The parts of a typical pay plan
| Term | What it means |
|---|---|
| Front-end gross | Profit on the vehicle itself (selling price minus the dealership's cost and pack), plus or minus the trade. |
| Back-end gross | Profit made in the F&I office from financing and products like service contracts and GAP. |
| Commission % | The percentage of gross you're paid. Some plans pay on front only; some include back-end. |
| Mini | A flat minimum commission paid when a deal has little or no gross. |
| Pack | An amount added to the vehicle's cost before your commission is calculated. It lowers your commissionable gross. |
| Volume bonus | Extra pay for hitting unit targets in a month, often tiered. |
| Spiff | A small cash bonus for selling a specific vehicle or product. |
| Split deal | A deal shared with another salesperson; units and commission are usually split in half. |
| Draw | An advance against future commission, usually paid on a schedule while you're new. |
| Chargeback | Commission taken back when a deal unwinds or a product is cancelled. |
| CSI bonus | Pay tied to customer satisfaction survey scores. |
A simple example
Say your plan pays 25% of front-end gross with a $150 mini. You sell three cars:
- Car A has $2,000 front gross: you earn $500.
- Car B has $400 front gross: 25% is $100, so you get the $150 mini.
- Car C is a split with another salesperson, $1,600 front gross: 25% is $400, split in half, so you earn $200 and half a unit.
Add a volume bonus if those units push you past a tier. (Example numbers are illustrative. Real percentages, minis and packs vary by store.)
How a draw works
A draw is not a salary you keep no matter what. It's typically an advance: if you're paid a draw and your commissions for the month come in higher, you receive the difference. If they come in lower, some plans carry the shortfall forward. Ask exactly how your store handles it.
Questions to ask before you accept
- What percentage of gross do I earn, and is it front-end only?
- What's the mini, and what's the pack on new and used cars?
- Is there a draw or salary while I'm new, and does a shortfall carry forward?
- How are split deals counted for units and commission?
- What are the volume bonus tiers?
- When do chargebacks happen?
- How are internet and phone leads assigned?
- Is there a demo vehicle or allowance?
The Green Pea Playbook includes the full list of 24 questions to ask about any pay plan.
Frequently asked questions
Do car salesmen get paid hourly?
Rarely. Most are paid commission, sometimes with a draw or small base while they're new. Some states have minimum wage rules that affect how commission-only plans are structured.
What is a mini in car sales?
A mini is a flat minimum commission paid on a deal with little or no gross profit, so the salesperson still gets something for selling the car.
What's a good commission percentage for a car salesman?
It varies by store, brand and market. Rather than comparing percentages alone, compare the whole plan: pack, mini, bonus tiers and what counts as commissionable gross.