Configuring Organization Level Settings for Employee Commissions

Overview

You can use various settings at the Organization level to control the commissions employees earn for services they perform and sale items* they sell. 
(Sale item* is a common term for services, products, memberships, packages, free services, and gift cards.)


Read: Employee Commissions - An Overview

This article covers the following sections:

Navigation

To configure Organization level settings for employee commissions:

  1. Ensure you are at the Organization level. 
  2. Click Admin on the main menu.
    The Admin Dashboard appears. 
  3. Expand Organization
  4. Click Organizations.
  5. Click the Settings tab.
  6. Expand the Employee section.
  7. Select or specify your entries based on your requirement for employee commission-related settings listed in the following table
  8. Click Save.

 

Organization Level Commission Settings

Employee commission settings at the Organization level have a direct impact on employee earnings through commissions. Use the following table to refer to the settings and the impact they have on employee commissions. 

Field  Description
Adjust commission slabs per employee based on scheduled days

Controls whether you want to adjust commission slabs based on the number of scheduled days for which the employee comes to work. 
Example: Assume you have a pay period of 15 days. An employee is on planned vacation for 5 days during this period. This means the employee has worked for 10 days.  

Commission slabs (job or employee level) are configured based on the revenue they generate during this period.

In such a case, this setting controls whether you want to adjust commission slabs based on the number of scheduled days for which the employee does come to work. If the commission slab for Services is set to $1000 - $5000, award 2% as commission, and the employee generated a revenue of $800, the employee does not qualify for the commission based on the commission slab. But you want to consider that the employee generated the revenue in 10 days and want to award the employee commission accordingly. In this case, if you select this option, Zenoti calculates the commission proportionately and awards the commission. 

Employee Commission Income

Controls how Zenoti calculates commissions when commission slabs are defined at the job or employee level. 

Example: If you have defined commission slabs for product revenue as:

$1000 - $2000 - Award 2% commission 
$2001 - $3000 - Award 3% commission

$3001 - $4000 - Award 4% commission 

Assume an employee generates a product revenue of $ 3500. In this example, the commission the employee earns depends the setting selected at the Organization level.

If the setting Calculate using highest qualified commission level is set: Then, the employee gets the commission defined for the highest qualified commission level, that is 4% of 3500 = $140. 
If the setting Calculate by cumulative commission level is set: Then, the employee earns commission for each commission slab that the employee qualifies for. In this example, 2% of 2000 + 3% of 3000 + 4% of 3500. that is, 40 + 90 + 140 = $ 230.

Show commission setting details (in Employee Commission Details Report)

Displays details of settings you have enabled for employee commissions in the Employee Commission Details report, when you export it (to Excel, .CSV, or .PDF). 
Example: The exported report shows details such as:

  • Payroll start and end date 
  • Date on which payroll is generated 
  • Organization settings that are used to calculate payroll such as Commission slab setting (Calculate using highest qualified commission setting or Calculate using cumulative commission level) 
  • Free service revenue setting 
  • Product commission slab setting 
  • Product revenue 
  • Employee schedule details
  • Employee job details
  • Bonus and penalty details and 
  • Invoice details (closed invoices the employee was responsible for)
Do not consider invoices from other centers for payroll in base center

Applies to employees working on deputation (or on loan) to other centers and whether their commissions must be considered in the base center or in the other center. 
If this option is selected, it means that when an administrator runs the payroll for your center, Zenoti will not consider closed invoices of your employees on deputation to other centers in your center's payroll. 
Example: Assume Chris is a regular employee of Pike Street Center and is on deputation to Park Avenue Center. This setting is selected at the Organization level. Chris has delivered services and sold items at both the centers and is therefore eligible to earn commissions at both centers. 

When the administrator of Pike Street Center runs the payroll report, the payroll only considers the closed invoices that Chris was responsible for in Pike Street Center. 

Chris' earnings through commissions at the Park Avenue Street are processed in the payroll for Park Avenue Street Center. 

Allow rounding of commission adjustment in an invoice to maximum of 100%

Limits splitting commissions among two or more employees at the invoice level. At times, you may want to award one employee 200% commission (that is, double the amount of commission) while you may want to award the second employee only 50% or half the commission. 

If this setting is selected, Zenoti enforces rounding off the commission adjustment to a maximum of 100%. In such a case, you have to split the commission into percentages such as 90% - 10%, or 80% - 20%, or 50%-50%. 

Allow product sales commission based on

Controls how commissions are awarded to employees when they sell products. 
Note: The Employee Commission Details report shows the relevant details (in the exported reports) depending on the choice you make here, as long as the check box Show commission setting details (in Employee Commission Details Report) is selected. 

  • Product to service sales ratio: If this option is selected, Zenoti awards commissions to employees based on not just sale of products but also the number of services the employees perform.
    Zenoti calculates the product to service sales ratio as product revenue divided by the number of services performed in a given period. As per this setting, Zenoti awards a higher commission to an employee who is able to generate more product sales per service. For example, if Employee A sells 5 products and 5 services and Employee B sells 5 products and 2 services - than Employee B will earn a higher commission because the sale of products per service is higher (for Employee B).
    This setting applies when revenue slabs are used for product commissions. Organizations promoting both their services and products in equal measure can set up this model of product commissions.
  • Product sales per guest: If this option is selected, employees earn commissions based on product sales per guest. If you want to promote your products among more number of guests, you should enable this setting for your Organization.
    For example, if Employee A sells 10 products to one guest and Employee B sells 10 products to 5 guests, then Employee A earns a higher commission because the sale of products per guest is higher (for Employee A).
  • Product revenue: If this option is selected, employees earn commissions based on the product revenue they generate during a given pay period (irrespective of the number of guests they sold the products to). 
Commission type (all items) for item level definition

Controls whether you want to award commission on the Sale price before discount or on the Revenue earned for sale items such as services and gift cards. 

Example: If the sale price of an item is $100 and there is a discount of $20, and if the option Sale price before discount is selected, the employee earns a commission on $100. If the option Revenue is selected, the employee earns a commission on $80. 

Commission type for product and membership (Employee-Job definition)

Controls whether you want to award commission on the Sale price after discount or on the Revenue earned for products and memberships that employees sell when commissions are defined at the Employee or Job levels. 
Example: Say the sale price of a product is $100 and there is a discount of $20. If the option Sale price after discount is selected, the employee earns a commission on $100. If the option Revenue is selected, the employee earns a commission on $80. 

Free service commission

Controls how you want to give commissions on free service (revenue) to employees. In Zenoti, you define commissions on free service using revenue ranges or revenue slabs.

  • Use free service commission slabs: Consider this example. A Deep Tissue Massage costs $60. A 10% commission is set at the employee level. The massage is sold with a $10 discount so the final price a guest pays is $50. In this case, the service provider gets a commission of $5 (that is, 10% of $50). Zenoti considers the $10 discount as free service revenue. 
  • Include free service revenue in paid service revenue: Consider the same example. A Deep Tissue Massage costs $60. A 10% commission is set at the employee level. The massage is sold with a $10 discount so the final price a guest pays is $50. In this case, Zenoti considers the $10 (discount, that is the free service revenue) as part of the paid service revenue ($10 + $50). The employee therefore earns commission (10%) on $60, that is $6. 
  • Apply the highest paid service revenue commission on free services revenue: Consider this example. An employee is paid service commissions using slabs (5%, 10%, and 15% for three slabs). An employee falls in the highest slab (15%) when free service revenue generated is $5000. In this case, free service commission should be awarded using its own slabs but with this setting on, commission on free service revenue is paid at 15% (like services revenue).
Apply weighted price for service redeemed in a package for commission calculation

Controls whether package commission should be awarded on the price of the individual service (usually, higher price) versus price of the same service when bundled in a package (usually, a lower price that is called weighted price). 

Consider this example. A service costs $100 but the same service when bundled into a package of four sittings costs $300 (which means, each sitting in the package costs $75 (that is, 300/4)). Note that $75 in this case is the weighted price for the service.

Now, when a guest avails this service in a package, should the provider earn commission on $100 or $75? If you select this setting, the provider earns commission on $75. If this setting is cleared, the provider earns commission on $100. 

Allow commission on custom package  Controls whether you want to award commission for employees who sell custom packages. You can select Yes or No as per your requirement. 
Factor for commission on custom package

Performs the same function as Commission Adjustment on a service (field). Typically, you use this setting to promote custom package sales by awarding more commission to employees who sell custom packages. You could therefore, set this field to 200% - which means that the provider earns commission on double the custom package price. 

Award sales commission to employee with each payment for a series package

Select this checkbox to award commissions to employees each time the guest pays an instalment. This way, employees do not have to wait for a long duration (typically a few months) before they earn commission on the sale of the Series Package.
Note: If the guest purchases other items such as services, products, or memberships as part of the same invoice, then Zenoti processes the commission for these other items only when the respective invoices are closed. 

Deductions on Commissions

Specifies deductions on commissions. While you award commissions to employees for sale items they sell or services they perform, at times, you may also want to deduct a certain amount or a percentage on these commissions because of the costs you incur. 
High-end spas or salons typically award commissions in the range of 40-50 percent and for this model to work, you need to deduct your costs, else there is a high chance of your center incurring a loss. Applying deductions, you can offset these possible losses. 

  • Deduct internal costs: If this option is selected, you may deduct internal costs such as cost of advertising. 
  • Deduct new guest cost: If there was a cost involved in getting a new guest to your center, such as when a new guest comes to you as a result of a marketing event such as a campaign, you may want to deduct part of the cost of running the campaign from commissions employees earn on servicing or selling items to these new guests. 
  • Apply standard deduction: There could be some standard deductions that you want to apply in your organization that apply to all employees. For example, you may want to deduct the cost of running your center (rent you pay to run your center) proportionately from employee earnings. Zenoti deducts this amount from revenue employee generates before calculating commissions based on slabs. 

 

Read: Employee Commissions - An Overview

 

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