Would you work for free? We didn’t think so.
Unfortunately for many folks who work in commission-based or door-to- door (D2D) sales, it often feels that way—for a while anyway.
Ask yourself a simple question: If it took you weeks, months or even an entire quarter or season to be paid for your work, would you be inspired to reach your full potential as a salesperson day in and day out?
It turns out there’s a massive disconnect between when salespeople get paid and when they wish they got paid. At the same time, it represents an opportunity to impress and engage salespeople by paying them faster.
In July 2021, Everee concluded a survey of nearly 700 sales reps to learn more about how frequently they’re paid, how that squares with how often they wish they were compensated, and how commission structures, pay frequency and other factors influence where they decide to work.
Over half of respondents identified as working as door-to-door salespeople in solar, pest control, home services, automotive repair, insurance and consumer goods.
At a high level, we found that:
These figures paint quite the picture about the misaligned priorities between salespeople and the people who pay them.
For starters, one out of every four sales professionals relies exclusively on commissions to pay their bills. And at the same time, nearly half (41%) have to wait 30 days or more to get paid.
Taken together, it appears as though there’s a decent amount of sales professionals who are expected to “work for free” — or at least accept the reality that delayed payments come with the territory.
We all need money to pay our bills and live our lives. That being the case, it comes as no surprise that 31% of salespeople are planning to leave their jobs within the next two years, while nearly 1 in 10 of them are unsure about how long they’ll stick around.
Luckily, our research also identified an easy fix to these issues.
By paying your sales team within 24 hours of closing a deal, sales organizations and D2D companies can increase the chances that their teams work harder while also encouraging each salesperson to stay at the company longer.
With all this in mind, let’s take a look at some of the major findings from our research — and what you can do to take your sales team to the next level.
1. The majority of salespeople don’t receive commissions for at least two weeks
Our research revealed that just 15% of sales professionals are paid on a daily basis. Breaking the numbers down, salespeople say they are:
Add it all up, and 56% of salespeople don’t receive their commissions for at least two weeks, and 41% have to wait at least one month.
Hoping that this group, which consists of nearly one-half of sales professionals, has enough savings to get through the month can hurt retention.
2. 64% of salespeople want to be paid within one week
Our survey revealed that 64% of sales professionals would prefer being paid on at least a weekly cadence, with more than one-third of that group (24%) preferring to be paid every day.
Here is how all the pay frequency preferences worked out:
Compared to the answers in the previous question, organizations should consider paying their sales teams faster — and, at the very least, moving away from quarterly or end-of-season payments.
D2D salespeople want even faster pay
For salespeople who identified as door-to-door reps, 30% said they preferred to be paid every day. Only 2% preferred payment at the end of a quarter or season.
3. Pay frequency and commission structure are deciding factors when determining where to work
We asked salespeople to select all the factors that influence their decision to do sales for one company over another. Here’s how they responded:
Since we all work for money at least to some extent, it follows that sales professionals agree that pay frequency (50%) and commission structure (49%) are the most influential factors when it comes to deciding where to work.
That said, salespeople are motivated by nonmonetary incentives, too. For example, they also want to sell a great product (43%), work for a company that offers flexibility (40%), and be given career advancement opportunities (45%).
While implementing a generous commission structure and paying your sales team quickly can help you reduce turnover rates, you’ll also have to offer other benefits to keep your best salespeople engaged and on board.
4. Daily pay is valuable to sales professionals
Half of sales professionals agree that daily pay is either valuable or very valuable when it comes to figuring out where to work.
Beyond this, salespeople are also interested in bonus potential (62% say it’s valuable or very valuable), paid time off (70%), mentorship opportunities (60%), travel or equipment stipends (63%), and equity/ownership (61%).
These findings reinforce the takeaway from the previous section: While salespeople want to get paid well and in a timely manner, they’re also interested in other perks.
5. Daily pay encourages sales professionals to stick around longer
When asked on a scale of 1 to 10 how much an employer’s ability to pay commissions within 24 hours of closing a deal would impact their decision to work for them for the long term, 67% of respondents said it played a major factor selecting 7 or above.
Since the average cost of replacing an employee can creep up to 1.5x to 2x of their salary, this is a big deal.
In other words, pay your sales team every day, and you’ll reduce turnover and the associated expenses, bolstering your bottom line.
6. Daily pay encourages sales professionals to work harder to close a deal
In the same vein, when asked on a scale of 1 to 10 how much daily commission payouts would inspire salespeople to work harder to close qualified deals, 68% of respondents said 7 or above.
By embracing daily payouts, not only are you able to reduce turnover costs, you’re also able to increase productivity, grow pipeline and close more deals.
The easiest and faster way to pay your workers
By now, you’re probably thinking that paying your sales team daily makes a lot of sense. Not only does it resonate with your team, it also helps your business achieve the outcomes you’re aiming for — like an engaged team and more profitable operation.
That said, you might be wondering how you can actually do that. After all, your accounting or HR department has its own cadence, and you don’t want to dump a pile of new work on already-busy teammates.
Good news: By investing in purpose-built solutions designed to help you pay workers fast, you can expedite this process while ensuring your sales team gets paid every day — and without impacting your cash flow.
About the survey
Methodology: A sample of 693 salespeople who are paid
at least partially by commissions were surveyed in Q3 2021. Respondents were sourced via survey panel company Centiment, Everee’s database and social media.
About Everee
Everee is a payroll platform that lets companies pay 1099 and W2 workers fast and easy. Started in 2018 by financial leaders who were tired of outdated payroll software, Everee’s platform includes a mobile app to run payments from anywhere, automated tax filings, time clock, scheduling and more. Customers can leverage Everee’s credit network to fund faster pay cycles while maintaining their cash flow.