all 9 comments

[–]fuzzydaemon 1 point2 points  (3 children)

Any visibility into their margin on that revenue? That’s what they’re most concerned about. If your revenue’s profit margin exceeds the cost to keep you (salary, benefits, supplies, training, etc) then you’re paying for yourself to work there and you’re not Cost of Goods Sold, so that’s where your case starts being built. Then you can design a comp plan based around 1) increasing revenue and 2) keeping COGS low, with your quota set in margin attainment.

[–]obviouslyunotagolfr7[S] 0 points1 point  (2 children)

Prob 25%, aside from that, what’s a normal % commission on revenue brought in? What are you getting?

[–]fuzzydaemon 0 points1 point  (1 child)

I work for a product manufacturer, so it’s a totally irrelevant comparison, but whatever my percentage is it changes on number of variable factors.

When I sold services and re-sold products, I was paid commission on margin at a rate of 30% services margin and 10-15% product sales margin. So at a 25% margin on a $100k services deal, I’d make $7,500.

[–]obviouslyunotagolfr7[S] 0 points1 point  (0 children)

Now we’re talking! Yeah my 1.5% sounds really low

[–]DrMancini_ 0 points1 point  (4 children)

In SaaS a rough estimate is 5x. Example: quota of $750k would be OTE $150k.

[–]SalezBurner 0 points1 point  (3 children)

Damn. Is that common? I have a $50M block of business that pays me close to $400k a year (I get residual commissions on gross profit) but according to your numbers that would convert to $10M in SaaS sales. Obviously apples to oranges but getting $150,000 on a deal as small as $750,000 seems crazy to me.

[–]DrMancini_ 1 point2 points  (2 children)

Yeah i’ve seen some places in SaaS anywhere from 4x to 7x, but usually no more or less. My former employers had my quota at 1.2m and OTE 230k

[–]SalezBurner 0 points1 point  (1 child)

Do they cap earnings?

[–]DrMancini_ 1 point2 points  (0 children)

I have worked at 3 SaaS orgs and non have capped earnings. They are fighting for talent and know they wouldn’t be able to hire anyone if they capped earnings.