With Plan wizard, you can create a plan for a payee.
Yes, the entire plan of one payee can be copied to another payee by selecting the option "Model from other payees plan". This reduces a lot of typing work especially in cases where the plans are identical.
You can create many incentives for a single payee plan.
You can set different payout frequencies like monthly, quarterly, half yearly and yearly as you desire to incent a payee at different intervals.
Yes, you can incent the payee with commission for a particular payee transaction, customer and product by setting the option in the "Additional Crediting Instruction" tab of Set Credit Rule form of the Plan.
For an incentive you can create many credit rules for a payee.
Credits represent the actual records of performance achieved by a payee. Crediting process executes transaction data through credit rules to determine credit distributions and generates credit records for payees and organizations and/ or managers based on the credit rule settings. In general, any plan that bases credits on transaction data will use credit rules to generate credit records. For example, if a payee receives 100% of the sales amount for a transaction, the rule must be setup in the plan.
In the plan, you are allowed to set many criteria while creating credit rules. Basic Crediting Instruction does a basic selection on the payee or payee manager in addition to the credit amount. Additional Crediting Instruction filters transactions based on the criteria selected from the drop downs; for example, you can select territory, customer, product or transaction from the pull-down list. You may set the payout rate/amount as flat amount in-order to calculate the payout amount.
Expression Builder is another method to calculate commission in addition to Standard Payout Calculation and direct entry of payout amount. Using the displayed set of variables and operators, you can create more than one arithmetic and logical expressions. Click on Variables or Operators to view its sub options. The highlighted value in the right hand side box is selected when Paste button is clicked.
In expression builder, you can create one or more arithmetic or logical expressions using variables. These expressions can be setup as a criterion so as to calculate the payout for a payee.
In QCommission, there are three different ways to calculate the payout:
- Calculated Payout Amount already calculated and available: It uses the credit amount generated during the crediting process.
- Open calculation and expression builder: You may setup expressions using predefined variables to calculate the payout.
- Standard Payout Calculation: Calculates the payout amount by multiplying the credit amount generated during the crediting process against the commission rate obtained using the Rate Lookup for the selected plan period.
QCommission lets you to execute the plan for a single payee. In the Plan Statement, you can carry out a lot of exciting actions. Action button on the plan statement provides many features including Calculate Plan that calculates the payout for the particular plan.
Yes, if the commission amount is large, the payout amount will be adjusted against the cap amount set in the summary payout of the plan. Cap is the upper limit for earning commission.
QCommission provides different options to calculate Gross Profit while importing from QuickBooks. It calculates the Gross Profit based on the Costs from Item List/ Costs from Estimates / Costs from Purchase Order.
Batch maintenance enables you to create and schedule batches for the calculation process and import process.
There is no right commission rate for a sales rep; it has to be determined on a case by case basis. Typically commission rates have to be determined based on various factors. Some questions to be answered are:
- Should the commissions be based on Revenue or Gross Profit?
- What is the expected for the quota for the sales rep for the year?
- What is the targeted compensation for the sales rep if they met quota?
- Do I want to pay the commission as a flat rate or a tiered rate with attainment?
Based on these questions a commission rate can be determined and assigned to the rep.
The resolution is at the company’s discretion. Here are the options in that scenario:
Company calculates the contribution due in those periods and pays it. A) then it forgives that amount or B) it recovers against future commission payments or C) asks the sales rep for a check for the contribution amount
We recommend the following option using our software. Calculate the possible periodic contribution amount and established at as a Draw amount in our software. Then when the commissions fall behind it the software will pass the minimum contribution amount to payroll. It will maintain a balance of such amounts and automatically adjust future payments down by the payments made by the company on behalf of the rep.
The draw amount is taxable if it is provided through payroll. Example, if the saleperson is on a draw of $5,000. If in month 1, they earn $3,000 in commissions and you provide a draw of $2,000 to make the total amount equal to $5,000, then you will be calculating taxes on $5,000 worth of income. If in month 2, they earn $7,000 in commissions, then you would recover $2,000 for the draw you already provided leaving them $5,000 in income which is taxable. Generally the tax effect should wash out as you recover the draw.
If the draw is not provides as part of payroll and given as a separate check and treated distinctly as a loan, then it is not taxable. You may have to charge interest depending on the amount and term of the loan. There are imputed interest rules if the loan is over a certain amount and term. If the loan is forgiven, it will become income to the employee and will then become taxable. Different rules apply for owners of the firm. Your accountant may need to clarify further.