For sales teams, sales quotas act as a benchmark and are able to provide the motivation that reps need in order to perform their best as well as support the business’ goals. Many sales teams flourish with the assistance of quotas. The important thing is to set quotas that are both challenging in addition to attainable.
What Is A Sales Quota?
The term ‘sales quota’ refers to a time-bound sales target that is set by management for a specific region, sales team, or individual sales rep.
Sales quotas are typically attached to a daily, monthly, or quarterly period. Not only do sales quotas play an important role in sales forecasting and monitoring rep activity, but they also set expectations and motivate sales reps to achieve a given level of activity.
Managers can also use sales quotas to learn more about their team’s productivity, success rate, and optimal sales processes.
Setting sales quotas allows one to:
- Ensure compensation plans (including commissions) are fair and effective
- Reveal weaknesses or bottlenecks in the sales pipeline
- Highlight successful reps and replicate their sales techniques
- Monitor and regulate selling expenses
- Create achievable goals and benchmarks
