Basis of calculation of salary/CTC to Sales/BD/SM?

Question

a friend of mine is starting an IT services company.
Can anyone help out how to derive the salary/CTC to Sales/Business development, Sales Manager Co-Ordinators, Service Engineers.
What is the basis for calculation of remuneration to an employee to the company with around 1-2yrs of experience, especially in sales.
Say with a working profit of 5%-8%. (Please answer with relevance to INDIA)

Answer 1

To the best of my knowledge the components to include in the CTC are as follows...
1. Basic
2.D.A
3.HRA
4.E.A( Educational Allowance)
5.T.A
6.L.T.A
7.Leave Encashment.
8.Bonus.
9.PF subscription of the employer share.
10.cost of any housing or other accomodations provided by the employer.
11.Cost for Vehicle provided or vehicle allowance.
12.Any other aminities or services provided by the employer.
CTC is the concept primrilystarted with the American companies. Different parameters are used by different companies. However most comonly used items under the CTC is what the company spents directly on the employess excluding the cost of infrastructure (space, PC, aircoditoning, training etc)

It includes the salary directly paid to the employees, the benefits directly attriwhere company make a contributions like Provident Fund, Pension funds ( vary from country to country) Medical insurance premium, life insurance premium, cost of loans given to the employee ( some company even include the cost of the loan cost the employee is entitled but not taken) telephone expenses for mobile and home line.
Benefits offered for visiting the home country or hometown etc

# calculation of CTC is actually more an art than a science. Anything can become a part of CTC...

Many companies add the induction training cost to their CTC (e.g., if part of your training includes a one month "foreign" assignment, it is bumper addition to CTC - besides of course adding the "foreign" glamour to the job offer); some others also add the cost of subsidised lunch in the canteen in the salary package (e.g., you pay Rs 10, while it costs company Rs 150/-, and so, Rs 140/day get added to CTC). Similarly, stock options, market value of chamari accommodation, medical insurance entitlement (e.g., if one is insured for Rs 2lac by the company, that also goes into calculating the entitlements), etc. - or even the market value of infrastructure provided to you (office space, PC, etc.) can be - and sometimes are - part of CTC... A few years back, one MNC bank had given an offer of Rs. 9.0 lacs/annum to one of the students; of which Rs 6.0 lacs was for the rental value of a flat in Malabar Hills, which the bank was providing for her accommodation!!!
(to be fair, now many companies do share both the CTC and take-home salary, but somehow the CTC occupies a larger mindshare)

# Why do companies do this? Why not be just straightforward and realistic in quoting the salaries? One reason, of course, must be the economics of recruiting, i.e., apparently the person does "cost" them that much. But a more likely reason is the implicit knowledge that salary is the only (or at least the main) criteria which a young B-school graduate considers in deciding on a job... In fact, as the mail above indicates, it is often the main criteria for even joining the B-School in the first place.

Moreover, it is very rare that a student has actually studied the company s/he is applying for, for the job - information about the company is normally gathered through pre-placement talks (which most B-school students abhor to attend, and which often also present a pretty white-washed picture of the company), through feedback from their seniors who may have joined those companies, or through their own, or their batchmates', summer training experience in that company. Sometimes, the media reports (including the Best Employer Surveys, Best Place to Work, etc.) - specially, those published during last one years - also play a role.

But ultimately, the choice is determined by the salary package, since, under the peer-pressure during the "Placement Season", the salary also becomes a - one may say, the only - measure of one's self-worth.

# The myth of CTC-masquarading-as-high-salary, however, does not end here. It gets further perpetuated by the B-Schools themselves, when they quote salaries for the subsequent B-Schools Ranking Surveys done by different magazines and newspapers. Ostensibly, it is done to create awareness about the institute, and to maintain/build the institute's "brand" so that it can attract better recruiter (who quote higher CTC/salary), and better prospective students (who aspire for higher CTC/salary)... I am not sure if rankings also attract better faculty to join the institute...

Answer 2

Ctc Salary Calculator

Answer 3

HOW TO CALCULATE YOUR COMPENSATION (COST TO THE COMPANY)?

Total compensation includes the value of all the perks and benefits one gets from the Company in addition to ones salary. Calculating Annual Cost to the Company is important while changing jobs as it more often than not determines what your compensation will be in the new Company. At the same time all the components are not always apparent. In order to arrive at a comprehensive figure one has to carefully add the value of all components or their cash equivalent. Given below is a format which may be downloaded and filled up to arrive at the Annual Cost to the Company.
COMPONENTS APPLICABILITY AMOUNT

1.


SALARY DETAILS:



Basic Salary


Yes/No



House Rent Allowance


Yes/No



Company Leased Accomodation


Yes/No



Daily Allowance


Yes/No



City Compensatory Allowance


Yes/No



Special Allowance


Yes/No



Conveyance Allowance


Yes/No



Lunch Allowance


Yes/No



Entertainment Allowance


Yes/No



Books/Periodicals Allowance


Yes/No



Education Allowance


Yes/No



House Maintenance Allowance


Yes/No



Furnishing Allowance


Yes/No



Dress/Uniform Allowance


Yes/No



Other Allowances


Yes/No



2.


BENEFITS/ PERKS/ REIMBURSEMENTS



Value of Company Car


Yes/No



Car Subsidy(or equivalent tax savings)


Yes/No



Driver’s Salary


Yes/No



Maintenance and Petrol Expenses


Yes/No



Leave Travel Allowance


Yes/No



Canteen Subsidy


Yes/No



Telephone Expenses


Yes/No



Mobile Phone


Yes/No



Club Membership


Yes/No



Electricity/Gas


Yes/No



Servant/Gardener


Yes/No



Credit Cards


Yes/No



Furnishings/Durables


Yes/No



Holiday Facilities


Yes/No



Medical Reimbursements


Yes/No



Medical Insurance


Yes/No



Personal Accident Scheme


Yes/No



Others Benefits


Yes/No



3.


RETIRALS



Provident Fund


Yes/No



Superannuation Fund


Yes/No



Gratuity


Yes/No



4.


BONUS



Fixed Bonus


Yes/No



Productivity Linked Variable Bonus(*)


Yes/No



Any Other Performance Oriented Incentive including Stock Option Plan(*)


Yes/No



5.


SOFT LOANS



Interest Subsidy


Yes/No




GROSS COMPENSATION


(*) Please take the average value of the amounts received by you in the present grade, to reach at a fair estimate.


http://www.humanlinks.com/comp.htm

Answer 4

You should appointment a accountant, who will keep all pay roll record of company and he will calculate monthly salary of employee according working hours or as you will wish.Accountant will keep a attendance register and all employees will enter their In & Out time in register. You can also maintain a locking doors as in Citibank. This software will keep all records of employee, Anyone employee will go out or In, software will catch all present time in office. You can also develop your own attendance software from any development company. Thank You,

Answer 5

Go to Hotjobs and there under career tools it has a salary generator that can get really specific.