PRICE-PREMIUM COMMISSION MODEL FOR SALES DEPARTMENTS: CONCEPTUALIZATION AND IMPLEMENTATION CONDITIONS IN THE DIGITAL ECONOMY

Olha Makarevych

doi:10.32782/2308-1988/2026-59-133

Olha Makarevych National University of Food Technologies https://orcid.org/0000-0003-2415-7929

DOI: https://doi.org/10.32782/2308-1988/2026-59-133

Keywords: price-premium commission, PPC model, sales department motivation, digital economy, intellectual capital, prospect theory, principal-agent theory, value-based selling, B2B sales, outcome-based incentives

Abstract

The article presents a theoretically grounded conceptualization of the price-premium commission (PPC) model for sales departments — a novel incentive mechanism in which a sales manager receives a defined share of the difference between the company's minimum allowable price (P_min) and the actual negotiated transaction price. The research addresses a significant gap in both Ukrainian and international literature: while commission structures based on revenue volume or gross margin are well-documented, the direct incentivization of negotiation quality as a distinct and measurable contribution to value creation has received insufficient scholarly attention, particularly in B2B enterprises offering customized products and services. The study integrates three theoretical frameworks: principal-agent theory, prospect theory, and the intellectual capital paradigm, positioning negotiation competency as tacit knowledge and a component of individual intellectual capital that constitutes a firm-level competitive asset. The core model is formalized as W = S + k × (P_actual − P_min). The article demonstrates why PPC is especially critical for enterprises producing customized products, where discounted prices propagate into downstream production problems. CRM/ERP integration is identified as a necessary condition for model transparency and behavioral activation. The model aligns with the global shift toward outcome-based incentives.

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