draw versus comission

[nitajaye]

I could not find if anything about this subject has been posted before so here goes.

I am looking for a new job and saw an advertisement for a sales position and it talked about draw versus comission. I sort of did some research, but quickly became confused (doesn't take much :0 ) anyway I was wondering if some of you savy people out there could enlighten me as to just what the phrase means and how you feel about the concept.

Thanks in advance

Anita

[Beccagold]

Usually it means that your income is based on commision which is usually a percentage of a sale that you make. Draw is when they give you a fixed amount each month to tide you over when you're not earning commision. That amount is then taken out of your future commisions.

Hope this helps!

[Daylily]

Yes. DH works on commission and he gets a draw.
Here's an example of how it works:
On June 1, receive draw of $1000 (for June)
On June 15, receive draw of $1000 (for June)
On July 1, receive draw of $1000 (for July)
On July 5, receive commissions $5000 for June less $2000 of draw = $3000
On July 15, receive draw of $1000 (for July)

Rinse and repeat.

[DebbieL]

A lot of sales people I know don't like to work on draws. You can actually wind up owing the company you work for if things are going slow. Imagine working 6 months and owing at the end of it.

[boomeyers]

My husband works on the same draw structure. One more thing to think about though, is that if he goes straight commission, the commission he receives is higher than if he is on draw.