At first, sure enough, a commission-based business or job sounds way too good, like your income isn’t fixed or anything and you can earn as much as you can. But then there is another side, like what if you end up making less than what a typical business or job would pay, and not just that, there are other downsides as well. So, it is always good to make sure you know what a commission-based business means, what you’ll be going through, how much you’ll be making and all that. That’s the very reason why we are here with all the possible commission-based business advantages and disadvantages, you know, just to give you a perspective on things. Here we go then.
Commission Based Business Advantages
1. You Get Paid for Hustling
Sure enough, one if not the best and biggest aspect of working on commission when you are the one hustling is that in the end, you are paid according to how hard you work. So let’s say you really go at full pace and full strength at work, then without a single doubt, you’ll end up making quite a lot compared to when working at a job and doing the same work for a fixed salary. It might sound a bit cliche because everybody says it nowadays, but yes, if you’re willing to go out of your way, then the sky’s the limit!
2. Your Efforts, Your Rewards
You see, in contrast to occupations that pay you the same no matter how much effort you put in, roles that pay on a commission-only basis encourage active participation and the best by rewarding them, you know? To put it in the simplest words possible, well, if you’re a go-getter, you can bring home more than your co-worker. This way, a commission-based business is kinda the best place for those who are highly competitive and ambitious.
3. A Chance to Sharpen Your Sales Skills
Working on commission delivers the double pie, but what do we mean by that? Well, simply, you earn good money, and it also shapes you for this world with those skills. To mention a few, the skills you will acquire during the process include negotiation, communication, and building relationships.
4. Businesses Save Money (And You Can Too)
Like whatever, it is a win-win situation for the employer and employee in commission-based pay, and how’s that precisely? Well, just so you know, the one thing we will mention is that the employer will only pay the employees if the sales happen, right? So, there will not be any waste of money on poor performers, don’t you think? It is not just good for your business, but if you’re a working employee in such a business, you’ll know that the more you put in, the higher income you’ll take home.
5. Attracts the Best of the Best
Without a single doubt, commission-based schemes are the best bait for a killer team that knows it will earn it after taking a big risk. Sure enough, such jobs are like a magnet to people who are genuinely excited, self-motivated, and the ones who are ready to do whatever it takes and as a business owner, that’s what you look for.
6. It’s All About Growth
See, it shouldn’t be hard to understand that when employees know that they will make more money by selling more, they are naturally motivated to grow the business. In turn, this growth cycle ensures there will be more customers, more sales, and more success for everyone involved, simple as that.
Commission Based Business Disadvantages
1. First Of All, Yes, Your Paycheck Isn’t Always Guaranteed
To put it simply, if you’re working on a commission-based job, your paycheck will certainly vary depending on how many sales you make. Just to lay it in the simplest words possible, well, some months you might feel like you’ve struck gold, but in slow months it can feel like you are just barely making it, and that’s not a good thing at all.
2. It Can Be a Pressure Cooker
Sure, the need to meet the sales quota might be too much at times. Like, if you don’t close any deals, it’s not the closing of a deal that is the measure of your success, and that tension can definitely add up. Not just that though, like, on top of that, in an environment of sky-high competition where every salesperson is mad about a commission, it can become even more intense.
3. Risking Your Reputation
As you might already know at times, the pressure to make a sale can force someone to violate the standards of the profession or to sell a product that is not suitable in order to fill a quota. The result of this can be disastrous, as the customers can get upset and the reputation of the seller can come crumbling down, that’s for sure.
4. Teamwork Takes a Backseat
In commission-based jobs, team members may not work together as a group, and if you really think about it, it kinda makes sense because of the natural behaviour of a person. Like, if everyone’s main focus is on getting an individual sale, it is possible that they might not share leads or assist the other team members so readily, you know?
5. Employees Might Not Stick Around
Sure enough, let’s not be delusional: not everyone will be able, or the fittest, to be acclimatized to working in a commission environment, you know? Like, in this way, businesses can be severely affected by such circumstances. And how’s that? You see, turnover can be high, and the stress, income fluctuations, and the competitive nature of a commission-based job lead to an employee quitting because it is not easy for everyone to handle. Not just that though, for employers on the other hand, it can mean a constant cycle of recruitment and training thus creating a headache on top.
Conclusion
It would be nothing short of pure stupidity to jump into such a business model before you know what you’re getting yourself into. And our today’s post was just that, to give you an all-around perspective on things, and what’s so good or not so good with commission-based business.
