Commission Possible

Times have changed when it comes to sales in the promo industry. “When I came up, it was a much different beast. They handed you a phonebook and said, ‘Go get after it,’” says Rusty Pepper, head of new markets and partnerships at Taylor OnDemand, the print-on-demand fulfillment arm of Taylor Corp., which is the parent company to multiple print and promo entities, including Counselor Top 40 distributor Taylor Promotional Products (asi/333647).

Now, cold calling has given way to digital networking. Training and onboarding are far more robust, and promo industry sales reps are no longer exclusively commissioned independent contractors. The annual ASI Sales Compensation Survey has tracked many of these changes throughout the years.

It’s no different in this edition of the survey, which has uncovered marked shifts in rep pay structures and benefits offered. However, there’s one data point that remained unchanged from 2024: average compensation for reps. After six years of increases, the median compensation for reps and sales managers with their own book of business remained flat at $75,000. This signals the end of a growth period, as promo products sales rep compensation had increased by 36% since 2015 (compared to 9% from 2010 to 2015). This year’s survey also provides new findings about the employment status of reps and the products they’re responsible for selling. For salespeople, managers and owners eager for insights into the evolving landscape for promo reps, be sure to read on.

Compensation Structures: A Commission Comeback

There have been many notable shifts in the promo industry in the last decade, and the change in sales rep pay structures is one of the clearest. In 2011, two-thirds of reps in the industry worked under commission-based plans (including both straight commission and commission plus bonus). By 2023, that figure had fallen to 43%.

Meanwhile, only 22% of reps in 2011 were on salary-based plans (any plans that use salary as a base, including straight salary and salary plus commission). By 2023, that figure had more than doubled to include half of all reps.

However, in 2024, these trends experienced a notable reversal; commission-based plans increased by eight percentage points, while salary-based plans fell by seven percentage points. For the first time since 2017, commission-based plans are the predominant model in the industry. What accounts for the change? In a tough sales environment with inflationary pressure, thriving reps with an established book of business might be more inclined to seek a higher payout through commission. “I like to be able to make my own destiny,” says Scott Heavin, owner of Indianapolis-based The Promotion Lab, Powered by Boundless (asi/143717), a Counselor Top 40 distributor, who has always worked on straight commission. “Especially in an industry like this where you know your sales can run from tens of thousands of dollars to millions, it seems to me like the harder you work, the more you should be compensated for it.”

The employment status of the rep can also have a bearing, with full-time employees more likely to earn a salary than an independent contractor (IC). Two-thirds of industry reps (67%) are full-time employees, while a quarter are ICs. This is the first year ASI Research asked this question, so historical data is not available. But with slow industry sales, companies may be loath to hire full-time employees and take on more overhead compared to the alternative option of engaging with ICs who work on a results-based plan. Relatedly, as the labor market has shifted with companies now holding more of the cards, distributors can be more comfortable insisting on commission if they choose.

Still, there are some like Bryan Goltzman who are surprised by the reversal. The co-owner of Liquid Screen Design (asi/254663), a Counselor Best Place to Work, offers three options when hiring salespeople – salary plus commission plus bonus at two different levels, as well as straight commission. “We’ve never had someone choose the straight commission option,” he says. “Looking at the trend over a number of years, it’s clear that straight commission is declining, and I’d be very surprised if that increases over the next several years. Everything I’m hearing at shows and from other distributors is that people want the stability of some base salary.”

Winn Allen, a branding specialist with Adcentives West (asi/105710), has worked on straight commission since he was promoted to sales over a decade ago – a method he prefers due to its freedom and the unlimited earning potential. “I’ve always felt like I’ll bet on myself every day,” he says. However, he notes that the Salt Lake City-based distributor he works for now employs account managers who start with a salary and are given a book of business.

It’s not an uncommon practice these days. Salary in some form is an appealing option for new hires who can earn a steady income as they build up their client portfolio. It also speaks to the worldview of young millennials and Gen Zers who grew up during the Great Recession and pandemic and don’t have the same trust in financial institutions and the economic system.

“It’s a generational thing,” says Heavin, who has employed sales reps in the past but is currently a solo operator. “A lot of the newer people coming in the industry are younger and do need that guarantee, where people who have been in sales their entire life like me just understand that there will be ups and downs.”

Benefits: Cutting Back

Sales rep pay structures weren’t the only aspect of the compensation survey to show a significant change. A similar trend occurred with the benefits offered to reps. In 2023, top benefits such as PTO, health insurance and paid trips to trade shows were provided to more than two-thirds of reps, a dramatic increase from 2021 when only half of the reps received such benefits. However, in 2024, these benefits reverted to their previous levels and are now being offered to about half of the industry reps again.

The economy is certainly a major reason why. An August ResumeTemplates.com survey of 1,000 business leaders found that 51% of companies have cut benefits due to “economic pressures and a tight labor market.”

“The reduction of benefits like paid time off and insurance can primarily be attributed to cost-cutting strategies due to ongoing economic headwinds,” says Mike Szczesny, owner and vice president of EDCO Awards & Specialties (asi/185865). “With increasing operational expenditures and varying demand in some sectors, a lot of firms are focusing on short-term profitability as opposed to maintaining their business-class benefit packages.”

Jean Stefanazzi, VP of people & culture for Counselor Top 40 distributor Genumark (asi/204588), a Counselor Best Place to Work, agrees that “given the current market conditions, it’s no surprise organizations are looking and making cost-cutting measures. What is surprising are some of the benefits that saw a reduction in offerings – for example, PTO. Is the reduction a reflection of reps not taking vacation in the past few years or was this a conscious cutback? Given the last few years, it makes sense that many employees didn’t take their full time off, not only within sales, but I imagine we may see an increase in usage moving forward, if not already.”

The job market is having an effect as well. The Great Resignation led to a surge in hiring as companies desperately sought to fill positions, offering additional benefits/incentives to attract potential employees. By the end of 2024, the situation had reversed, with employers gaining the upper hand as the white-collar job market tightened and applications surged. Consequently, employers reduced the benefits offered, particularly for enticing new hires.

Not all benefits declined. Those directly tied to financial stability, such as 401(k) plans and annual bonuses, increased by over 10 percentage points. “The shift toward payment-by-result strategies and an emphasis on long-term financial well-being is apparent,” adds Szczesny, whose company is based in Fort Lauderdale, FL. “It indicates that firms are trying to achieve a tighter linkage between employee input and outcome and incentivizing greater expenditure of effort during times of uncertainty.”

Brittany Truszkowski, a Society for Human Resource Management certified executive with 16 years of C-suite experience with law firms, says “I’ve noticed a concerning trend lately – companies in all industries choosing quick financial wins over long-term employee support.” Reducing benefits to save on costs can be expensive in the long run.

“The impact on teams when benefits are cut is, typically, they feel like you don’t value them,” says Truszkowski, the COO of Grand Canyon Law Group. “And if somebody doesn’t feel valued, their attendance and performance will suffer greatly. Additionally I think their health suffers, because they don’t want to have to spend money to go to the doctor’s or go get their vision checked, you have more people who are out. You’re losing productivity and losing time and money for the firm or company.” She adds that Employee Assistance Programs really resonate with employees, and gym memberships are an easy way for little money to keep staff happy and healthy.

Sales Responsibilities: Print & Promo Convergence

For the first time in the Sales Compensation Survey produced by ASI Research, distributor sales reps were asked about their sales responsibilities. Unsurprisingly, nearly all salespeople are selling both hard goods and apparel. The growing trend of company stores is also evident, with nearly 7 out of 10 reps selling this popular digital offering.

Interestingly, nearly four out of five reps are also selling print items and printing services, highlighting the continued convergence of the print and promo industries. Instead of having separate print and promo reps, distributors now expect their salespeople to sell everything their company offers. That’s typical, according to Pepper of Taylor OnDemand. He explains that if a rep is assigned to a high-profile client and the distributor offers both print and promo, “that salesperson would be responsible for whatever the client’s needs are.”

However, since distributors typically act as brokers and don’t have in-house print capabilities, salespeople don’t need to know every detail about print. “You can have specialists come in at the micro level to educate clients if needed,” says Pepper. “At the macro level, a distributor would be armed with all the necessary information to speak intelligently about it.”