## Commission Calculator

 Commission Amount x Actual Revenue x
 Sales Price ₹ \$ £ Commission Extra Commission(Bonus) ₹ \$ £

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# Commission Calculator

Every one of us is interested in making extra money than just our base salaries. Also, it is a known fact that people earn more in successful businesses and commissions than through low paying fixed salaries. It is for this reason commissions are one of the lucrative fields for many people who want to make handsome money.

As you move ahead on this page, you will understand what sort of benefits commission-based transactions possess, what you should know before joining a commission based job and how to calculate the commission amount.

## What is commission?

Commission is an amount that a business owner offers to a salesperson, a seller or a commission agent for the product that he sells on the business’ behalf.

For example, a real estate company hires commission agents to get sales leads and make potential sales. For each sale, the agent will receive a certain amount out of the total amount of the sale.

## How is commission calculated?

Calculation of commission is based on the concept of percentages. If you are new to percentages, our online free percentage calculator tool will give you deeper insights.

The formula for commission amount is:

Commission = Sales price * Percentage of Commission offered /100

## Sample scenario to understand commission calculation:

Consider that a business owner asked you to sell his product of Rs.700 to customers on his behalf. In return for the sale, the business owner agrees to pay you 15% percent for every sale that you make.

Then, your commission amount will be: 700*15/100 = Rs.105

Here, you may get a doubt. What will be the revenue to the company in such a case?

It is nothing but your commission amount subtracted from the final cost at which the sale is made.

In this case, the revenue to the company is 700-105 = Rs.595.

## What makes commission jobs attractive?

• Commissions are attractive to many people who want to increase their income. Here are some reasons why people prefer working for commissions:
• Freedom
• Commission offer income proportional to one’s sales calibre. The higher the number of sales done, greater is the commission amount. It is all up to the salesperson to use his creativity and make sales and earn money.
• Unlike an employee of a company, he is not answerable to anyone nor his timings are fixed and no other workplace issues will bother him.
• A commission agent has the freedom to work under many companies and need not stick to one business or brand. This paves the way to earn more without any upper limits. Commission business is all about using freedom with creativity.
• No limits of earning
• Most companies are ready to offer a lucrative amount of commission percentage to agents in order to increase their sales. This provides a great scope for commission agent to earn as much as possible, which often is not earnable in salary based jobs.
• Are you looking for increasing your salary or earnings? Are you sure you are being paid on par with the market range? Looking for tips to grow your income? Check our online free salary calculator.
• More Family Time
• Agents working under commission have the freedom to decide their own timings. Many commission agents work at their comfort from home and make a good amount of money.
• Often, there are no hassles of leaves, commute, and other problems that are present in routine jobs.
• Good self-employment strategy
• Commission-based jobs are a better alternative for solving the unemployment issue. Such jobs give financial and emotional security for unemployed people. This is another way of using their potential and giving them a chance to earn and secure their lives.

## Why businesses prefer commission agents?

The main aim of any business is to make profits by making more sales. Consider that a business is established in a region and want to make sales across the country. Then instead of opening new units all over the country, recruiting commission agents from various corners and offering them attractive commission percentage will do wonders in increasing sales at a low-cost investment.

Besides, in many cases, commission agents tend to work hard and boost sales as much as possible because of the attractive commission amount they receive.

Most people who are taken as commission agents have good marketing skills and people convincing skills. Thus, this will be an advantage for the business in establishing their brand in many regions and increase their sales too.

Sales are contingent upon the attitude of the salesman; not on the attitude of the prospect. W. Clement Stone

## What are some examples of commission-based jobs?

• Sales representatives
• Brokers for real estates
• Insurance agents
• Medical representatives
• Sales engineers
• Financial service sales agents
• Stockbrokers
• Loan officers
• Literary agents
• Inside sales

## What you should know about commission-based jobs?

Commission-based jobs may sound lucrative, but there are certain points that you need to keep in mind before opting for a commission-based job:

• Check if the business for which you are being offered a commission is legal, registered and has the state license.
• Do you have any agreement for starting the job?
• Some businesses may make agreements for offering commission jobs. Read the full document before you sign it.
• Commission jobs are not permanent.
• You should know that commission-based jobs are purely temporary. The business may or may not continue your candidature if it is not satisfied with your performance or for no reason too. Never depend only on commission from a single source and save a maximum portion of your earnings.
• Are you being offered the right percentage?
• When given a commission offer from a business, check how much the competitor is offering and negotiate your percentage to earn more. This way you are being paid to the market rate and are not underpaid.

A satisfied customer is the best business strategy of all. – Michael LeBoeuf