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Sales commissions are incentives paid to sales reps in relation to the sales made by each of them. This payment is in addition to the regular salary component paid to the sales team. Commissions boost the morale of sales reps and motivate them to work better.

However, not all organizations have a proper sales commission system in practice. It is important to track commission payments to regulate the process and make it effective.

In this blog, we will be discussing some ways to make the tracking process effective.

What is sales commission tracking?

Sales commission tracking is the process by which organizations monitor the recording of sales transactions and the corresponding commission calculations. Commissions are calculated at rates and intervals as discussed during onboarding.

It also takes into account the timely payment of commissions.

Ways to track sales commission

These are some ways you can track your sales rep’s commissions:

1. Manual tracking

This is the age-old technique of manually recording all data related to commissions. The calculations are also done manually. This is a slow process and is suitable only for small organizations where the volume of data is very less.

It takes away a lot of productive time and is also prone to errors.

2. Use of spreadsheets

This is an improvement over the manual process where data is entered in spreadsheets. Formulas for the calculation of commissions can be pre-set in rows and columns. This is better than the manual process as it reduces the time taken for calculations.

Still, there is no automation and the input of data takes a huge amount of time for a large organization.

3. Use of software

This is the use of automated tools for sales commission tracking. The software tracks data in real time and makes calculations a breeze.

Downloading data from spreadsheets is easier without manual intervention. It reduces inaccuracies in calculations and makes the tracking process transparent. There are a variety of tools available for sales commission tracking, so you should choose the one best suited for your enterprise.

For example, Xoxoday Compass is a very effective commission tracking tool that ensures timely payment consistently. It reduces the commission processing time by 95% thus enabling the sales team to focus on attaining business goals. The tool provides real-time information and actionable insights to make the process effective. It can also be easily integrated with a business’s everyday tools.

How to make the sales commission tracking process effective?

Here are some tips that could make your tracking process effective:

1. Standardize the process

A standardized process lays down policies that should be followed by all the team members. It eliminates any confusion in the steps to be taken or the documentation procedure.

Standardization also helps employees, who are new to the role, adapt easily. It streamlines the process and reduces the possibility of errors.

Maintain a logical flow of data

Presenting the data in a logical flow helps the sales team ascertain the steps in each activity. Software that automates the process helps with maintaining the flow.

Customize reports for each sales rep

Customized reports help sales reps reach out to their specific data. They need not browse through a huge amount of data, which would include other employees’ reports too.

Commission tracking tools filter the data for each employee, calculate the commission, and send out customized reports. They can be filtered based on sales teams, regions, etc. This saves a lot of time and makes the process highly effective.

Proper labeling of data

Labeling helps in the proper organization of data. Sales reps can easily understand the tracking process with labeling. Tools that assist in commission tracking give requisite information on calculations, etc.

Labeling also helps in the easy identification of data from the dashboard. It eliminates confusion and thus makes the process easy to adopt.

2. Automate the process

The sales commission tracking process should be automated to reap its benefits. Automation saves a lot of time and also reduces the chance of errors.

Huge calculations are made simpler with automated tools. By eliminating inconsistencies in the commission process, you create trust in your sales reps. This motivates them to contribute better to the organization.

Automated tools are flexible to include any changes in the commission calculation process. This flexibility make them functional and effective.

3. Simplify the process

A simplified process is easy to manage and use by all stakeholders. Simplification makes the process effective so that sales reps need not worry about their commissions.

Simplify the calculations

To simplify the process the calculations should be made simple. This is possible with the various software available. The software easily picks up data from spreadsheets and calculates the commissions for sales reps. It makes the process quick and error-free.

Real-time updates

The sales commission tracking process should be flexible for real-time updates. With integration to CRMs, this is easier.

There will be no delay in payments, even with the huge amount of data for calculations. It is also easy to monitor and track the process effectively.


Sales commission tracking is highly essential to keep the sales reps happy and engaged with your business. Use tracking software to simplify your tasks, and this will be a win-win for the sales staff and the business.

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Karishma Bhatnagar

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Karishma is a passionate blogger who comes with a deep understanding of SEO tactics. When she isn’t working, you’ll find her in the mountains, experiencing the fresh breeze & chirping sounds of birds.