Ad sales commision rate?

[MajesticLynx]

I'm interested in hiring a few sales guys for my company. Independent contractor commission styled. But I've been stuck at the sales commission rate.

It is a $300ish ad on flyers that get distributed. I've done it personally but I want sales guys to expand my company and sales. I was thinking 20%, about $60 an ad. It is enough for me to maintain a good profit margin, but is it enough for a sales guy to want to do it?

Any info/advice would be appreciated!

[petewilliams]

A couple of quick questions. Are you looking for someone to work full-time commission-only? If that’s the case, you have to work out how many sales they can realistically make in a week. Because if they’re willing to earn $50,000, how many sales does it take at $60 a sale to make that sort of income? That’s one question you have to ask yourself to make it viable for that staff, member or salesperson to actually give you what you need in return for them giving what they need, which is obviously a decent salary.

The other question is what will happen to this business if you didn’t put salespeople on? Would it just die? Because if that’s the case, then you may want to give them a much higher commission structure rather than 20% because it’s a business you wouldn’t otherwise had. That also applies if they’re going out. They’re actually generating the leads for you. If you’re providing the leads and they’re just closing the sale, 20% could possibly work. If you want them to go out and actually generate the lead and generate the sale, you want to give them a much, much higher percentage.

Cheers,
Pete

p.s. This response was actually transcribed and posted by my virtual assistant.

[MajesticLynx]

Business will not die if I don't have sales people. It just won't be very large. I am able to do about 24 ads sold a week. About $1,440 a week, or $70,000+ a year with those commission rates. They would generate the leads too. Much more than 20% than my margins start getting just a tad too low for my liking.

$70K+ a year is pretty decent wage I think, even if they are creating the leads.