what is meant by OTE - On target earnings in a salary structure?

Answer 1

OTE = on-target earnings

The typical pay structure for a salesperson is composed of a fairly low basic salary with an additional amount of commission. The package will usually be called OTE or on-target earnings, meaning that if a salesperson hits the targets that you've specified for them, they will be guaranteed that amount of money. A higher commission can be paid if the person performs beyond this target. Such incentives naturally help to instil a desire for sales.

Answer 2

OTE means On Target Earnings: if you meet your targets, you will get this much money. However, when a job ad states that you will have a salary of £55,000 OTE doesn’t mean that you will indeed earn £55K per year. A company will offer you a base salary and a bonus for your achievements. The base salary is what you will have going into your account on a monthly basis, and these often (depending on what the role is) would not exceed £20K-£22K (would usually be £12K-£18K) for a sales/field representative, £25-£30 for an area manager, and up to £45K for national level sales managers and executive management members. The company will then pay you a bonus (either at the end of the year or on a month-by-month basis) according to how much you’ve sold or achieved and whether or not you've met your targets. It is important that you find out what your base salary is, and what are the terms of bonuses. I have dealt with many sales people who did not read their contracts through, and their contracts included a clause which said the bonus will be given at the company’s discretion, i.e., the company could not pay the bonus if “they didn’t feel like it”. Some companies will cap your bonus, so although you will get a bonus, it will not exceed £2K or £3K per year. You must also remember that until you get your bonus, all you are left with is the monthly income from your base salary. Good luck!

Answer 3

If your OTE is £100k, then you would generally have a basic salary (say £50K) and would earn commission or bonus depending on performance. With 100% performance acheivement of goals you would expect to hit your on target earnings of £100k for the year.

Also known as variable based pay.

Answer 4

In a nutshell. You have to sell what ever your selling for the day. If you have 10 cakes to sell per day for five days then you get OTE. If however you do better then you can get extra pay for it. On the other side if you fail to get your OTE then you will not get the full amount of pay that you was expecting.
For example you may get $200 a week flat rate they may say $300 a week OTE, this now makes you work hard for the extra $100. Hope this helps.

Answer 5

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On Target Earnings. It means ignore this ad and go and look for something else. If the ad says £30,000 OTE, generally speaking you can expect to make £8 to £10,000 a year, because their targets are set so high you will never achieve them. This is a universal rule.

Answer 6

Usually applies to a sales job, your target is your agreed sales target. Usually you earn a proportion of that back for hitting the target.

Your OTE is your basic salary plus your bonus for hitting the agreed target.

Answer 7

It means if you sell enough product to match the given sales target this is the money you will recieve but if not then you will get less money.

Answer 8

Means that's what you get if you hit your target. Usually used for salespeople.

Answer 9

In theory you should earn £xxx amount of money.

Answer 10

if you dont sell enough you earn less, if you sell more you earn more