Affiliate Store Commissions Explained – Zach Dewhurst

DecoNetwork provides fulfillment centers 2 options when it comes to letting an affiliate website (client) earn a commission from a sale. It is important to look at it in terms of wholesale (blank product + decoration costs) and retail prices (final sale price).

OPTION 1

Wholesale to Retail Markup

The fulfillment center sets the wholesale price and the affiliate can then add to it to create the final retail price and the difference is their commission minus the transaction fee. The default markup (% or fixed amount) is configured within the website and each product can have its price set to whatever the affiliate wants, but cannot be less than the wholesale price. 

OPTION 2

Sales Commission

The sales commission method revolves around rewarding an affiliate a % of the wholesale price, much like a sales rep on the commission would earn. Sales Commissions are less commonly used on DecoNetwork compared to the wholesale to retail markup method, but it’s a great tool to use in certain situations. The sales commission should be set to 0% as the default and then within the “Administrative” section of a website you can override the commission %. 

Referral Commissions

Referral Commissions allow a fulfillment center to reward an affiliate who recruits another affiliate by giving them a commission from each sale that the new site makes. The logic is that you might make less on a sale as you are providing a commission to another affiliate, but you would not have the client if it weren’t for them. So less unit profit, but more profit overall is the thinking.

Affiliate Transaction Fee

The affiliate transaction fee is typically the only fee/costs that deduct the commission of an affiliate when sales are made on the website. The following formula best explains how it works.  Wholesale Price (blank + decoration) + Markup (commission) = Final Retail Price, Commission = Markup – Affiliate Transaction Fee. As the affiliate increases the final price by marking up the product the payment gateway fees increase and the affiliate transaction fee allows you to pass on those fees to the affiliate. 

PayPal Mass Payout

To automatically distribute commissions to your affiliates, add your Paypal account email in DecoNetwork, then log into Paypal account and add DecoNetwork’s API credentials. Full instructions found here.


Zach Dewhurst, DecoPro

With over 10 years in the print & embroidery business, Zach consults businesses through DecoNetwork’s DecoPro services.

0 Comments

No Comment.