How can Lisa Dynondo encourage her salespeople to promote the more profitable model?
A) Put all sales persons on fixed salary.
B) Provide higher sales commissions for higher priced items.
C) Provide higher sales commissions for items with the greatest contribution margin per constrained resource.
D) Provide higher sales commissions for items which has the lowest cost and lower sales commissions for items with highest cost.

Question

Quizplus · Accepted Answer

By providing higher sales commissions for items with the greatest contribution margin per constrained resource, Lisa Dynondo is encouraging her salespeople to promote the more profitable model. This incentivizes the salespeople to focus on selling products that provide the highest profit margins for the company, while also ensuring that the sales team is motivated to sell items that are constrained by resources, as these are typically the highest margin products. This strategy helps to maximize the profits of the business by aligning the incentives of the sales team with the goals of the company. Option A is not recommended as fixed salaries would likely lead to lower motivation and performance. Option B could lead to salespeople focusing solely on selling high-priced items, potentially ignoring other profitable products. Option D does not take into account the contribution margin and could potentially result in selling products that are not profitable for the company.

How Can Lisa Dynondo Encourage Her Salespeople to Promote the More