Tiered commission by revenue can be calculated based on All Revenue Earned or Amount Above Earned. You can set the base rate that the commission is paid on for the first tier and then add as many tiers as you like. This can be configured on each staff member's profile once compensation tracking is enabled.
- Amount Above Earned - This setting applies an incremental commission for each revenue threshold achieved. Commission will be calculated as revenue - tier threshold x tier %
- All Revenue Earned - This setting applies only one tier, the one which matches the overall revenue. Commission will be calculated as total revenue x tier %
We will now look at how the commission is calculated for both options.
Setup:
Pay Cycle - Weekly
Staff Member - Molly
Service Revenue - $520
Commission Tiers
Above $0 - $499.99 per pay cycle then pay 25% of the revenue earned
Above $500 - $2999.99 per pay cycle then pay 30% of the revenue earned
Above $3000 per pay cycle then pay 40% of the revenue earned
Tiered Commission by Revenue: Amount Above Earned
If Tiered Commission by Revenue: Amount Above Earned is selected, the total compensation for this staff member will be:
1st tier - 499.99 x 25% = $125
2nd tier - 20.01 x 30% = $6
$125 + $6 = $131
Tiered Commission by Revenue: All Revenue Earned
If Tiered Commission by Revenue: All Revenue Earned is selected, the total compensation for this staff member will be:
$520 x 30% = $156
Product commissions by tiers are calculated similarly, you will need to set the tiered rates as desired. Commission for membership, package, and gift card sales can only be set as straight commissions.
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Tiered Commission by Productivity