Sales Commission

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68Percy
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Sales Commission

Post by 68Percy »

I've got a buddy of mine with a small engine repair shop and has a good bit of foot traffic in and out of his store front area. I've made a lot of stuff for his shop and him personally from the waterjet and plasma tables. I've been debating about making signs and various art work to display and sell in his store front. Problem is that I don't know how much to offer him in sales commission for the hassle of pedaling products. Would 10% be too high? Figured I'd ask if anyone else has a similar situation.
Austin Lanier
Dirt Road Metal Works, LLC
"Too much of a business to be a hobby, too much of a hobby to be a business"
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little blue choo
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Re: Sales Commission

Post by little blue choo »

I have dealt with this before with several of my business and can tell you I have always asked 30% to sell someone else's products and when I ask someone to display my products I offer them 30%. I do negotiate smaller percentages on larger higher priced items but always 30% on small items. Hope this helps.
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srp
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Re: Sales Commission

Post by srp »

If you are going to provide products for his store front they normally will take 40%. Sales commissions for reps is 20%. Cost of doing business. You might have to raise your prices.
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68Percy
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Re: Sales Commission

Post by 68Percy »

Thanks for the good advise. I don't have a problem raising a prices because I just do cnc jobs on the side. I stay pretty busy with the day job so I don't want to swamp myself with orders. I just wanted to give my buddy the going rate for his efforts.
Austin Lanier
Dirt Road Metal Works, LLC
"Too much of a business to be a hobby, too much of a hobby to be a business"
wickedinhere
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Re: Sales Commission

Post by wickedinhere »

Is that 30-40 percent of the sale or profit? I had my stuff at a "market" and they took 20 percent of the sale and i can tell you after 20 percent commission there wasnt much left on the bone. To make any real money i would have had to double my prices then wouldn't have any sales due to high prices.
srp
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Re: Sales Commission

Post by srp »

Percentages are based on selling price. All things are negotiable. I don't pay to have my products in shops. I will put them in on consignment and pay the percentage when they are sold. My products retail for 15-25 dollars. There is alot of pressure on pricing these days and I expect in the near future(5yrs) to be selling these same products at trinket prices 7-15 dollars. Don't quit your day job and develop a unique product which you can make some money on. Remember that anyone can make these products the key is selling them without braking the bank. FWIW
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