Month end and a long spreadsheet
Your showroom staff are paid commission on sales. The sales are made months before the furniture is delivered, and your rule is that commission is paid on delivery. At month end, the manager exports delivered orders, matches them to the sales person on the original order, subtracts anything cancelled or refunded, and works out the commission in Excel.
Every month there are questions. Two sales people helped the same customer. A sofa was changed to a cheaper fabric after the sale. An order was cancelled after commission was paid. A customer bought online after a showroom visit. The manager spends hours on it, and nobody is quite sure the figures are right.
Why commission is so contentious
- Sale and delivery are months apart, and many things change in between.
- Customers are often served by more than one person.
- Cancellations, changes and refunds are not linked to commission automatically.
- Online orders after a showroom visit are not credited.
- Sales staff cannot see their own commission as it builds.
What the spreadsheet costs
| Problem | Cost |
|---|---|
| Hours of manual work | Managers away from the showroom floor |
| Errors | Overpaid or underpaid commission |
| No visibility for staff | Distrust and disputes |
| Unclear rules | Different treatment for similar cases |
How we track commission properly
- Each order line records the sales person, or people and their share, at the point of sale.
- Your commission rules are written down and applied: rates by category or margin, when commission is earned (on order, on delivery or on payment), and how splits work.
- Changes to an order after the sale, such as a cheaper fabric or a removed item, adjust the commission automatically.
- Cancellations and refunds reverse commission, and if it was already paid, the adjustment appears on the next statement.
- Online orders from quotes or showroom visits are credited under the rule you set.
- Each sales person can see their pending and earned commission, order by order, at any time.
- At month end, a statement per person and a payroll file are produced for approval.
Month end afterwards
The manager opens the commission report. It shows each sales person's earned commission for orders delivered this month, with adjustments for two cancellations and one fabric change. Sales staff have already seen their figures during the month, so there are no surprises. The manager approves the report, and the payroll file goes to the bookkeeper. Nobody rebuilds the figures in a spreadsheet.
Rules you set
The system does not choose your commission scheme. It applies the rules you agree with your staff, and highlights cases the rules do not cover, so they can be decided consistently and added to the rules. Payroll and tax treatment of commission are for your payroll provider and advisers. The system produces the figures they need.
Clear rules help recruitment and retention too. When a new sales person can see how commission works and watch it build order by order, there are fewer arguments and less suspicion that the figures are being worked out in someone else's favour.
Awkward cases, decided once
Most commission disputes come from the same handful of situations. A customer upgrades from a two-seater to a corner sofa on a second visit, served by a different person. A delivery is split into two, months apart. A sale is made at a discount the manager approved to close the deal. A made-to-order piece is remade because of a maker's fault and delivered late. Each of these is written into the rules once, with a clear answer, so the second time it happens nobody has to argue about it.
When something genuinely new comes up, the system shows it to the manager as an exception rather than guessing. The manager's decision is recorded with a note, and if it should become a rule, it is added. Over time the list of exceptions gets shorter and the rules get clearer for everyone.
Signs your commission needs this
- Commission is worked out in a spreadsheet each month.
- Staff dispute their commission figures.
- Cancellations after payment are hard to recover.
- Online sales after showroom visits are not credited.
- Staff cannot see their commission until payday.