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Types of Commission

Updated: May 6, 2022

Let’s face it: pay plays a pretty important part when on a job search. What’s scary is pay structures can be different in different industries. In the marketing and sales industry, employees are often compensated for their performance in the form of commission incentives.

For many people, commission can bring on feelings of worry. However, we are here to tell you there are a lot of perks to working a commission based job and what those perks are.

It can be pretty frustrating busting your butt every day, going above and beyond at a job and then going home with the same paycheck as the coworker you felt wasn’t carrying his/her own weight. Unfortunately, it’s a pretty common occurrence. Doesn’t sound fair, right? That’s one of the great things about a performance based job. If you set out to be the hardest worker, go above and beyond, and learn the skills it takes, your paycheck reflects that. So in retrospect: the harder you work, the more you make.

When it comes to commission based jobs, different companies pay out in different ways. Let’s talk about some of the most popular commission structures:

  • Base salary plus commission: This is the most common commission structure. The main downfall of this is that the commission isn’t usually high enough to see a big difference and in most companies you don’t see a payout of commission until you hit a certain goal.

  • Straight Commission: This type of commission structure isn’t seen as much these days, but the perks of straight commission jobs is that they tend to pay out way more per product/service. However, if you don’t make any sales, you don’t get a paycheck.

  • Hourly pay with commission incentive: With this type of commission structure it tends to be whichever pay is greater at the end of the week. The perks of this structure is that companies tend to pay out a larger sum on their products/services than the ‘base salary plus commission’ structure which allows for bigger paychecks to accumulate faster. It also means that if you have a bad week, you still have an hourly rate to fall back on unlike the ‘straight commission’ structure.

Here at Tri-State Marketing, we operate on hourly pay with commission incentives. We personally feel it’s the best option for our employees. Like we said though, everywhere is different so when looking into working for commission based companies, be sure to ask questions in your interview to get a clear idea of how the pay works for that particular company.

What are some other perks of a commission based job? Well, for one in most places (like here at TSM), there is no commission cap. Meaning if you want to make more than the average Joe, you have the ability to. At no point will the boss tell you you’ve hit your limit and now you’re selling just for fun and probably just filling their pockets. This also means that you have the ability to plan for upcoming events/vacations. Most commission jobs don’t offer paid time off, so being able to make extra on your paycheck helps offset when you need to take days off.

Another perk are bonuses and competitions! Who doesn’t love a little comradery in the workplace? This keeps things interesting and can be super fun. Competitions give you something a little extra to look forward to and potentially earn a little more on that check! Here at Tri-State Marketing we throw up competitions all the time.

At the end of day, there are many pros to working a commission based job. You just have to decide if it’s the right path for you and weigh all your options! Hope this helped clear some things up!

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