A
fee paid to a salesman based on the purchase or sale amount of the
transaction. Commissions usually represent a percentage of the total amount, but sometimes may be just a fixed fee per sale. Many industries use commissions as
incentive for salesmen to turn over a higher volume of sales and to reduce the cost of paying poor performers - a bad salesman working solely on commission may not even make
a living wage.
Professions that generally work on commission include telemarketers, stock brokers, and car and boat salesmen.