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How to pay your salesmen?

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Author
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January 19, 2011 at 11:11 a.m.

yanni80

Hello Everyone, I own a roofing company outside of Chicago Illinois and I was wondering how other owners pay there salesmen salary/commissions. I'm having a hard time deciding what or how I should structure there pay. Also we do a lot of repair work and for example we will give the estimator a hour pay to put the estimate together and then usually the salesmen will make anywhere from 7-10% but what I'm finding out is the salesmen are making just as much as the company so there is obviously a problem...

June 29, 2022 at 12:19 a.m.

longjohnsgabby

Suppose, in Example Z, that a piece of work sold for $11.528.23 but that another piece of work was significantly different? As far as I know, there were no other jobs like this one that sold for as much money octodle. Even though they advertised for entirely different roles, are both of the salesmen at this job fair entitled to 10% of the commission on the tickets they sell?

March 19, 2011 at 12:45 p.m.

Mr. PealNSeal

Does anyone tie there % of sale commission to the current price of material?

So the going rate according to this thread is 7-10% of sale. What if shingles almost double in price again like they did in 2008?

We are not storm chasers. Used to pay 8%. Now according to the math I should offer 6%. I provide truck, gas, 401k, and approx. 25 leads per week during the busy season. A 30%/70% split for anything sold over our base prices (30% to salesman). 10% for door knocks (if they want to). 1 million a year is easy, 1.5 million should be sold, and sky's the limit after that. But I'm looking to attach the 6% to the current price of shingles. Does this seem fair?

March 19, 2011 at 7:39 a.m.

prsroof

patty cakes as a former estimator why shouldn't you reply?

February 27, 2011 at 8:31 p.m.

Patty Cakes

3900 and rising just like the gas prices. PC :blink:

February 25, 2011 at 8:29 a.m.

Patty Cakes

Geez 3800 now.PC

February 24, 2011 at 1:20 a.m.

Patty Cakes

Up to 3400 now. Scardycats.

February 23, 2011 at 4:48 p.m.

Patty Cakes

I haven't commented on this because it's just not my place. But 3300 people viewed it. They are all weenies, don't have the balls to speak up. I just grew mine. Whimps. PC

February 20, 2011 at 3:17 p.m.

RoofersClub.com

Hey what's up John. This is what I am thinking.....

% of sale commissions can be inaccurate unless all jobs are sold at the same profit margin.

Salesmen A - 1,000 dollar job that produces 250 dollars profit before overhead expenses.(25%) gross profit margin Salesmen B - 1,000 dollar job that produces 500 dollars profit before overhead expenses.(50%) gross profit Margin.

10% commissions = 100 dollars paid to salesmen on both 1,000 dollar jobs. Salesmen -A- made(100/250) or 40% of the gross profit on that job was paid to the salesmen. Salesmen -B- made (100/500) or 20% of the gross profit on that job was paid to the salesmen.

Salesmen -A- gave something for free, copper upgrade, so he could get the sale. Costing the company 250.00 of free work. Salesmen -B- sold the job without giving any service or upgrade away for free, so the company kept the 250.00 of profit.

But, both salesmen got paid 100 dollars. In this scenario it was unfair for salesmen B.

It is obvious in this scenario, but

What if in an example -Z- we say a job was sold for 11,528.23 project and another job completely different Job -X- sold for 14,269.31 Totally different projects, different materials, etc. Is 10% of the sales tickets on this job fair for both salesmen who sold these two entirely different jobs.?

There is no way to really tell unless you sell all jobs at a standard gross profit margin %. or pay your salesmen a percentage of gross profit like Sillabica does.

February 18, 2011 at 9:36 a.m.

SteveTheRoofer

Ottawa_Roofer, thanks for giving the only straightforward answer on here.

February 17, 2011 at 2:50 p.m.

sillabica

I offer commission percentage based on margin per sale. It works out ok, they can make an awful lot of money that way, but it has worked well so far.

February 12, 2011 at 8:07 p.m.

RoofersClub.com

10% commission is extrememly different on a job that is a 40% gross profit, or a job that was sold at 30% / 50 % etc.

Onarooftop

February 11, 2011 at 9:01 p.m.

charlotteroofers

You know I pay my Salesmen better than anyone in this area and it seems that they get kinda lazy and seem a bit unappreciative of the fact I'm giving them more. I have no idea what it is maybe it is the south but honestly it drives me nuts and im thinking of pulling theirs down a bit to see if they shake their asses a bit more!!

February 9, 2011 at 5:24 p.m.

ottawa_roofer

7%

January 30, 2011 at 7:50 p.m.

CIAK

Salesman are coin operated B) :) :) B) Deep Down In Florida Where The Sun Shines Damn Near Every Day

January 27, 2011 at 11:13 p.m.

Rambogolf

Hello everyone!

Without sales you don't have anything! Treat your sales reps like gold and watch them produce. A well trained sales rep is the single most important aspect in our business. I pay off the net profit (materials, labor, dump fees) anywhere from 20-40 percent. My top 3 reps also get a truck to drive, free golf, meals, etc... all 3 make over $100,000 a year. I hope this helps you and good luck!!!


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