Salespeople like base salaries becuase it makes them feel secure.
Business owners are weary of base salaries becuase they could end up losing alot of money if the salesperson doesn’t perform.
This is why many business owners offer what I like to call a “guaranteed-base”.
The guaranteed-base is a hybrid between a full base salary and a draw. Base salaries are risky for business owners, and most salespeople do not like taking loans out against their performance through draws.
A guaranteed-base states that the salesperson is guaranteed to make a certain amount of money every month – unless they maky more in commissions, and then they would get the higher amount.
The difference between a guaranteed-base and a salary is that commission is included in the guaranteed base, and not added on top like in the case of a salary. The difference between a guaranteed-base and a draw is that the salesperson will always make at least the guaranteed-base amount, regardless of sales, and does not have to pay back the difference as in the case of a draw.
The guaranteed-base amount is usually set at 50% of what a typical base salary would be.
Here are a couple of examples.
#1 – A salesperson makes less in commission than their guaranteed-base:
Guaranteed-base = $3,000
Monthly commission earned = $1,100
Salespersons monthly check = $3,000
#2 – A salesperson makes more in commission than their guaranteed-base:
Guaranteed-base = $3,000
Monthly commission earned = $5,100
Salespersons monthly check = $5,100
This compensation plan is especially helpful when you are working with mid-experience sales people, or have a salesperson in a 3-6 month training program.
The key to making this type of compensation successful is to set VERY clear performance expectations with your sales staff, review their key performance indicators weekly, and fire them quickly if they are not following their KPIs.
Jamar Cobb-Dennard
jamar@jamarspeaks.com





Three BIG Marketing Lessons From College Football
Friday, December 23rd, 2011Well, it’s that time of year again for football fans: college bowl season. From car companies to credit cards, corporate America and colleges from across the land unite and become allies to promote their names, brands, prestige, hype, and oh…I almost forgot, play a game called football.
College football is always a hot topic of conversation, especially with proud alumni from competing schools, but as a marketing professional and student of persuasion, I’m always intrigued as to why people get so fired up and create debate when there are so many other competing options for time, attention, and priorities.
With that in mind, here are three BIG marketing lessons from college football as we enter the season of highly hyped and promoted Bowl games.
#1. Cash is king. Companies of all shapes and sizes spend major money sponsoring everything from naming rights, half-time shows, to other game related promotions in the constant battle to build their brands and force their way into the mind of fans and competitors.
Universities who typically pride themselves as being institutions of “higher learning” and separate from business reverse course during football season and seem to quickly forget why they exist and partner with current and newly created Bowl Games for one central reason: money.
Yes, school pride (Go WMU Broncos – BBA, 1994!) is a major reason cited and spoken by University brass for being a part of a Bowl game, but don’t be fooled by this blanket response as being the main one. At the end of the day it’s not only about pride, but the cash. Football is a huge business in the U.S. and major money maker for many colleges. With a range of revenue streams from merchandise, ticket sales to TV related Bowl payouts; the colleges use the gridiron as much more than a football game with rivalries and school pride, but as a source of revenue.
Now, I’m not saying or implying that this is good or bad, but the fact is universities will often look the other way when publicity and large amounts of money, even from companies they’d sometimes never consider endorsing, are placed before them.
#2. Conversations engage and pull people in. Colleges also love Bowl football games for the conversations they build amongst alumni, current students, and prospective new students and possible ‘blue-chip’ football prospects weighing their university against others salivating to recruit them.
I have to laugh out loud each season how the BCS (Bowl Championship Series) committee denies fans a playoff system and rely on hype, polls, and biased coaches votes to generate massive amounts of publicity, press, passion, and heated conversations. Do you really think the BCS cares or are willing to listen to fan concerns? Are they secretly laughing behind closed doors?
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