A commission-only sales rep is paid entirely from the sales they make, with no base salary. It can work for short sales cycles, high commissions and reps who already have a network that buys what you sell. For most B2B companies with longer sales cycles it attracts the wrong people: the strongest reps want a base salary plus uncapped commission, because they can earn that elsewhere. If you’re weighing commission-only to save cost, a smaller base with a strong commission plan usually gets you a better hire.
When does commission-only work?
- Short sales cycles. The rep can earn within weeks, not months.
- High commission per deal. Each sale pays enough to make the risk worthwhile.
- Proven demand. The product already sells and the rep isn’t creating a market from scratch.
- Independent agents. Experienced agents who sell several complementary lines to the same buyers, and who choose to work this way.
Why do most experienced B2B reps avoid it?
Experienced B2B salespeople who hit quota are in demand and can choose roles with a base salary and good commission. A commission-only offer asks them to take on all the risk of a long sales cycle, an unknown product and a new territory. The people who accept are often between jobs or unproven, which raises the risk for you too.
What legal points should you check?
Rules differ by province and state, so check them where your rep will work. In general:
- Minimum wage. Employees on commission usually must still earn at least minimum wage for hours worked. Commission-only arrangements often only work for genuinely independent contractors.
- Employee or contractor. Calling someone a contractor doesn’t make them one. How much control you have over their work decides it.
- A written plan. Put the commission rate, when it’s earned, when it’s paid and what happens to deals that close after the person leaves in writing.
Take advice from an employment lawyer or accountant before you offer a commission-only role.
What are the alternatives?
- Base plus uncapped commission. The standard for B2B sales. Typical plans split on-target earnings between base and variable, with more variable for new-business roles.
- A lower base with accelerators. Reward performance above quota with a higher commission rate.
- A recoverable draw. An advance against future commission during ramp-up.
- Independent sales agents for markets you can’t yet justify a full-time hire in.
How do you hire a strong rep on a tight budget?
Hire for the sale you have. A rep who has sold a similar product to the same buyer ramps faster and earns their pay sooner. Be clear about the quota and the on-target earnings in the job description, and screen candidates on their record before you interview. Our guide on making your first sales hire covers what to prioritize when budget is tight.
How Sales Talent Group helps
We recruit full-time salespeople and sales leaders on base plus commission plans for B2B companies across Canada and the United States. We help you set a pay plan that attracts proven reps and check every candidate’s record against your quota before you meet them. Every hire is guaranteed to reach their first-year quota, and you only pay when we make a placement.
See how we recruit or tell us about the role.
Questions about commission-only sales roles
Is it legal to pay a sales rep commission only?
It depends on where the rep works and whether they are an employee or an independent contractor. Employees usually must earn at least minimum wage. Check local rules and take professional advice before offering it.
What commission rate do commission-only reps expect?
Much higher than reps with a base salary, because they carry all the risk. The rate depends on the deal size, margin and sales cycle in your industry.
Do you recruit commission-only sales reps?
Our focus is full-time salespeople and sales leaders, typically on base salary plus commission, because that is what attracts proven B2B performers. If you’re weighing a commission-only role, we can help you decide whether a base-plus-commission plan would get you a stronger hire.
