How do I track my sales commissions?

By Venu Kunche
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How do I track my sales commissions?

For those who work in sales, one of the most important aspects of your job is your commissions. We’ve learned in a previous post that there are various types of commissions such as flat-rate or fixed. Because commissions are likely a part of many sales folk’s total compensation, it’s important to understand them and how they work.

Most sales reps have their own way of tracking their commissions to ensure that they are getting paid what they worked for–there’s nothing more frustrating than getting shortchanged on a paycheck because you didn’t understand your commissions. Today we look at three of the most common ways that salespeople track their commissions and when to use which method.

Should I track my sales commissions manually?

Calculating commissions manually (like on a post-it or in your head) seems like the easiest way to track your commissions, but it only works for specific cases. The best time to calculate a sales commission manually is when it is a super simple commission plan and very few deals. For example, if you have a commission plan that earns you a 10% commission on every sale, you can probably do some quick mental math.

While tracking commissions manually is great for simple compensation plans, it can get confusing when you start adding variables like accelerators or dozens of deals. It can become time-consuming and it’s also easy to make mistakes. Tracking sales commissions manually may be right for you if you are an individual with very simple compensation plans and very few deals.

Pros:

  • No tools needed
  • Super quick for simple compensation plans

Cons:

  • Works poorly for more complex compensation plans
  • Easy to make mistakes
  • Time-consuming
  • No long term record of deals and payouts
  • Doesn’t scale with team

Should I track my sales commissions using spreadsheets like Excel?

The most common method of tracking your sales commissions is through spreadsheets like Excel or Google Sheets. This works great when compensation plans get more complex and you can’t do the mental math as quickly. We find it best for slightly complex plans with many deals. Although most reps enjoy the flexibility of Excel, they are also well aware of its shortcomings. It can get frustrating tracking down a mistake you make in the logic when creating a tracking sheet. Not only is it mistake-prone, but it is also time-consuming. Not to mention, that it is difficult to scale to larger organizations and collaborate with team members. If you are a rep in a small team with compensation plans that are not very complex, spreadsheets like Excel might be right for you.

Pros:

  • Flexible
  • Works well for very small teams
  • Can handle more deals

Cons:

  • Works poorly for more complex compensation plans
  • Easy to make mistakes
  • Time consuming
  • Doesn’t scale with team
  • Still manually entering deals

Should I track my sales commissions using QuotaPath?

And of course, there is QuotaPath! We provide a modern, automated solution that takes the burden of manual spreadsheets and mental math out of the equation. Personalized earnings and attainment dashboards make it easy to understand how your deals contribute to personal and company goals, which is a win for both reps and the company. QuotaPath ensures that everyone is aligned on how your commissions are tracked.

QuotaPath is right for you whether you’re an individual rep tracking your individual commissions or you are sales manager trying to motivate your sales teams.

sales-commissions

Pros:

  • Free for reps to use
  • Visual representation of your progress
  • Motivates you to achieve your quota and reach your goals
  • Great for compensation plans of all complexities
  • Scalable across all sales teams
  • Easily share plans out and collaborate with team

Cons:

  • Might not be useful for people with really simple commission plans

While those three methods are the most common when it comes to tracking commissions, we understand that sales folks might use other unique methods or software to help shine light on their comp. The great thing about QuotaPath is that it’s free to use and only takes a few minutes to get up and running. If you want to see how QuotaPath can help you track your commissions, sign up for free.

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