With e-commerce sales booming, some Canadian businesses are reconsidering the commission structures that are in place at their retail locations.
According to the Retail Council of Canada (RCC), designing a fair compensation strategy can be challenging—especially when it comes to splitting store rewards among individual sales associates.
“This concept of attribution is a really gnarly one for retailers,” says RCC senior vice-president Michael LeBlanc. “There is no one-size-fits-all solution.” Options differ based on the type of retailer, format of the store, the role of sales associates and the company’s financial position.
Montreal-based clothing retailer Le Chateau is rethinking commissions due to the growth of “showrooming,” a practice where shoppers browse in-store but buy online. As such, the company is discussing allocating commissions from online sales to stores near the shopper’s home.
Industry observers add that luxury menswear retailers like Harry Rosen always pay commissions to employees—even when their regular customers shop online.
Trendex president Randy Harris says that adjusting compensation hasn’t yet been an issue in Canada because e-commerce still makes up a very small percentage of retail sales. However, he expects retailers will increasingly fine-tune their strategies as online sales continue to gain popularity.
If you’re a retailer with e-commerce capabilities, keep commission in mind as your operations move forward. Keep your staff happy, and your business will run as smoothly as possible.
