amount or Gross Margin.
2. Choose Rates. On Commission Rates, enter one row per band:

Field	What it does
Sequence	The order of the bands.
From (Cumulative Base)	The included lower bound. The first band starts at zero. Each next band starts at the previous upper bound.
To (Cumulative Base)	The excluded upper bound.
Open Upper Bound	Select on the last row, which covers everything above its lower bound.
Rate %	The band rate, for example 5 for five percent.

1. Choose Save Rates. The app refuses a schedule with gaps, overlaps or a missing open upper bound.

Optional settings on the rate editor:

• Interpolation: None applies each band rate as a step. Linear slides the rate from one band's rate to the next across the band. Linear interpolation applies to Retroactive Tier and Tiered Rate.
• Band Basis (set on the component): bands bounded by the cumulative amount (default), or by the attainment percent of the period target, for example 0, 100 and 150. Percent-of-quota bands need targets, which require the Quotas and targets module.
• Attainment Multipliers: accelerators and decelerators applied to the resolved rate by attainment percent. See Quotas, targets, and attainment.

Worked examples

All three examples use the same table and the same three invoices in one period:

Band	From	To	Rate
1	0	1,000	5%
2	1,000	open	10%

Invoices: 600, then 600, then 300. The cumulative base after each invoice is 600, 1,200 and 1,500.

Progressive Tier

Invoice	Cumulative	How it is priced	Commission
600	600	600 at 5%	30.00
600	1,200	400 at 5% + 200 at 10%	40.00
300	1,500	300 at 10%	30.00
Total		1,000 at 5% + 500 at 10%	100.00

Tiered Rate

Invoice	Cumulative	Band reached	Commission
600	600	5%	30.00
600	1,200	10%	60.00
300	1,500	10%	30.00
Total			120.00

The second invoice is paid entirely at 10 percent because the total reached band 2 with that invoice. The first invoice is not repriced.

Retroactive Tier

Invoice	Cumulative	Entitlement for the period	Earning recorded
600	600	600 at 5% = 30.00	30.00
600	1,200	1,200 at 10% = 120.00	90.00
300	1,500	1,500 at 10% = 150.00	30.00
Total			150.00

When the base crosses 1,000, the whole base is repriced at 10 percent, so the second earning includes the uplift on the first invoice.

Returns across tiers

A linked return reduces the cumulative base. For Progressive Tier and Retroactive Tier, the entitlement for the new base is recalculated and the difference is recorded as a negative earning. For example, a return of 600 from the Retroactive example brings the base from 1,500 to 900, back into band 1, so the entitlement drops from 150.00 to 45.00 and an earning of -105.00 is recorded. The original earnings stay unchanged.

Tier Calculation Details

Every tiered earning keeps its tier evidence. Open an earning from Commission Earnings to see the Commission Earning card, then choose Tier Calculation Details. For each earning you see:

• the evidence kind, for example a STEP row for Tiered Rate, or REVERSAL and REPLACEMENT rows for Retroactive Tier (the old base reversed at its old rate and the new base priced at the new rate),
• the tier sequence, the lower and upper bound and whether the upper bound is open,
• the value in the band, the resolved rate, the calculated and pre-round amounts, and the rounding adjustment,
• modifier rows that explain a hurdle, accelerator, cap, floor, gate or percent-of-quota banding when one applied.

See Explain any earning for the full trace.

What to check if it goes wrong

Symptom	What to do
Save Rates refuses the schedule	Start at zero, use the previous upper bound as the next lower bound, and select Open Upper Bound on the last row.
The rate looks too high on an early sale	Check whether the component is Retroactive Tier rather than Progressive Tier.
Percent-of-quota bands do not calculate	The participant needs a target on the calculation period row that covers the sale date.

Related pages

• Percent of sales, margin, and per unit
• Quotas, targets, and attainment
• Advanced models
• Explain any earning

Tier details show how each band was consumed and priced.