Assign salesperson to sales order to calculate commission

There are some typical sales commission structures to motivate reps, such as revenue commission, gross margin commission, or tiered commission structure. But one popular way that many retailers apply is per-order based commission.

This article explores how you can associate sales reps with a sales order to calculate their commission using a point of sale system.

What is a per-order based commission structure?

A per-order based commission structure is where a flat rate percentage or fixed amount is applied to each order closed — one time per transaction.

For example:

A sales rep sells item A for $200, and the commission fee is 10% fixed 1 per order. The customer purchases 2 of item A; the vendor will receive $20 in commissions.

Retailers can also use this structure to track the performance of sales representatives. This works best when you give your sales reps both commission and salary or either way. For example, if any salesperson has a higher number of orders than the previous month, they are improving their work results. They’ll receive more commission or higher salary.

benefits of pos reporting simple reports

If you’re managing a sales rep team that requires shift switching more than one time in a day, you would want to build a suitable commission structure that fits with your current operation flow.

Is a per-order based commission right for your business?

Sales commission per order is undoubtedly one of the most effective ways to pay sales reps for their efforts. Whether this model is right for you depends on your business type.

Flat-rate commissions per order are commonly found within the insurance, property, and retail industries especially.

If you sell a service or product that is in high demand, has a short sales cycle, and is comprehensible to your targeted market, a flat rate model is a great jumping-off point for you.

This type of commission method can motivate your sales reps team and drive your business to grow.

Product exchange helps build customer loyalty

To successfully build a per-order or per-item based sales commission, you need to have a system that can record all selling activities from all sales staff. Besides, you need to associate their names with corresponding orders for further check or calculation.

For example, sales reps at retail stores often use a POS system rather than using a sophisticated backend interface. That’s when you — as a store owner — have to think about how to record every single transaction that belongs to each salesperson right on a POS screen.

Magestore POS screen

2 ways to assign a salesperson to sales orders to calculate commission

Commission per order is a great way to pay for real results. By having a technical solution that can assign salespeople to a specific sales order, store owners can track and calculate sales commissions with ease.

However, many retailers feel stuck at this stage because designing a solution is hard.

We’re glad to show you 2 possible ideas that you can apply to your current or future POS system. Both ways can help you record the exact sales rep per order. But they work best in 2 different situations:

1. Switch user account on POS at the beginning of each shift

This solution idea is perfect for the sales team working by switching shifts. 

editing order on pos

For example:

Salesperson 1 can work in the morning, they need to switch their account on POS to begin their work shift. Then they can enter their PIN code or simply swipe the staff card to verify their credentials.

Then each time the store rings up an order during salesperson 1’s shift, the system will automatically assign the staff’s name to that sales order.

They can complete the order and the process continues with the next salesperson.

The POS workflow includes 5 steps:

switch staff account on pos
  • The manager will be the one who opens the session at the beginning of the day. 
  • The next staff doesn’t need to open any session but follows the same session that the sales manager has opened. 
  • Between each shift, sales reps will switch to their pre-created account, which will be associated with all orders during the shift.
  • Order info with the sales staff’s name will be recorded in the system.
  • The manager will be the one who closes the session at the end of the day.

2. Enter salesman’s PIN on POS during checkout

At some businesses, it’s not always one person handling the POS. Sometimes the store is quite busy and multiple sales reps can take charge of completing the orders during one shift. It’d be a bit inconvenient and takes time for staff to sign in and out every time. 

Quick user switching during checkout would solve this problem and let business owners track performance at the same time.

Two salespeople can checkout at the same time on the same POS device. After placing orders, each staff can enter their PIN or swipe the staff’s card to the device. Then the order has successfully been assigned to each salesperson. This process is very quick and easy for end-users, especially when they have to go around to consult the customers and go back to the counter for the checkout.

The POS workflow includes 4 simple steps:

enter salesman PIN
  • Staff starts an order on POS
  • Staff clicks to proceed with order
  • Staff enters or scan their PIN (by barcode) or card at checkout
  • Staff completes the sale

With a customizable POS solution, you can transfer this idea to the solution provider you chose. They will help you analyze the requirements and turn the raw idea into features.

What’ll happen with the recorded data

After assigning a salesperson to a sales order, the system will transfer all data into the employee management report system in the backend. A good solution will help you calculate the commission automatically based on your pre-settings.

Depending on your business policy, the way the system calculates can be varied. But make sure to choose an omnichannel (online-to-offline) solution to synchronize the data in real-time without extra manual work.

Conclusion

In-store product exchange can be upsell and cross-sell opportunities

Commission per order can be an excellent strategy to keep the business growing. By focusing on the real results from the sales team, you can design your own commission structure with the help of a POS system. Point of sale is where sales representatives work every day, you should make good use of it.

In case you’re looking for a POS solution to keep the sales reps’ assignment per order simple, talk to a retail expert from Magestore to get a free consultation. Together we can build a tailor-made solution for your retail business.