Advantages and Disadvantages of fixed salary and commission plan for salespeople

Some job seekers have a love/hate relationship with commission-only jobs. And rightly so, since these types of jobs definitely have their advantages and disadvantages.

FlexJobs doesn’t post commission-only jobs, but for job seekers who are curious about the potential caveats they might face in looking for this line of work, here are the pros and cons of commission-only jobs.

 The Pros of Commission-Only Jobs

– Your schedule is your own

For the most part, commission-only gigs are flexible ones. That means that you can set your schedule as you need to in order to facilitate both professional and personal demands on your time. For job seekers looking for work-life balance, a commission-only job can be a great fit.

– You control your income.

Since you’re responsible for hitting your numbers monthly or quarterly, your success is literally in your own hands. So if you need to earn some extra income one month to pay for, say, your kid’s braces, you’ll know to work harder. And conversely, if you are an older worker looking for some supplementary income, you might not have to push yourself as much.

– You might have unlimited earnings potential

The cool thing about some commission-only jobs is that they might not have an earnings ceiling. This means that you can, theoretically, make as much as you want without a limit. And even if the company does have a commission earnings threshold of, say, $200,000, you might be able to exceed that amount in the form of other benefits, such as prizes, awards, bonuses, or the ability to pad next year’s earnings with the overage from what you’re earning this year.

– You know exactly how well you’re doing

When you have an office job and are having a bad day, week, or even month, you know that you’ll still see the same amount of money in your salaried paycheck. That’s not the case with a commission-only job, where your take-home amount might vary from month to month—and that can be a good thing. For workers who want to improve performance and have specific metrics to measure success, having a commission-only gig can show you how well you’re doing—and where you could show some improvement.

– You’ll probably work more independently

Commission-only jobs are, for the most part, a numbers game. If you’re hitting (or exceeding) your monthly quotas, your boss probably won’t be probing to see exactly how you’re spending your time. This can be very desirable for someone who wants to work without much interference or monitoring from a boss or manager.

The Cons of Commission-Only Jobs

– Your income can fluctuate greatly

Ah, the sweet sound of a new sale. There’s nothing like it, especially when you have a commission-only job. The only problem is that if you’re not selling, you’re, um, not making any moola. For someone looking for a steady income week to week, month to month, year to year, a commission-only job might not be a good fit. Since your sales can soar (or sink) depending on your overall success and the state of the market, you might become stressed out over being able to consistently earn an income to live on.

– You might be seen as high-risk

Let’s say that you want to refinance your home, or co-sign on your kid’s college loans. By banking standards, you might be seen as a higher risk if you have a commission-only job compared to somebody who has a steady income. In turn, you might wind up paying higher premiums and interest rates. If this is a concern for you, you might want to consider having a part-time or full-time job, and then using a commission-only job for supplemental income instead.

– The turnover rate for your work may be greater

The world of commission-only jobs is pretty black and white. You’re either hitting your numbers—or you’re not. So if you are having problems closing sales or keeping up, it will be immediately evident to both you and your employer. This means that you could potentially lose your job faster than if you had a job that wasn’t commission-only.

– You need to be self-disciplined

Some commission-only jobs pay their employees after every few weeks—or months. If you don’t set up daily or weekly goals for yourself, you might find that you work harder when you know that deadline (and your potential paycheck) are impending. That’s why those who choose commission-only jobs have to think of the bigger picture and work diligently, even on days when they aren’t about to get paid.

– You have to know how to work remotely

The majority of commission-only jobs are done remotely. If you’re the kind of person who thrives on the camaraderie felt by working with colleagues every day, it might be hard to transition to working independently most (if not all) of the time. But between the benefits of working remotely, and the ability to earn what you want, a commissions-only job could work out to be a great job to consider!

Even though FlexJobs doesn’t post commission-only jobs, we have plenty of options to choose from. We partner with more than 5,000 companies to offer positions in 50-plus fields — all of which have flexibility ranging from remote to part-time, and more.

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