I've been freelancing websites on the side for a while now, and think I am ready to take on more work. My friend who is in sales wanted to help sell websites for me. What is a typical percentage for someone filling this role? He basically was going to serve as someone who knocks on doors (not literally), and serves as a project manager for these websites (following up with clients, organizing info etc).
I know this rate is subjective, but I don't even have a good starting point to work from...
I hate to bump but anyone have any ideas?
Thanks so much!!
I'm moving it to business and legal because I think you may have more answers there.
We do not bump threads here... if anything, you should contacts any of the staff
I was going to answer you the first time but then I thought it twice. I don't sell websites but build them so I don't know what's the typical commission. Still, if I was selling one, I wouldn't really care. My commission would be as much as a could get and the benefit that I want to get from it.
And my minimum? the figure that allows me to stay even.
That means that I would have to calculate all the expenses (domain, hosting, site building, advertisments to sell it...) and on top of that the cash I want to earn. With that information, I would try to see if I was out of the market or of there's a way to sell it that will guarantee my profit.
I would have thought a salary plus commission would be more appropriate. If you're not wanting to hire him a part or full time staff, then as a contractor I'd still expect him to get some kind of hourly wage. Also decide on what he gets commission for. Is he generating leads in the first place? If not, how are you doing that ATM, and how many leads should he be expecting to work with? Is he expected to handle the entire sales process and close sales? How will he handle technical questions from the prospects? What kind of salary is he expecting? TBH, if he's managing the project as well, that sounds more than just a sales job.
It would depend on how much is the project worth. You could set up a slot based commission for him. Something like:
Project Worth %Commission
$500 - $1000 5%
$1001 - $5000 10%
so on and so forth.
I give a straight up 10% to ANYONE who refers a job to me regardless of what the job is worth. Why give more if the value is higher? A percentage would give you more anyway, right?
Can we try to understand it in a simple way?
Calculate profit....... and give 50% profit to your friend..
If earning is a little higher for your friend then it would work as motivation/incentive.
You can see lots of big companies, they are big because their employees are happy.
Acquiring new client is expensive, and when someone gives me a new client I usually reward them VERY well. It's hard to just put a percent on it, because each project has a different margin/profit but on a project with a 50% margin I will frequently give half of the first 90 days profit to whoever brought it in.
I wouldn't really think of it as 'percent commission'. Think of it as the 'cost of getting a new client'. How much would you pay to bring in a client worth 10k? 100k? How much is it worth to you? That is how much you should pay, because you want to encourage salespeople to perform well by paying them well.
If I could pay $2500 to get a client that will bring me 10k in profit, I will do that regardless of the percent. I'm happy if the sales person makes more.
The second part about the salesperson also being the project manager - watch out for that. Those skills are rarely found in the same person and it could get sticky. If they can do both, then they immediately become more valuable than you do, so they should get most of the profit
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