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Had me hooked right up to this point: “When we get the check, we pay a commission to this representative. Assume the commission is $500.” I’ve never seen a sof
by jaynate 11mo ago
Had me hooked right up to this point: “When we get the check, we pay a commission to this representative. Assume the commission is $500.”
I’ve never seen a software company pay 50% commissions on a software sale. I know it’s and example but the percentages are wrong even for the perpetually licensed days. Should be closer to 8-15%.
Totally sales and marketing spend could indeed be higher in this model because autodesk moved to direct positioning with end buyers rather than distributors.
- jdswain 11mo agoCommissions were different back then. I worked part time selling computers around 1990 and a little earlier, margin on computers was moving down, but was as high as 50%, I recall it moving down to 30% and stabilising there for a while. I don't remember software margins, but it could have been about the same. I used to get 50% of the margin as commission.
- WillAdams 11mo agoA further consideration here is that this wasn't just commission, but also a payment towards providing support to the customer.
- kragen 11mo agoI'm pretty sure this is a roughly accurate breakdown of AutoCAD's cost structure 34 years ago. How long have you been in the business, and what was the highest-sticker-price software you were selling?
- kragen 11mo agoI am amused to see no response to this comment in two days.