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Auto Dealership Sales and Service Commissions Best Practices: Part III

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Author: Michael Stus, Managing Partner

The sales and service commissioning process should be an integral part of strategic operation of an automotive dealership. The most successful auto dealership groups and stores employ key best practices when it comes to paying commissions to their sales and service personnel. What are some of these key best practices when it comes to paying commissions to sales and service representatives? Here one such best practice in a multi-part series.

Balancing Dealership Commission Plan Autonomy with Structure

The best operating automotive dealership groups realize that a level of dealership autonomy in sales and service commission plans is a necessity to maximize performance and effectiveness; regional, brand, and individual dealership idiosyncrasies are best addressed by allowing variances within commission plans. These groups most effectively realize this autonomy by coupling it with structure in process and plans, and absolute rigidity around certain items such as plan acceptance. Dealership groups can allow for variances within commission plans by offering an array of standard commission components, rate, and guarantee/draw options from which dealerships can choose when constructing their plans. Processing rules and terms and conditions to be included in plans necessarily vary by region (e.g. California) but their inclusion and acceptance is mandatory. The well run dealership group knows that structure and controls is a necessity with these items despite allowing flexibility with other commission plan aspects.  

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