How much to pay an agent

[Broadcaster]

I have been asked by a friend to post this.

He has a small business and is now thinking of engaging an agent to help expand. He is looking at self-employment for the agent but is unsure how s/he should be remunerated i.e. on a percentage basis or basic salary. The business will only require someone part-time - perhaps 8 - 10 hours per week with the aim of finding new clients. Initially, he planned on paying on the basis of a percentage for each client recruited rather than payment for hours worked as he wants to ensure the work results in actually gaining new clients.

Has anyone gone down this route? Any advice would be appreciated.

 

[Purple]

A percentage of sales generated is the best method. One client can be far more valuable than another so the agent should be paid based on value/quality, not quantity.

 

[Setanta12]

Question of employment v self-employment is very much to the fore here. Careful not to trip yourself up. This 'agent' should be in control of their own work and decide their own hours and method of producing results. Paid on a % as opposed to set rate, also helps here.

What I'm getting at, is where you believe you have a self-employed contractor working for you, when in fact - on balance - you have a part-time employee. Trouble starts when you've been paying this guy gross on production by him of invoices- but the Revenue come knocking for unpaid PAYE/PRSI.

 

[Broadcaster]

Thanks Purple and Setanta12 for your replies.

Yes, Setanta12, you are right - self-employed is the aim for my friend's business as he really cannot afford, nor want, an employee. the agent will have full control over the hours s/he works and the methods engaged in recruiting clients. From what I understand, the bottom line will be an increase in numbers in the end. Each client pays the same amount so the quantity is the aim.

Given that there will be very little overheads for the agent, is there a general percentage rate paid in these circumstances e.g. 35%, 45%?