Commissions, Incentives, Bonuses – What’s the Difference?

businesswoman exhausted

Knowing the difference may save you thousands of dollars each year.

Pay sales COMMISSIONS for work you would not otherwise get.

  • Pay no commission for TPA work assigned to you.
  • Mitigation doesn’t require a sales effort. Imagine a customer ankle-deep in water saying, “Well, let me think about this. I think I want 3 bids.” NO SALES required.
  • Rebuild often requires no sales if you have a process to capture it along with the Mitigation.

Be honest when a sales effort is needed, and commission the effort only when it is.

INCENTIVES are used to induce or motivate better behavior.

  • Incentives are paid to motivate managers to higher job profits
  • Some are paid on gross revenue to encourage greater effort to capture more jobs

DON’T DO IT! Don’t pay twice what you should pay for only once. Incentives don’t elevate behavior. Don’t waste your money!

BONUS is an occasional reward for exemplary performance.

Bonus employees for hitting a home run with a customer, for coming in when not on call, for earning an above-average profit margin on a job, for really stepping up when needed.

Bonus any time and for any reason to say, “thank you for a job well done!”

Stop giving away your money without a good reason!

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