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Smiles and frowns: inside's up, outside's down: inside salespeople saw a small increase in their earnings last year, but outside salespeople saw a small decline.

Article Excerpt
THE LATEST SALES COMPENSATION survey from Metal Center News reveals some good news and some bad news for service center salespeople. The good: average earnings for inside sales increased a bit in 2006. The bad: outside sales earnings declined by about the same percentage.

In 2004, industry sales professionals saw a big pop in their earnings as commissions skyrocketed along with the price of steel and other metals. In 2005, management at many companies made adjustments in sales compensation formulas to account for the unusually high pricing, so salaries remained flat. Last year--perhaps due to some belt-tightening in anticipation of a slowing economy and moderating metals prices--it appears management once again held the line on outside sales salaries while rewarding inside sales for shouldering additional duties.

As usual, total earnings for sales professionals varied widely by region and company size. But according to the MCN survey data, average salary, commission and bonus for outside salespeople totaled $74,966 in 2006, down 2.3 percent from the previous year's $76,754. Calculated as the median (the point at which half the responses were higher and half lower), the "typical" take for an outside salesperson last year was about $70,000, down 2.8 percent from the previous year's $72,000.

The news is better for inside salespeople, whose total compensation--including salary, commission and bonus--averaged $58,681 in 2006, up about 2.1 percent from the previous year's $57,490. The new median, at $54,500, shows a 9.0 percent increase from the previous year's $50,000.

Most service center salespeople have benefited significantly from the escalation of steel, aluminum and copper prices in the past three years, which has boosted commissions and bonuses for those not on straight salary. Though steel swung up and down in 2006, and copper took a late-year tumble, pricing for all three metals remains well above traditional levels. Developing a compensation formula...

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