Quota Management

What is a Quota?

A quota is a sales target assigned to individuals, teams, or territories. Quotas drive performance metrics, compensation, and motivation.

Quota Types

Revenue Quota

Definition: Total sales revenue target (e.g., $500K per quarter)
Use case: Account executives, sales teams
Measurement: Actual closed revenue vs. quota

Activity Quota

Definition: Number of calls, meetings, demos (e.g., 50 calls/week)
Use case: Inside sales reps, BDRs
Measurement: Logged activities vs. target

Unit Quota

Definition: Number of products sold (e.g., 100 new lines)
Use case: Retail stores, channel partners

Quota Assignment

Top-Down Approach:

Company Target: $50M annual revenue
Regional Split: East ($20M), West ($18M), Central ($12M)
Team Split: West Region has 3 teams, $6M each
Individual Split: Team of 5 reps, $1.2M each

Quota Periods

Annual: $2.4M for the year (strategic planning)
Quarterly: $600K per Q (most common for sales reps)
Monthly: $200K per month (high-velocity sales)

Performance Tracking

Quota Attainment

Formula: (Actual Revenue / Quota)× 100%
Example: Closed $480K of $600K quota = 80% attainment
Goal: 100%+ (exceeding quota earns accelerated commission)

Commission Tiers

Incentive Structure:

0-80% quota: Base salary only
80-100% quota: 5% commission on revenue
100-120% quota: 8% commission (accelerator)
120%+ quota: 10% commission + President's Club

Example: Q1 Performance Dashboard

Rep: Sarah Johnson
Quota: $600K
Actual: $720K (120% attainment)
Pipeline: $1.8M (3× coverage, healthy)
Win Rate: 35% (above team avg of 30%)
Commission: $72K (10% rate due to overachievement)
Ranking: #1 in Western Region