Let's discuss what is actually the right way to pay your Amazon FBA Virtual Assistant
Paying your Amazon FBA Virtual Assistant the right way can have a massive impact on your Amazon Business. Today, I’m going to go through the pros and cons of pay-per-deal and salaried payments. It’s not as clear-cut as you think, so stay until the end of this article as we go through this important question.
If you want the video format of this article, as usual, you can watch it right here.
Topic Rundown:
Define Salary and Pay Per Click
Let’s just talk about the differences between salary and pay-per-deal.
Salary
Quite simply, you have a contract with your Amazon FBA Virtual Assistant, and an agreement to pay them a certain amount every single month regardless of performance. You can pay that monthly or weekly or even every two weeks. In my business, we pretty much pay it two times per month.
Pay-per-deal
Now, the second option is pay-per-deal. So, simply there is no fixed amount to be paid. It’s a fixed amount per deal and you only pay for results. You only pay for the amount of money for the number of deals found. How often you pay that and the frequency is completely up to you and in your agreement.
That leads me quite nicely to talk about the differences in regard to employment and contractual basis. It might sound a bit boring but it’s important to understand.
Employment Difference
Salary VA: They are on a contract with you and they work for you and in your business. They have that security but you also have an obligation to pay them regardless of performance every single month. They are on an ongoing contract with you unless stipulated otherwise.
PPD VA: There is no contract for there is no obligation for them to work because if they don’t work they don’t get paid but if they do work and they do get paid. It’s more of a flexible arrangement, more like a freelancer.
Which way is better in terms of Performance
Salary VA: With a Salary Amazon FBA Virtual Assistant, you’ll probably see more consistent performance. They might not deliver as well in the number of results initially, because they are still learning to get it up, but you will probably see a consistent performance in the long run. VAs are going to be here to work to earn money, pay the bills and look after their family. Thus, ending in a consistent performance over the long term.
PPD VA: Generally, their motivation is money, which is going to be about finding deals. You might think this is a really good option to go for. In my experience, when you try to do something like this, you’re going to see a massive burst initially. Lots of deals coming in but unfortunately, that isn’t sustainable. Why? Because to achieve that massive burst, they probably work something like 12 or 14 hours which is not sustainable in the long run.
Get your VA from us
In Fast Track FBA, we offer VA Academy. This is an Amazon FBA Virtual Assistant Academy whereby we go out there and we interview, test, train, and do all contracts for a brand-new Amazon FBA Virtual Assistant that will work in your Amazon Business.
We support them to get the results you want for 12 weeks. We start by checking everything, making sure they are delivering results and supporting you with any problems that may arise. Fundamentally, it’s about getting the right person first and then supporting them with great training. Getting the wrong person, then everything else, is pretty much irrelevant.
We had a couple of clients come back for five Amazon FBA Virtual Assistants and right now we are training VAs all the time to support other Amazon sellers for manual sourcing.
Which way is better in terms of Work time
With a Salary VA, you can either do them on a schedule either work fixed hours or you can give them a flexible time. In my business, we give them a more flexible time because I don’t need to manage them on a day-to-day basis. They also don’t need to work set hours. All I really care about is the results as long as they’re doing the hours to get the results. That’s generally what happens on a salary basis.
On a pay-per-deal VA on the other hand, they will work whatever hours suit them. However, that might not align exactly with what you want from your business for the main reason that you’re paying them for the results. And if they don’t want to work today, then you’re not going to get any deals. Basically, they will only work the hours they need to earn the money to get the results. For example, in December they might be finding lots of deals but come January that will be a bit slower because they don’t need as much money.
Which way is better in terms of Business Impact or Results
Salary VA: I talk here from personal experience. One thing I will say is the results are probably less. Why? Your Amazon FBA Virtual Assistant will work for eight hours a day, then going to be learning, training, and getting up to standard.
Now, the number of deals you’re going to be getting per hour worked will be a lot less, but give an idea in the VA Academy in the first week or the first month. We’re probably looking at anything between three and five deals per day and that isn’t that many. What happens is over time, they learn and they get quicker; they get better. As a result, when after three months onward, you’ll be able to see the average anywhere between eight to 12 deals a day, even up to 15 on a good day. Just remember that you’re still paying the same amount of money, but you’re getting many more deals.
In the first few weeks, they’ve been getting in eight hours and they might still only be able to source three to five deals. What we see is they work a lot more hours. Why? They want the money. They will probably work 12 or 14 hours a day to find more deals and you might think that it’s great. Obviously, after three months, the Amazon FBA Virtual Assistant can now work four hours a day and get the same number of deals they need.
Your Salary VA might be working eight hours getting 15 deals whereas your PPD VA might be getting eight deals that they only worked in four hours, but you’re still paying the same amount.
What you’re seeing is the short-term you get, which is better results because there is an incentive to drive to get those results. As they take time to learn and get better and faster, you’re not going to get as many you’re going to pay more for the same amount of hours worked.
The downside is that they are driven by money, they now understand the value of that deal and might look for other clients to fill the amount they need. I’m not saying that they can sell the same deals, that’s not my place but there is always that risk.
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Which one is better?
Which one should you choose? Now, there is no right or wrong answer as they both have their pros and cons but I’ll do my best to explain that.
If you are looking for a very short term that may be one to two months to support you in getting a burst of deals, then probably look at something like a pay-per-deal Amazon Virtual Assistant.
Why? Because the incentive is to get results very quickly and they’re going to work towards getting that. Now, the reason why I say one to two months and that’s it is because every hour they work with you, they are learning the training to get better and you as a business owner want to reap the rewards of that investment.
Now, if you’re going longer than that, then have the Salary VA instead. It not only helps you manage your pay costs but also allows you to train and develop them, also retaining their expertise within your business. As mentioned earlier, they will give you much better results in the long run.
Find what works for your Amazon business!
In my Amazon Business, I look for building a sustainable business over the long term. And that is why I pretty much do things on a salary basis not saying that I haven’t done the pay-per-deal in the past. But now, I want everything to be sustainable in long run. I want to build in that expertise and their skill set within the team.
My Top Tip here is if you’re looking to build a business over long-term salaried employees is what I’d recommend. But of course, if you need something very short, sharp, and fast for just a few months, maybe a pay-per-deal would be the better option for you.
If you're still thinking, When is the right time to hire an Amazon Virtual Assistant? maybe it's time to read our article about it. You can also check our previous article named How to Work with your Amazon Virtual Assistant on Day 1: Top Tips for more information on this matter.