The 2020 Mid-Year Economic Update_long

Why Sales Compensation Plans Fail

With the recent attention in this industry given to strategic pricing, distributors who change their pricing structures must consider developing new sales compensation plans that reward improved profits. Before attempting a change, consider all appropriate structures and take steps to avoid implementation pitfalls.

According to a recent study, U.S. companies are markedly more satisfied with their sales compensation programs today than they were two years ago." Having spent the last 10 years designing and implementing sales compensation programs for hundreds of firms, I found this intriguing.

Upon further reading, I discovered that "markedly more satisfied" meant that 59 percent of companies surveyed in 2006 were satisfied compared to 34 percent in 2004. In other ...

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