“I was recently offered a job at a big firm in Nairobi. However, the compensation is commission based, there is no monthly salary and what I get at the end of the month depends on how well I perform.
I am a bit hesitant to take the position because even though the commission structure is good, I am afraid of losing a regular monthly income.
What would you advice? Should I accept the job or should I insist on getting a base salary?”
Many organizations would choose to pay a base salary plus commission but some don’t. It all depends on the policy of the company.
Most of the time, we assume that commission only applies to people in the sales industry. This is not necessarily true since there are some other industries where commissions are offered as well.
Depending on whom you ask, you will get varying answers on which between commission and a salary is the better option.
For example, a sales person will tell you they would want a base salary just to get rid of the uncertainty. Whereas someone employed with a salary would say they want the opportunity to earn more which commissions provide.
So which is the better option between the two?
Money is a strong motivator; this is why employers use commission as a way to motivate their employees to perform better and in turn making the company a lot more money.
Earning on commission gives you some sort of freedom because you don’t feel like the employer is doing you a favor by paying you but instead you have truly earned whatever payment you get.
One of the biggest advantages you can get from being paid on commission is that you get to earn a lot more than what you would if the position had a set salary.
Sometimes the amount you earn can even triple what you would have gotten as a monthly stipend.
But on the flip side, this earning is not regular or guaranteed, so this month you could make over 100K and next month not even make half of that.
This is something you need to put into consideration when deciding whether to take that job or not.
A fixed salary is good if you are the kind of employee who prefers to have a predictable cash flow. You may not get rich quickly, but at least you can rest assured that you will have enough money to pay your bills at the end of the month.
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You could also end up getting a bonus depending on where you work which will also increase your earnings.
However, if you are the kind of employee who is willing to take risks and would rather see a large amount of money coming in even if it is not regularly, then taking a commission based job is okay.
You may not have the same assurance as those on a salary but with proper financial planning you won’t have to worry about the times when you don’t make a lot of money.
So which is the better option between the two? Well that depends on the kind of employee you are and what your goals are.
In your own opinion, is earning a commission better than a salary? Share your experience in the comment section below.