Pricing & Salesbeginner
Commission
Definition
A performance-based payment equal to a percentage of a sale, paid to a salesperson, affiliate, or partner for generating revenue on the business's behalf.
Why it matters
Commission structures align incentives: sales reps earn more when they sell more. For founders, commission-based salespeople remove upfront fixed cost risk.
Example
An affiliate earns a 30% commission on every sale they generate. They drive £5,000 in sales one month and earn £1,500.
Related terms
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