I'd Like to Remit a to Your Salary Survey

Salesmen Pay

Salesmen Pay Reponse

I'd like to remit a to your Salary Survey

PLEASE CONSIDER THIS SUBMITTED: ANONOMOUSLY.

Sector: Capitive Lessor

Working for a tech company, as the Leasing Manager in a captive scenario I

find am in the a middle of the road in you compensation survey. I am paid

a base salary of 45K, .0075 of volume on deals until I hit 50% of a 6MM

quota. Over 50%, I am bumped to .1025 on volume. I also recieve 33% of GP

on fee income from transactions. Volume Commissions paid out monthly, and

Fee commission paid out at the end of each quarter (the bonus incentive).

PS. Just got on your Email list, and the its terrific. Now I know what

everyone has been raving about.

Name With Held

More Salesman Pay Survey

We will compile all this information eventually into one report. If you send

in your information, we will not quote you, unless you specifically allow us,

and we will verify that with you so we do not make a mistake. Your name

and company will be held confidential.

#1 Lessor

I work for a leasing sub. of a large foreign bank.Mostly small ticket. Bases are in the

30's-40's depending on experience. We get .008 of volume with a kicker on spreads that exceed

650 over. Quotas are $6mm-10mm depending on territory.

Discounter/SuperBroker

From your survey it appears that we may be giving the shop away. We

have a very simple commission only program. As a small to mid ticket

lessor broker/discounter we pay 50% of the gross fee on the

transaction. Higher amounts up to 60% are paid to consistent

producers, We pay every Friday for deals that fund that week. We

provide complete office and back room processing and pay for all internal

costs such as D&B, CBR, rent, phone, overnight etc.. Salesman pay for

all external costs such as entertainment and travel. We share in all

promotional and trade show expenses. We will work with established,

proven producers for a few months should a draw be necessary and we are

always interested in finding new talent.

Len Sperl, Onyx Capital Corp, Pittsburgh Pa.

Here in Minneapolis at NFG our sales reps earn 50% of GP on all transactions. We provide office,

phone, internet, marketing and trade show reimbursement. We have a credit, documentation and

funding staff to handle most of the non-selling processes. In addition we do a draw on future

commissions if a rep is new. Our monthly bonus plan is $240 over $7500 (which is the reps 1/2)

and $600 over $10,000 . Quarterly bonus is $720 over $22,500 and $1800 over $30,000. If a rep

hits $100,000 annually then the company provides a $600 per month car reimbursement for the

entire next year. We feel we have an aggressive compensation package because we want all of our

people to succeed. We are nothing without our people who got us here. Oh yeah we also have a

condo in Vail available to all our staff and reps to use at no cost. We are currently attempting

to create a way to pass ownership to super stars as well, but have not finalized it as of yet.

Keep the info flowing.

Best Regards,

Willi Abbott

President

Northland Financial Group, Inc.

Direct (952) 746-5251

888-485-5834

Fax (952) 979-1590

When I had my own shop we employed a very simple formula.

Salespeople were given a draw against commissions. This was like a salary

but they had to earn in excess of that amount to receive commission income.

Draw was initially $30,000, paid in bi-monthly installments of $1,250.

Commission rate was 30% of the gross profit on a transaction. Gross profit

was the PV of the discounted stream plus advance rentals less the equipment

cost and less any referral fees or points we had to pay out. Salesman did

not receive a sharing on documentation fees and the fee was not charged for

booking fees, lien searches or asset inspections assessed or required by

funding sources. If we bought the deal for our own account, the "house"

simply established a required portfolio yield and the deal was discounted at

that yield rate to arrive at the gross profit.

All salespeople were W-2 employees. That meant we paid all taxes including

social security and unemployment tax. Salespeople received 100% health

insurance and dental. The company paid all expenses including 30 cents per

mile traveled. Air travel, trade shows, etc. had to be approved before the

amount was expended. We paid cell phone costs up to a certain percentage of

their monthly fee income - I believe it was 1% or 2%.

If we didn't discount the residual, as long as the sales person was

continually employed through the time the residual was collected, they

received their 30% sharing upon collection.

If a new deal came in direct from an existing lessee, the deal was directed

to the salesman that brought in that lessee initially.

The company helped with vendor development. Salespeople were not treated

like independent agents. For out of state sales people who worked from their

home, we provided all equipment and paid for the business phone, fax and 800

line.

Typical budgets (of gross profit / fee income) were in the $20,000 to

$30,000 monthly range.

Commissions were paid on the 15th of the following month.

So....

A sales rep received $1,250 as draw on January 15th and another $1,250 on

January 31st. (The first $8,333 of gross profit will go against the January

draw.) If the sales rep generated $22,000 of gross profit in January, the

commission would be $22,000 x 30% = $6,600. From there we subtract the

$2,500 advanced via the January draw leaving a $4,100 commission check due

February 15th. On February 15th the sales rep received 2 checks, their $1,250

February draw check and the $4,100 commission for January.

We believe that 30%, plus expenses plus benefits plus direct costs

(marketing, long distance, etc.) brings the comp cost into the mid 40%

range. That leaves about 50% to cover conventional overhead - credit

analyst, CBR's, D&B's, documentation person, etc.

Massachusetts broker

Lessor

$50K base

.25% of volume

Cell phone paid for.

I should be making $100,000-

I really enjoy your news letter.

#2 Base Salary $75,000 (not a draw)

10% of the gross profit

Buy rates ranged from 200-300 over T's.

Commissions were to be paid 30 days after the quarter was closed.

Both commissions paradigms were geared for volume to be in excess of $1MM

per month.

Discount/SuperBroker

#1 Base Salary $75,000 (draw)

Salary x2 = $150,000

Expenses $ 30,000

Total $180,000 / 12 = $15,000 Hurdle per month

50/50 split PV on all deals

Buy rates ranged from 300 to 500 over like T's

Commissions were paid monthly

Here we make no salary, 45% of the gross margin on $1.00 residual deals, and

55% of the GM on the deals that we retain the FMV or 10% residual. We make

100% of the doc fee over what our sources charge and a draw is available on

a case by case basis.

We pay our sales reps 50% of the GP after inspections, UCC's and routine

office costs. We also pay for marketing and promotion items, business

cards, brochures, handouts, mailings, etc, etc.

The reps responsibility is to bring in the business and that is it. I do not

require a monthly volume, but do ask that they stay in contact, preferably

in person, with any customer or vendor once a month at least. I price, doc,

close and fund the deals. All they do is make the contact.

Any deal originated or referred by that salesperson's vendor or customer is

theirs even if they haven't talked with them about the specific deal.

Average annual compensation is usually 50 to 65K, but the opportunity is

unlimited. We are presently looking for reps in northern New Jersey and

western NY and eastern PA.

888-583-0400

Bob Runyon,

Capital Agreements Corporation

Leasing Salesmen Pay Survey

Leasing News is conducting a survey of what equipment leasing salesmen are paid

today. We are asking for information from readers. Please be assured all

information will be kept confidential as to source. We will not quote you or

your company, unless you specifically give us permission.

You may help with this survey by sending an e-mail ( )

or going to our web site and using our contact form ( which does not require

identity: )

Here are responses from eight companies we have received to date, divided into Lessor and

Broker/Discount salesmen:

Lessor:

We pay 2% of equipment volume in compensation. Generally there is a base of $48K and the 2%

commish is paid for volume over $200K. They also earn 25% of the fee of any brokered deal they

bring in. The 25% split of broker income is independent of our funded equipment volume We pay

monthly though will probably shift to

quarterly.

As a sales rep, with 4 years experience I make a base salary of $48k with a chance to make

commission once I make more money for the company than it takes to keep my seat, i.e. $4000 per

month. It seemed to be online with the Advanta commission plan but unless you really generate

volume you cannot realize commission.

Our plan is pretty simple. Our sales reps working with vendors and lessees

are paid a commission of 3% of the equipment cost.

Around here, be it small ticket or big ticket, I believe all the lease

origination personnel have had a base salary and then a bonus once a certain

minimum volume was done on a monthly (for the small ticket group) or annual

(for the large ticket group) basis. Our most experienced and senior large

ticket salesperson makes well into the 6 figure range I've heard but they

consistently book volume in the tens of millions each year. I think all our

large ticket group that have been here two or more years each make over

$100,000 per year between base and bonus.

Our small ticket people have had the potential to make six figures but it

has always been heavily volume dependent.

There are several different bases, based on whether or not they hit their bogey for the

year or month. Bonus is only paid once minimum target volume is reached.

If someone is not hitting their target within a year around here they

usually let them go.

Discount/Broker

I pay my in-house sales people as follows: Base Salary of 30K per year.

this covers the first $5,000 in GP. I allocate 50% of any deal the generate

themselves and 10% of the GP on any house deal that I assign to them to help

them cover the first $5,000 in GP. On the second 5,000 in GP the sales rep

earns 25% and 40 % on any GP generated after that. A rep working for me can

justify their existence at about $800K per year in volume. They will make

$45-50K at $100K per month in volume and about $75K at $150K per month in

volume.

We get 35% of the first $10,000 per month in gross that we bring into the

company. We get 45% above $10,000 and 50% above $18,000 per month.

We split document fees over the amount required in the approval. It is

all commission, no guarantee.

We pay a reconciling draw against commissions ranging from $10,000.00 per

month to $2,000.00 per month. The rep makes commission of 25% of the gross

revenues generated. Once they become three months behind on their draw, the

draw is discontinued.

You may quote me.

Several years ago I became aware of a survey done by The Manifest Group where

they found that the average equipment leasing salesperson, with two year's

experience, earned an average of $25,000 per year. This was, I was told, a

national average, which by definition means that half the salespeople

nationally earned less than $25,000 per year, and half earned more than

$25,000 per year.

At my former company, we compensated salespeople with a 50% split of the

gross commission due on the leasing transaction. The salespeople generally

had use of our office space, and we paid for special promotions. In

addition, we provided an auto allowance of $300 per month, and a telephone

allowance of $150 per month. We found it necessary, in virtually all cases,

to provide the salespeople with a draw against future earned commissions. We

found that even our most experienced salespeople did not break-even on this

arrangement until they were employed with us at least three years.

The most generous compensation program I have first-hand knowledge of

provides the leasing salespeople with 65% of the gross transaction

commission. This company, a longtime, successful leasing broker, also

provides office space, use of telephone, and the payment of advertising

promotions.

In fairness to all leasing salespeople, their compensation potential depends

as much on their company's access to capital, and flexible financing plans,

as it does on their individual sales ability and work ethic. In our case, at

just the time our salespeople began to realize their individual potential,

their ability to grow their earnings was drastically curtailed by our loss of

bank funding.

My only advice to your inquirer is: carefully evaluate the company you

represent or will represent. Your ability to cultivate vendor and lessee

relationships depends to a great degree on your company's ability to deliver

on its credit program and funding promises. Unfortunately, in today's

economic and leasing environment, the only thing you can count on is uncertainty.

Steve Chriest