A compensation structure that is based on a percentage of the dollar income the nail professional generates from client services is referred to as what?

A compensation structure that is based on a percentage of the dollar income generated from client services is known as a commission structure. This approach aligns the earnings of nail professionals directly with their performance and sales generation. When nail techs are compensated based on commission, they have an incentive to increase their services and client satisfaction, which can lead to higher income for both the technician and the salon. This model is commonly used in the beauty and wellness industry, as it allows for potential earnings to grow with the professional's skill level and client base.

In contrasting structures, a salary structure provides a fixed income regardless of the sales performance, a flat rate structure might pay a set fee per service rather than a percentage of income, and an hourly wage compensates based on the time worked without direct correlation to service income. Therefore, the commission structure is uniquely designed to reward nail professionals for the volume of business they create and the quality of service they provide.