Defining Discount Compensation
The compensation based on discount is used by companies who want to provide an incentive for sales representatives to not heavily discount the price of products in order to make a sale. The company can set up a rate table, which provides a lower rate for transactions with a large discount percentage; thus, the company may be able to discourage their sales representatives from heavily discounting the price of products.
For this type of element, where the Element Type = Discount, only discount is used as a basis for calculating commission. If you are interested in using discount in combination with revenue, see Defining the Discount Option Field: page .
To define Discount compensation:
1. Open the Plan Elements window.
2. Name the plan element and provide a description.
3. For Active Periods, enter the start and end dates when this plan element can be assigned.
These dates must be within the dates of the compensation plan(s) the plan element is assigned to.
4. The Interval Type field is not applicable for discount compensation.
5. For Element Type, select Discount.
6. The Apply Txn (Transaction) field is not applicable for discount compensation.
Although you can select an interval, there will be no accumulation of quota.
7. In the Quota field, specify the target quota.
Enter the revenue goal for the set of revenue classes in the current plan element.
8. In the Payment Type field, select how the payment is calculated from the list of values.
- Applied Transaction Amount Percentage: A percentage of the amount of the transaction(s) is paid for each level of discount percentage achievement specified in the rate table.
- Fixed Amount: A fixed amount is paid for each level of discount percentage achievement specified in the rate table.
- Payment Amount Percentage: A percentage of the payment amount you specify in the Payment field is paid for each level of discount percentage achievement specified in the rate table.
9. In the Rate Table field, select a rate table from the list of values where the From/To rate tier is percentage or amount, and the commission is either percentage or amount based on the Payment Type field:
- Applied Transaction Amount Percentage: The commission rate is percentage.
- Fixed Amount: The commission rate is amount.
- Payment Amount Percentage: The commission rate is percentage.
10. Choose the Revenue Classes button to assign one or more revenue classes to this compensation plan element. (See Assigning Revenue Classes.)
See Discount Compensation Examples.
