straight commission plan definition

straight commission plan

Salesperson compensation method in which only a percentage of the sales volume, but no fixed salary, is paid. The amount received by a salesperson is a function of his or her performance (and not of actual time worked) reflected in sales volume. This method is used where the objective is to (1) generate maximum short-term sales revenue at the lowest overhead cost, or (2) to employ independent sales-representatives instead of permanent sales staff. See also straight salary plan.

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