The Fast Start Bonus is one of the most commonly used bonuses in many Compensation Plans. This bonus allows you to create bonuses for sales of products or SKU’s. Fast Start bonuses typically apply to a specific product on an initial order or enrollment. These bonuses can be created as specific amounts or as a percentage of CV (commissionable value) and can be configured to only apply to customers or to distributors, or both. For example, one client may want to offer 20% of CV while another may not want to tie anything to CV and instead offer a specific dollar amount.
We also have the flexibility to include this in capping when it comes to the binary system. For example, typically in a binary system, you’re going to sum all of your commissions for the period then determine and set aside a maximum threshold of what you want to pay out in that period. If you’ve set a 60% cap, which means 60% of the CV taken in for that week can be paid back through bonuses.
Typically, the only thing under the cap umbrella is the binary bonus and the matching bonus, but we do have the flag here that if you decided you wanted the fast start bonus to be under the cap, it can also be included under that cap, which means if you then went above your 60% for the week, it would go through and reduce every single paycheck and bonus by that amount that you’re overpaying. (Note: Capping is only available to Binary systems.)
Since fast start bonuses are really built as a method of motivation to sell the product, most companies are not going to want to cap those bonuses. Additionally, fast start bonuses can be applied to recruitment. However, as the industry has shifted more and more on product sales and away from recruitment, we see this far less frequently than we used to.