A tiered commission plan is typically divided into multiple levels or "tiers," each with its own commission rate. For example: - Sales up to $10,000: 5% commission - Sales between $10,001 and $20,000: 7% commission - Sales above $20,000: 10% commission
Employees earn a higher percentage as they move into higher sales brackets. This approach not only motivates employees but also aligns their interests with the company's goals.