How do I calculate sales commission?

Commission = Sales Amount × (Commission Rate / 100). For a $50,000 sale with 5% commission: $50,000 × 0.05 = $2,500 commission.

What is a typical commission rate?

Commission rates vary by industry. Real estate: 5-6% (split between agents), car sales: 20-25% of gross profit, insurance: 5-15%, retail: 1-5%, software sales: 10-20%. High-value, complex sales typically earn higher rates.

How do tiered commission structures work?

Tiered commissions increase as you hit sales targets. Example: 3% on first $50k, 5% on $50k-$100k, 7% above $100k. This incentivizes higher sales performance with increasing rewards.

Is commission calculated before or after expenses?

It depends on the agreement. Most retail commissions are on gross sales. Business-to-business may use gross profit (after direct costs). Always clarify the commission base in your contract.

Commission Calculator

Calculate sales commission based on percentage rate. Perfect for salespeople, real estate agents, and commission-based earnings.

Calculate

Sales Amount ($)

Commission Rate (%)

Formula

Commission = Sales Amount × (Commission Rate / 100)

Example

sales Amount:50000

commission Rate:5

commission:2500

net Profit:47500

Frequently Asked Questions

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