Some top-performing salespeople earn more than their managers. This compensation is most likely made up of:

Question

BlackTom AI · Accepted Answer

The question asks about the typical components of compensation for top-performing salespeople who may earn more than their managers.
Option 1: 'bonuses only' — This is too narrow. While bonuses can be a part of compensation, relying on bonuses alone ignores the steady base pay and potential commission structure that many sales roles use to reward ongoing performance.
Option 2: 'bonuses and dividends' — Dividends are payments to shareholders and are not a standard part of an individual salesperson's compensation package. This option misapplies a corporate finance concept to a sales compensation context.
Option 3: 'base salary, commissions, bonuses, and incentives' — This combination reflects a common compensation mix in sales: a fixed base salary for stability, commissions tied to sales performance, performance bonuses for achieving targets, and additional incentives (which could include recognition programs, contests, or non-cash rewards) to drive higher performance. It captures both guaranteed and performance-based elements.
Option 4: '100% commissions' — While some roles or startups may offer high variability with only commissions, top performers who earn more than managers typically still rely on a base salary to maintain financial stability and predictable earnings, along with commissions and incentives. A 100% commission structure is uncommon for most mature organizations and would not explain earnings consistently higher than managers across the board.
In summary, the most comprehensive and realistic description among the options is the multi-component package that blends base pay with performance-based components, whereas the other options either overemphasize a single element or mischaracterize standard compensation structures in sales roles.

Some top-performing salespeople earn more than their managers. This compensation is most likely made up of:

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