Free Commission Agreements - Manufacturing: Outside Sales Rep

Sample Manufacturing Outside Sales Rep Sales Commission Agreement Template
iManufacturing Outside Sales Rep Compensation Agreement
Revision Date: ii____________

This document describes the agreement betweeniii ________________________________ (“Company”) andiv ___________________________________ (“Sales Rep”) regarding terms related to compensation.
Company and Sales Rep enter into this agreement whereby Sales Rep provides sales services to the Company in return for compensation specified in this agreement.
Sales Rep is an independent contractor and can have sub sales reps under them.


This agreement covers the period starting from v_______________ and ends on ________________.

All commissions will be calculated and paid once every month, for the preceding month. Commissions will be calculated and paid out as part of the next payout cycle, following the month for which commissions are calculated.


Sales Rep gets direct credit for all sales sold by Sales Rep or sub sales reps in zip codes starting from 940 through zip codes with 944.

If product is shipped to customers in the above zip codes, but the actual sale happened in a different zip code, then Sales Rep gets 50% credit for the sale.

Sales Compensation:

Targeted sales compensation for the full year is vii________. The sales compensation is not capped.

viiiOther Compensation:

Sales Rep will be paid for all travel and lodging expenses related to sales activities. Auto travel will be reimbursed at the current federal reimbursement rate ix(Currently $0.56 cents per mile).
Sales Reps will be required to maintain a cell phone as part of conducting sales business. Sales Rep will be provided an allowance of x$50 per month for cell phone usage.

Client entertainment expenses will be reimbursed as following:
Meals: Reimbursable with receipts.
Special Events: Must be pre-approved. Reimbursable with receipts.
Expenses will be reimbursed within 30 days of being presented with the receipts and a completed expense reimbursement form.

Product Sales Commission
Sales Credits:
Sales Commission is paid to the Sales Rep based on the sale of the following products that the sales rep is involved in directly:
xiFlow Meter
Glucose Monitor

Sales Rep earns commissions only when an invoice to the customer is completely paid.
Sales Revenue minus Tax and Shipping charges are credited to the Sales Rep.

Sales credits are provided to the Sales Rep. Based on the product being sold the sales rep is paid different commission rates.
Commission Rates
Products Commission Rate
Flow Meter 15%
Blood Pressure Monitor 20%


Assuming Sales Rep completes the following sales in the first month
Invoice1 Flow Meter $60,000
Invoice2 Blood Pressure Monitor $30,000

Commissions will be calculated as following:
Invoice 1 $60,000 at 15% = $9.000
Invoice 2 $30,000 at 20% = $6,000
Total Commission: $15,000

There is no cap on any payouts to the Sales Rep
Termination of Agreement

On voluntary or involuntary termination of Sales Rep engagement with the Company, commissions will be paid on transactions dated prior to the termination date only. Any amounts owed to the Sales Rep will be according to regulations after withholding taxes and other dues.

Other Terms

1. Sales Rep agrees to follow all Federal and Local laws while engaged in providing services to the Company during the period of this agreement.
2. Sales Rep shall represent the products of the company positively and with the highest standards.
3. Sales Rep shall use the most ethical practices while engaging in any sales activity.
4. Sales Rep agrees to protect all confidential material including prospect data, sales data, and client information belonging to the Company and shall take all reasonable care in making sure that such confidential material is not disbursed to anyone outside the company.
5. This entire agreement shall be governed by the laws of the State of ___________.
Company Sales Rep

Company Payee
By _______________________ By_______________________
Name _______________________ Name_______________________
Title _______________________ Title_______________________
Date _______________________ Date_______________________

i Any part of this agreement can be changed or overridden based on your needs
ii This date will give us information as to when this agreement was written and distinguish it from similar other agreements.
iii Fill out the company name here
iv Fill out the payee's full name here
v Enter the start and end date for the sales commission plan effective period. Most companies use the calendar or fiscal year start and end date for these values.Some companies may not have an end date specified.
vi This provision can be entirely deleted or changed according to the companies needs
vii Targeted sales compensation for the full year
viii Optional. Maybe completely removed or altered according to the agreement of the company and the sales rep
ix Search for current IRS mileage rate
x You can put any amount or you may completely remove it or change based on your needs
xi Replace with appropriate Line Of Business; Line of Business indicates the mode of shipments. Alternatively, replace products with customers or types of business.