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Request Letter by Agent/Business for Hike in Commission Rates

A business organization or a proprietary concern could be the agent of a company for selling its goods or providing services and getting commission at a certain percentage on the billing amount paid by the consumer. This commission rate doesn't always remain the same.

While some of the times the concerned product brand company increases or decreases the commission rate on their own, some other times the agent has to request for increase in the rate of commission rate.

sample request letter to increase commissionIf the agent/business really feels like and believes that it would be quite logical to ask for a hike in the percentage of commission at that particular point of, then they must request the company for such hike. It would be necessary for the agent to evaluate the pros and cons before going ahead with the demand for higher commission rates. Sometimes the company might take it in a wrong way and stop supplying any further goods.

Hence, it is important that the request letter from the agent's side should be drafted in a very polite way, yet in a very logical way so that it should sound more convincing for being eligible for a hike.

Following format can be suitably modified for the use.


Ref: .......................
Date: ......................

(Name of the Agent)
(Agency Number)
(Full Address)
(Phone no.)

(Name of the Officer)
(Name of the Company)

Sub.: Request for increase in commission rates

Dear Mr. ...................,

Greetings of the day!

I hope you are doing well. It's been quite some time since we have met. Sorry, due to work pressure I have not been able to find time to come visit you to discuss some more business prospects and life in general, of course.

At the outset, I would like to once again thank your company for giving our business an opportunity to sell your products and services. It has been over 5 years since we have been a loyal agent of your company. The brand has earned a good reputation in the market and we are happy to market the products sincerely.

However, we are concerned about the current rate of commission paid to us by your company. In the last two years, the commission rates stand same at 8%. The current market trend for commission rate in our industry is in the range of 10-12%. You would appreciate we had not raised any concerns regarding the commission rate for the last 24 months, which is a pretty long period of time and a hike in commission ought to have happened for at least once by now.

We have also been sponsoring our own marketing and advertising campaigns in certain localities and through online mediums for the increase in popularity of products targeting specific category of prospective customs. In order to increase the sales we have also been employing more sales personnel. The addition costs for this purpose are coming out of our profits and hence the cost burden is becoming more and more heavy on us.

In the past 24 months, we are proud to say that we have achieved the given sales targets for most of the months except for only 2 months which were only 5-10% lower than targets. Our sales figures for your brand products are stably growing despite cut-throat-competition in the market.

As such, we would like to request your goodself to consider our submissions as mentioned above and approve an increase in rate by 2-3%. This would further come as a great encouragement in ramping up the sales more vigorously and makes us a bit more comfortable in doing business.

We shall be grateful to you for your kind consideration on our request.

Thanking you!

Yours faithfully,

(Name of the Agent)