Today Justin breaks down how he is handling sales compensation at LeadFuze and Greg talks about cautiously exploring bartering for services.  

Justin originally had a straight commission structure for his two sales people, but found major pitfalls with trying to track ongoing commissions in multiple deals.  He reevaluated what he was doing and developed a new structure.  It includes these components:

  • Offered a base pay instead of straight commission
  • Encompasses growth potential and offers new titles to salespeople as they progress
  • Monthly pay of $1,000, paid weekly
  • Provides for 80% commission on the first month payment and nothing ongoing
  • After 50 total deals and 25K a month MMR closed, title changes from Business Development Representative to Business Development Specialist and when those numbers are met, commission goes to 100% on the first month
  • At 150 total deals closed and 75K a month MMR, the commission rises to 125% on the first month

Justin explains how he mapped out the structure based on forecasts that encompass the sales person’s potential deals over the course of of time.  So far, he sees the benefits to his structure as no ongoing commissions and easily trackable.  He feels at some point the focus shifts to customer retention and the customer success team.

Greg discusses mutually beneficial bartering, or executing services for customers in exchange for their services.  On episode 52 of Zero to Scale, Greg talked about entering into a bartering exchange with ConvertKit and he follows up the discussion on that.  While Greg is usually not inclined to enter bartering agreements he feels there are certain conditions that favor consideration of bartering.  Those situations should be judged on things such as:

  • Consider how much time a barter agreement will require you to invest
  • Be sure that the exchange is of equal or greater value to you

Greg explains how his barter exchange with ConvertKit results in a good exchange of value.      

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