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Drawback of Commission Based Sales

by happy2012
4 replies
i have been studying marketing for quite some time and been a bit curious about commission based selling especially regarding the internet marketing gurus. if a sales rep were to sell a product worth $1997 and receives 50 % commission and the commission is already paid out to the sales rep, what happens when the customer demands a money back 1 year later ( assuming that the money back guarantee lasts 1 year)?

would the sales rep have to pay his portion (50%) of the money to the company which then fulfills the money back guarantee?

and what happens if the sales rep has already left the company?

would the best solution for them be not to have a money back guarantee in the first place?

Thanks!
#based #commission #drawback #sales
  • Profile picture of the author braincandy7
    I wouldn't want to sell any product which has a 100% money back guarantee for 12 months unless i knew that company/product inside out and really trusted the company.

    Most companies don't offer money back for that length of time but would instead offer product support and replacement. The norm would be 20 or 60 days for a money back offer.

    Are you talking theoretically or about something specific you are dealing with right now?
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  • Profile picture of the author Adrian Int
    Typically, the affiliate is only "on the hook" for the first 60 days, max. If, after that point, the customer returns the product it's generally on the company to return the full value in exchange for the product's return.

    If you're looking at such a product and thinking about promoting it.... it's time to read the fine print, my friend.

    Cheers,
    -Adrian
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  • Profile picture of the author WebPen
    Yeah, most companies don't do anything more than 30-60 days.

    The problem with a 1 year long refund policy is that someone may use it for a month or 2, forget about it, find it 11 months later and say "I need a refund from X so I can buy Y"
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    • Profile picture of the author happy2012
      thanks for all the replies! i was just curious about the subject...
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