Sales Quota System

With the sales quota system, the remuneration of salespeople in the field is linked to sales targets, ie to the achievement of targets or target agreements. The employee's income increases with the degree of fulfillment of the sales quota or with his level of performance:

Actual performance x 100 rating = normal performance

The normal performance of a seller is understood to mean that performance that he can provide in the long term after training with average commitment. The normal performance of a seller is z. B. a certain target turnover or a target contribution margin.

Advantages of the sales quota system:

The system enables relatively performance-based remuneration, because different services with the same requirements affect the amount of the commission (principle of equivalence).

It enables the sellers' income to be adjusted annually to their performance and the market situation and situation of the company.

Die Verkaufsleitung und die Mitarbeiter im Außendienst werden dadurch veranlasst, sich im Rahmen der Jahresplanung intensiv mit dem Sales market und den Verkaufszielen zu befassen.

Disadvantages of the sales quota system:

The remuneration is unfair if the sales quotas do not correspond to the market opportunities (sales figures).

The sellers try to keep the sales quota low in order to increase their income by overachieving the quota.

The sales management tries to keep the sales quotas high in order to put the salespeople under pressure to perform.

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