| 09:02am Feb 10, 2003 PST (#1 of 6)
I am researching how agencies in New York City pay sales commissions to new business sales staff. What is the percentage and how is it paid? Any insight to this would be greatly appreciated.
MARY LOU MCCLAIN > director of human resources ---------------------------------------------- CRITT GRAHAM
09:02am Feb 10, 2003 PST (#2 of 6)
we pay 6% commission on first year gross revenue and 3.5% on year two and three
Steve Orenstein Kern Direct Woodland Hills, Ca
09:02am Feb 10, 2003 PST (#3 of 6)
I'm sorry but when you say gross revenue do you mean gross profit? Example: you bill a client for $100.00 Gross radio buy. With an industry norm 15% commission, the gross profit is $15.00. Is the 6% on the $100.00 or the $15.00. If it is on the $100.00 you are paying your employee 40% of your profit. With any incentive or commission plan we always work from Gross Profit which is for the example above: 100 - 85 = $15.00.
Brian Woolard O'Brien et al. Advertising
09:03am Feb 10, 2003 PST (#4 of 6)
Is there a base salary as well?
-- Jean Kl»ndt Kl»ndt Hosmer Design www.klundthosmer.com
09:04am Feb 10, 2003 PST (#5 of 6)
no base salary
Steve Orenstein
09:04am Feb 10, 2003 PST (#6 of 6)
we are a direct response agency we pay the 6% on Billing less Postage which you might look at as the COS in a traditional agency for media cost. We work on 30-40% margin as our business model so in the example we bill a client $100.00 postage is $ 30.00 we pay the 6% on $70.00. I hope that answers your question.
Steve Orenstein
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