Description - Salaries are for Chumps

Description

The title says it all. Deciding on pay plans requires considerations beyond the so-call “security” that salaries are supposed to deliver. Do they?

A salary in sales means the employer takes the risks so pays less. Commission means you take the risks so you can demand higher pay. Nobody gets rich as a salary wage slave. You can get rich on commission if your close ratio is high and you sell the right product.

Transcription

All right. Um, let’s talk today about the difference between working on a salary or working on commission. A lot of reps who grew up with a more socialist attitude think somehow getting paid a commission only you’re being exploited. Okay, that’s one way to look at it. Uh, on the other hand, if you take a salary job and you see your employer making all kinds of money and that is paying you a pittance, you think you’re being exploited.

So let’s look at this. One step by step. Salary jobs mean they own you. You’re taking this salary, they can tell you what to do, what hours to work, they can monitor your performance, you know, pretty much a slave, okay, a wage slave. With a commission job, you could tell them to jump it, you know, because you don’t like what you’re doing.

You’re only going to get paid when you get a sale. You control your own days, hours, you’d sell it your way, you know what I mean? You have freedom, you could take vacations. But then you’re responsible for making the deals happen so you can make a living. A lot of reps think salary jobs are like a guarantee.

It’s not a guarantee. If you don’t sell, they’re going to fire you. Here’s your guarantee. On commission, if you don’t sell, they might just wait, because you’re not costing them anything. Maybe you’re having a slump. Maybe you took some time off. Whatever. All they know is when a deal comes in and it passes, you know, it’s a valid deal, they’re going to pay you.

Okay? The other thing nowadays is you’re not going to work in some office somewhere. You’re going to work remote. That means you’re working primarily from home. This can work out good if you have a good work environment at home. But if you have a dog, three kids, and a wife, and everybody else in the house, it’s not going to happen.

On the other hand, for a couple hundred dollars a month, you can rent shared office space. All you need is a desk. You know what I mean? Or go work in a park with a cell phone. You do anything you want. The mental state that comes from working independently, remote, on a commission is that you become an entrepreneur.

The mental state of taking a salary is that you’re stifled all the time. You’re being held down. You’re like, like I say, you’re like a slave. You don’t have any dependents. All you want to do is watch the clock and go home. Okay? So, that’s how it works. So let’s look at the difference in, on the money. Let’s say, you know, that you make 1, 000 in a deal.

Okay. And you make a deal a week, you make 1, 000 a week, 52, 000 a year, right? And it takes you at least eight hours a day to do that. If you can make four deals in an eight hour period, because you actually know how to sell and you can generate enough leads, you’re making 4, 000 times 50 weeks over 200, 000 a year.

Let’s say you don’t want to wick more money. I mean, it’s great, but let’s say you’d rather have freedom and time to do things. If you can make four deals a day, you can make one deal in two hours. Now that’s interesting. You’re going to make the same amount of money, a thousand dollars a week, except you’re only going to do it in 10, uh, 10 hours a week instead of 40.

That’s called buying your life back. Now you have total freedom to do what you want. You can also work another job if you really want or have an application like a band, be an artist, travel, whatever you want to do. You have to be good at clothes. Now you have to know how to sell. Otherwise you’re going to have to stay on the salary.

Number one, you’re not going to take the risk. If you don’t know how to sell, you know, stay on the salary, let them take the risk and watch the years go by. Okay. So if you don’t know how to, uh, how to sell, you can work a couple hours, knock down a couple of deals, make enough money, take off, you know, have a life.

That’s the difference. So most people, they want to salvage. They’re obsessed with security. Here’s how much security you really have. You might be an athlete. Very rigorous, strong, go to the gym. Okay, what happens when you get hit by a truck at an intersection? Now you’re in a wheelchair for the rest of your life.

So how much security did you actually have? Jim Morrison, The Doors, famous band from the 60s, had a lyric in there that says, Nobody gets out of here alive. That’s exactly right. The biggest risk you have is a dream deferred. In other words, you have these dreams, but you don’t act on them. And then you die.

Talk to a guy who’s 80 years old. He’s going to talk about the chances he took. The risk and the rewards. Even if he didn’t win a law, he was still living. I mean, he wasn’t living in a cubicle for 50 years. So there is no security, and if you keep looking for it, you’re not going to find it. So the biggest obstacle to taking the commission’s job is, one, you don’t know how to close, so you don’t want to take the risk.

Or you think you’re going to get security somehow, so there is no, especially now when we’re looking around, they’re laying off everybody, Google’s laying off, there are no secure jobs. Everything’s up for grabs, okay? The faster you get on your own, the better, right? Do it earlier before you get a lot of obligations, okay?

So if you’re in your 20s, you got it made, just take the risk. Learn how to do that, and then you can, The other thing too is you can line up, uh, the employers will line up to hire you. If you’re willing to take a job on commission, you’re a hot commodity. If you want a job on a salary, then you’re at the end of a long line, okay?

You might send out hundreds of resumes and not get a job. Why? Because you’re asking for free money, okay? You’re asking for money before you earned it, which is all a salary really is. If you’re willing to take the job on commission, you can pick and choose, you can quit, you can do whatever you want, you can control your own destiny.

If you don’t think the product’s any good, they’re not supporting you. Then quit, take another job out of commission. If a better job comes along, quit. You’re a free agent. You are not obligated to anybody except to yourself. So I hope this, uh, helps get your head straight on straight and I’d be welcome your comments.

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