Sales Compensation Insight

Step 3 in the new ASC 606 Implementation guidance is to “Determine the transaction price.” While this may be simple for many companies, it is difficult for others, especially when their contracts contain elements that could change depending on other interactions between your company and your customer.

Let’s look at a quick review of revenue recognition under ASC 606 then learn more about specific tax implications.

Putting together a good remote sales team might seem like a challenge, but it is certainly manageable if you follow the steps below. Once you’ve established a process for hiring and managing your team, you'll find the benefits of having a good remote sales team makes the upfront investment well worth it.

While it’s true the sales field was inhabited largely by men for much of history, it’s about time we put to rest the males-and-sales stereotype. For instance, did you know that women on average have an 11 percent higher rate than men at closing sales deals?

OTE is defined as the sum of a sales rep’s base salary and her On-Target Commission (OTC). OTC is simply the sales commission a rep earns if she achieves her sales goals. OTE tells sales employees how much total compensation they can expect to earn in their job. There are three important things to consider when using this incentive compensation structure:

According to the 2012 Sales Performance and Technology Survey, less than half of the companies surveyed reported 95% accuracy (or better) in their commission payments. 

The new ASC 606 regulations introduced the concept of “performance obligations” within contracts that you need to identify and use as the triggers for recognizing your revenue.

As you get closer and closer to nailing down a concrete sales commission plan, there are a few technical details you'll want to nail out.

If you have worked in sales performance management for more than 10 minutes, you will be familiar with this question. Why do salespeople make more money?

ASC 606 has changed commission accounting. One of the biggest changes is how amortization estimates work. Based on the new principles that must be followed we put this guide together.

Loyal, long-term customers are usually more valuable and more profitable than new customers that may churn frequently. Yet, we pay much higher rates of sales commission for new business than we do for renewals. Why is that so?

Below you’ll find a quick summary and outline. Then you'll find step-by-step instructions to help you learn how to implement the new ASC 606 accounting guidelines.

ASC 606, the new revenue recognition standard, requires an explanation in order to fully understand. If that’s what you want, you’re in the right place.

Clearly, compensation matters to sales reps. And in sales, compensation is tightly linked to performance. So, anything you can do to keep your reps motivated and help them hit their quotas will make them more money, be more productive, and encourage them to stick around.

In my time selling Sales Performance Management software, I have experienced a lot of highs and a lot of wins. I have also taken my share of hard hits and endured some searing disappointments.