The True Cost of Free Commission Calculation

by | Apr 24, 2020

The word “free” appears in neon lights, on billboards, or in all caps on the page. When the budget breaks between recruiting costs, payroll, necessary software, paying your team what they deserve, and other overhead costs, “free” is the gold at the end of the rainbow. Or is it? “Free” isn’t as free as it sounds and when it comes to automating commission calculations, “free” can actually be the most expensive solution there is.

Commission automation and calculation software that’s free will be very limited in its features. Likely, it’ll be just as much work to set up, run, and report as with Excel.

Whether the free refers to an endless collection of Excel sheets to calculate commissions or the freemium version of software, hidden costs will be incurred. And pile up before you know it’s happening.

“Free” Excel Sheets

Let’s be frank: Excel is the most expensive way to calculate commissions and build reports. It’s also the most popular for some reason. Sure, there’s no credit card charge to opening an Excel doc. But consider that your administrator needs to format and formulate endless commission rules. Then each month, that same administrator or commission administration team spends even more time pulling numbers from hundreds of different sources to calculate a pay cycle. And that’s not even accounting for reports that need to be built and distributed.

A full-time administrator calculating commissions for a team of 50 sales people needs a full week every month determining variable compensation. They’ll spend up to an additional week generating reports for each individual payee as well as reports for managers and the executive team to review sales performance. 

Factor in the amount of time they’ll need to review upwards of 50 spreadsheets when a commission dispute or audit occurs and the administrator is spending an awful lot of time on a task that could easily be automated and not enough time on other tasks that need a human touch, like communicating with employees who have serious compensation questions. The cost is priceless resources that could be focused elsewhere in an organization.

The “Free”-mium Secret

We’re gonna share a little secret here: most freemium software models are intended to hook customers who will pay for service down the road. Commission automation and calculation software that’s free will be very limited in its features. Likely, it’ll be just as much work to set up, run, and report as with Excel. 

Generally, if it’s free, it means it’s not worth it. Functionality will be limited, customer service will be non-existent, and since it’s a free model, it’s not getting a lot of love from the company in the form of software updates. Without costly add-ons, the service may even be completely useless to a commission administrator already used to processing commissions through Excel.

Aim for Cost Effective

Remind yourself: if it sounds too good to be true, it is. Free is usually not free once you tally the resources required and read the fine print. 

On the other hand, cost effective is real and attainable when it comes to commission calculation automation. Core Commissions can instantly cut your commission administrator’s processing and reporting workload by 30% to 60%. 

Core will allow administrators to process and email individualized reports in minutes rather than weeks. They can spend more time developing and interpreting overall reports on sales team performance and other more important tasks. 

Meanwhile, if commission disputes or audits come up, it’s a simple click of a button to answer questions or concerns that may come up. It can even protect an organization from legal action without forcing an administrator or an entire payroll team to dig through months and months of Excel sheets.

Core Reporter is available for just $2 per payee and it will immediately allow a business of any size to get started with Core’s powerful commission software. Contact us for more info.

If you want to get rolling fast, check into our Quick Start program. You’ll get 10 hours of personalized setup, training, and additional support with our administrators at a huge discount. It’ll give you the opportunity to try the tools out for a small price before you decide to invest but we’re pretty sure you’ll see the value immediately.

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