To calculate commissions, you need to establish Commission Groups. These groups will help organize the types of commissions you offer and when they apply.
Important things to Consider
To properly use the Commissions Tracking feature in LOU, you must be intentional in your definitions. Take time to consider the following:
- Who is eligible to earn Commission?
- What types of transactions qualify for Commission?
- What SKUs can be sold to earn Commission?
- Do you want to offer a Percentage of the Invoice Total or a flat rate as Commission?
Go to Operations / Sales / Commission Groups
This is where you will define and manage your Commission Groups. Groups are essentially the particular Commission you’re paying. All the Groups you’ve created will appear here. You can Search Groups and filter for Active/Inactive/All at the top of the page.
Create Group
Create a Commission Group to define a Commission for LOU. This group is more than just the people who earn commission. When considering what to call it, best practice is to name the commission something that easily identifies the type of commission. For example, looking at the Commissions Groups above, we currently have two – New Spa Incentive and Service Upsells. After giving your Commission Group a name, the following items need to be defined:
REMEMBER! These parameters are for currently active data. If you make changes to data and deactivate items that are included in Commission Group setups, those deactivated data points will not be used by LOU to calculate Commissions.
Before deactivating Personnel, Departments, Document Types, Customer Types, or SKU Categories, make sure your commissions are up to date. Once deactivated, be sure to go to your Commission Groups and make necessary updates and changes there.
Personnel
What Personnel are eligible to earn this Commission?
To add Personnel, use the dropdown and click the Personnel. They will be added to the list. To add all Personnel, use the Select All button and this will add all active users to the list. The Clear All button will remove all listed Personnel.
Departments
What Departments are associated with this Commission?
You can add Departments by using the dropdown and clicking the Department to add to the list. You can add all Departments by clicking Select All or remove all listed Departments by clicking Clear All.
Document Types
What Document Types do you want associated with Commissions?
REMEMBER! These are Source Document (Estimates/Orders) Document Types which may differ from the Invoice Document Type. Commissions are calculated based on Invoices.
Customer Types
What Customer Types are associated with this Commission?
SKU Categories
Which SKU Categories contain the SKUs on which you can earn Commission?
REMEMBER! Commission is only calculated on the Invoice Subtotal (pre-tax) for SKUs from included Categories. LOU does not calculate Commission on the individual SKU level or by any other data point.
You may have Categories that contain a few SKUs that do not qualify for commission. There are two ways you can handle that situation:
- Create a Sub-Category for those non-commission SKUs.
- You can use the SKU Mass Update feature to quickly re-organize SKUs.
- Ex: All the spas we sell are in the SPAS category, but we are not offering commission on our Resale Spas. Within our SPAS category is a Category 2 called RESALE and those spas are already discounted since they are used product. When we create our Commission Group, we can include SPAS and not include the Category 2 of RESALE, thus excluding those SKUs from our Commission Group.
- For instances where you may only have one or two SKUs that shouldn’t qualify for commission in a Category, it may be easier to simply manually adjust the Commission Run. Check out Commission Runs for more information.
The buttons for Category 1-4 correspond to your SKU Categories and sub-categories. You can drill down to locate SKUs in all Category levels.
Commission Rates
This allows you to define the minimum and maximum Invoice Subtotals to qualify for Commission, as well as either the Commission Rate as a Percent or the Commission Amount as a flat Dollar Amount.
The Commission Rate can only be either a Percentage or Flat Amount. Toggling one automatically toggles the other off. You can add multiple Rates to the Group, allowing you to create Tiered Commissions based on Invoice Amounts.
IMPORTANT! When creating tiered commissions, take care to consider dollars and cents so that you don’t create gaps where no commission is earned.