Question

Name and describe the four sales compensation elements. What are the various compensation combinations, and how can they be used to achieve the company’s marketing objectives? 

Answer 1

The sales compensation plan is a process in which the marketing strategy is implemented. The sales compensation plan affects the growth of its specific incentive plans and takes a strategic approach on all sales forces. All reimbursement plans are written and documented in general. These plans are mainly allocated to the sales force.

Tools: There are mainly four type of compensation tools, i) Fixed Amount, ii) Variable Amount, iii) Expenditure, iv) Fringe Benefit.

Combination:

i) Business sales goal and strategy: Defines the sales strategy and goals to achieve the company's goals.

ii) Performance measurement: Used for performance measurement and benchmarks spelling.

iii) Payout formula calculation: The method of payment defines how the company pays them for revenue and straight payments in respect of their fee.

iv) Rules and regulation: This selling agreement sets out certain rules and regulations that can be used to settle and fix any dispute sales claims.

Factor:

a. External: Wage rates, conditions of the labor market, legal requirements, living costs and collective bargaining.
b. Internal: Work quality, employer ability to pay, and job requirements.