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Do you base your commission percentages off GROSS SALES or PROFIT ?


mizugori

When paying locations a commission, are you giving them x% of GROSS SALES, or x% of PROFIT?  

110 members have voted

  1. 1. When paying locations a commission, are you giving them x% of GROSS SALES, or x% of PROFIT?

    • GROSS
      74
    • PROFIT
      34


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  • 1 month later...
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I use net. As long as you do a good job. Pay commissions regularly. And keep a good relationship with the person in charge. You want need to worry about someone else taking the location.

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i STARTED  out giveing commission of off gross,but a long while back steve explained on a certain topic that is not he way to go.basicly you are paying the location commission on your expenses too.his explanation was longer and better but it is the way to go.I didnt waste time trying to figure out how much profit per vend on each item ,I take 25 % off the top and give the commision off that.I did lose a location once I switchd so it is best to start off that way.25 % isnt my total expenses ecspecially since the tax rate alone is 8.25 % but no one else does it this way and i know for a fact.i have seen commission slips for what its worth.so I figure I am ahead of most operators in my area in that sense even if 25% is low.

once another location questioned me about it and I explained it to her and she was fine with it so it depends on who you are dealing with I guess.in a restraunt 25% is usualy the minimum one can expect to pay on labor costs alone not includeing food costs etc so most restraunt owners should understand.I also say I will give you xx amount of commission OF PROFITS when trying to locate.

HOw much are you giving them monthly 1 dollar?

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GROSS GROSS GROSS!!!

 

I mean does it even make sense to make the commission on profit?:huh:

 

How are you going to explain the location owner what your cost of goods are? plus how much did you spend on gasoline? plus what your salary??

 

Lets say you say 20% gross and theres 25 USD that means the location owner gets 5 USD!!!!

 

If you say 30% on profit and there is 25 USD, how much will the location owner get? Lets say your candy vended was 5 USD , so that means that there is 20 USD to take the 30% commission from. THat means the location owner get 6 USD!!!!!

 

It ruins the whole point!!!!

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I use net. As long as you do a good job. Pay commissions regularly. And keep a good relationship with the person in charge. You want need to worry about someone else taking the location.

Sent from my iPhone using Tapatalk

Ya maybe in the land of OZ

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  • 2 weeks later...

Hey havending,

try not to dis on everyone that does thing differently

there are multiple ways to skin a cat...

Your right there are many ways to skin a cat. However if the previous poster thinks that clean regular serviced machines with great service will keep him from being booted or keep others out of the location then he is mistaken. That's just the facts of the business. I live in the real world sure I would hope not to loose locations but we all will. Looks at SV we all hate them sure. But they do have clean machines old sure but clean and on regular service with same product we all use and we kick them all the time.

Disclaimer to mods I realize that the post was off topic but I was trying to respond to the post directed at me to further show what I was talking about.

Hey havending,

try not to dis on everyone that does thing differently

there are multiple ways to skin a cat...

Your right there are many ways to skin a cat. However if the previous poster thinks that clean regular serviced machines with great service will keep him from being booted or keep others out of the location then he is mistaken. That's just the facts of the business. I live in the real world sure I would hope not to loose locations but we all will. Looks at SV we all hate them sure. But they do have clean machines old sure but clean and on regular service with same product we all use and we kick them all the time.

Disclaimer to mods I realize that the post was off topic but I was trying to respond to the post directed at me to further show what I was talking about.

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Did he not say have a relationship with the locations too

That relationship is what service lacks

Sure they do. There are locations that they have had for years thats a relationship. Even with a relationship to the location be it basic like SV or better like operators here you can still loose the location or have an operator move in. I have been doing this a long time I can asure you I'm correct here. You can have best machine , service , relationship etc and still loose the location or have a move in.

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Did he not say have a relationship with the locations too

That relationship is what service lacks

I will give a real life example we have a location that only does 20 or so a month it's a nice 5 way. The only reason we keep it is because I have had it so long. And are friends with the owner and we even service her grown sons buffet in Birmingham. The machine is filled, cleaned and serviced every month by me only. If I sent one of my guys there I would loose money because the locations does so little. I went in last month and there was a new rack next to mine. If we as experience operators allow new guys to think if they do XYZ it's smooth sailing then we are lying to the new guys comming here to seek advice.

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I think someone has the post vacation blues. Hav, you've been a bit cranky lately. You should take another cruise and chill. [emoji568]

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But having what he said does make a difference, no?

Anyways, your original post was a bit harsh and sarcastic, wasn't it?

Yes it can help and go along way but the operator still needs to be on notice that he can still loose the spot. The poster said that their would be nothing to worry about and that sends false security to a new operator. Wasn't trying to be harsh

I think someone has the post vacation blues. Hav, you've been a bit cranky lately. You should take another cruise and chill. [emoji568]

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The next two are booked lol

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  • 8 months later...

Yes it can help and go along way but the operator still needs to be on notice that he can still loose the spot. The poster said that their would be nothing to worry about and that sends false security to a new operator. Wasn't trying to be harsh

The next two are booked lol

We are hooked on cruising also. We have been on 26 and we are going again in Feb. I have to get away or I'm afraid of what I might do. lol

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  • 1 year later...

Just read thru 5 years of posts! Sheesh. I'm still confused. Ha ha.

I like the model of count the money on the spot. Immediately deduct a flat 25% for cost of goods and operating. Then pay your commission on the remaining. Seems quick, fair, and business smart.

Would this formula and any pay commission off pure gross apply to snack vending too?

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