In the first two articles of this series, we looked at the various ways commissions can be calculated in such a way that "costs are covered," namely using a draw, a multiple of salary, or a threshold approach. In the second article, we looked at three different ways of scaling a commission rate relative to production: flat, retroactive, or progressive. We also discussed setting a fixed tier for production (e.g., $20,000) or a relative tier (75% of goal, where goal is individualized based on a person’s book of business). This article will focus on another very popular method for calculating commissions: the matrix.

My mathematical trick here is something that is derived from “The Rule of 78’s” which is typically used in other applications (such as mortgage interest payments), but it works just fine here as well. You can Google “The Rule of 78’s” or “Sum of the Digits Method” to get a deeper understanding. You might ask “how do we get the number 78”? 78 is the sum of …

In the last issue of 3PL Perspectives, we looked at the three basic methods for calculating a commission relative to a production threshold: draw, seat cost, and threshold. Now we will look at the ways you can calculate the commission itself. There are also three methods to consider: flat rate, retroactive rate, and progressive rate.

In this episode of TIA Delivers Podcasts, Beth Carroll, Managing Principal of Prosperio Group, provides insights into the four-part series she recently wrote for TIA's 3PL Perspectives Magazine. The four-part series, “The Economics of Commission” details the different approaches and methods used to figure sales commissions.

If you missed it, Beth gave an awesome presentation at Truckload 2020 about developing a cohesive compensation strategy for your company. If you have the time, we highly recommend you check out the videos below as you are certain to learn a thing or two.

I’ve been a sales compensation consultant for 22 years. During that time, I have experienced the dot.com boom and subsequent quick bust, September 11, the worst economic recession in a generation, and all manner of natural disasters that have impacted earnings under incentive compensation plans. There has been nothing like COVID-19; however, and many of the rules that we have all learned to play by simply will not work for this situation. We need to think about the psychology of pay first, but also consider the math, and for the first time in my history – we really also need to think about the broader societal and social implications of how we manage employee plans for the next 30, 60 or maybe even 90 days (I truly pray it is not longer than that).

In case you missed getting a copy at Truckload 2020, here is the link to the latest issue of Truckload Authority. Pages 32 and 33 house Beth Carroll’s most recent article about Compensation for Trucking Companies. Make sure to check it out, as well as consider signing up the TCA’s Truckload Live Distance Learning program where you can get instruction directly from Beth and other subject matter experts.

When it comes to sales compensation plans, people tend to "know what they know." And because of this myopia, they also don’t know what they don’t know—failing to recognize the different approaches to calculating sales commissions that may be available to them.

Prosperio Group is delighted to announce the opening of the survey collection period for the annual MeasureUp® Freight Brokerage Compensation Survey for 2019 results. This survey examines both pay practices and pay amounts for common job roles found at Freight Brokerages and is the only survey endorsed by the Transportation Intermediaries Association (TIA).