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Sales Compensation: Tips From The Experts

There's no one best way to craft a compensation plan --– a lot depends on a company's culture and objectives. But here's some advice on how to get started.

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Deal Of A Lifetime

1. The primary principle of sales compensation is to pay the sales representative in proportion to the value of the deal, traditionally measured by a product price.

2. When calculating sales compensation for a cloud service, take the sales commission model you are using and replace the product price with monthly, quarterly or annually recurring revenue.

3. Sales compensation for Software-as-a-Service should be based on the lifetime value of a deal.

4. Sales compensation should be paid up front.

Source: Blog by Joel York at

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