What is your approach to commission pay for sales reps in their first and second months? Should companies offer ramp-up support: yes or no? 1. Pay full commission, even if they did not meet their targets. 2. Pay a percentage, such as 80% of the commission, even if they haven't met their targets. 3. Do not pay any commission without performance. Thoughts on this?
Yes - and the length depends on the length of the sale cycle. If your sale cycle isn’t 1-2 months it should be longer. Be realistic I believe 2 is pretty standard as long as you have a plan with accelerators so it incentives reps more.
When I was at HubSpot I was paid my full for 3 months, and then it ramped down for a number of months until I was on my own. It was a huge motivator to produce and keep earning that check. That said, their capacity model and bank accounts were for now flush than most smaller companies, so they could do that. I think a month at full, 2 at 80% for the first quarter will give a rep support while also motivating them to earn when the training wheels come off.
I go with a ramp quota that's achievable to hit 100%, pay out their commission equivalent to if they were fully ramp, but I do not allow for accelerators until the ramp period is over.
Sara B. -- we just released a great report on ramping comp plan best practices here: https://www.quotapath.com/resource/q2-ramping-comp-plans-report/ Also a ramp calculator that could be helpful: https://www.quotapath.com/ramp-calculator-sales/