How to Set Sales Quotas (+ 3 Free Templates & Calculator)

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Written By Obaid Ur Rehman

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Sales managers and company owners may hold their staff accountable for performance by using sales quotas. Additionally, they let businesses to anticipate sales and divide larger targets into more manageable tasks that sales team members must fulfill, such monthly calls or revenue. You can acquire free sales quota templates for your small business in this post and learn how to create sales quotas as well as optimal management practices.

Here’s how to set sales quotas in three easy steps:

1. Determine Revenue Targets

Consider your desired level of organizational revenue in broad terms. To start, do a break-even analysis to ascertain the volume of revenues required even to maintain operations. Your break-even point comprises the sum of all of those yearly costs.

For instance, your break-even threshold would be $500,000 if you totalled up all the expenditures for salary, employee benefits, insurance, office supplies, software, marketing and advertising, and legal fees. Determine your goal profitability for that time period after setting that figure. This might be a profit figure, like $100,000, or a percentage, like 20%.

Decide how much of the overall income objective will come from repeat business (existing clients) and how much should come from new clients. Using the same scenario, we might set our new business sales objective at $200,000 if we had a $600,000 overall revenue target but knew that $400,000 would come via subscriptions from current customers.

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2. Develop Roadmap Objectives

The creation of a road map entails a number of steps, including deciding on a timeline and performance thresholds based on the kind of quota you want to set. In order to set minimal standards for your team utilizing one of three basic types of quotas, a sales manager must carefully consider their options.

  • Sales revenue quotas: The required quantity of income every week, month, quarter, and/or year
  • Deal-based quotas: The quantity of transactions that must be completed or the volume of goods or services that must be sold each week, month, quarter, and/or year
  • Activity quotas: The quantity of tasks that need to be finished each week, month, quarter, or year, such as the calls, emails, and appointments that need to be made

You may also like reading: How to Create an Effective Sales Report (+ Free Template)

3. Assign & Monitor Quotas for Each Rep

Your organizational quotas are the roadmap or objectives you define in the preceding stage. Assign the complete activity or production needs to each rep once you have them. Even while it would be simplest to distribute the objectives evenly across all the reps, we’ll go over the benefits of having customized quotas based on experience in the best practices section.

Once your salespeople have their quotas, keep an eye on their development to keep them on course. Give them a bonus, a day off, or another gift if they are performing far better than expected to motivate them to put up even more effort. If they are lagging, serve as a sales coach by yourself or one of your seasoned salespeople and find out how you may assist them. You might need to provide them with sales enablement tools like software or additional leads.

Free Sales Quota Templates

Free Sales Quota Templates
Free Sales Quota Templates

Quotas are essential for attaining sales objectives, but initially setting them can be difficult since it calls for financial and operational analyses. Because of this, we have developed three free sales quota templates that are appropriate for the main categories of sales success data you wish to assess.

1. Sales Revenue Quota Template

Use this revenue quota template to keep your team accountable for generating income. Based on your corporate goals, the top-down strategy enables you to divide revenue targets across teams and people.

2. Deal Quota Template

This template is for you if generating leads and obtaining new clients are your top priority. Deal-based quotas use a top-down approach to calculate the quantity of agreements required to hit revenue objectives. The measurements may then be divided and given to specific people on a quarterly, monthly, or weekly basis.

3. Sales Activity Quota Template

Use this template to create activity minimums for your team after you are aware of the amount of effort needed to move leads through the sales funnel. By starting with later phases of the sales process, you may utilize this strategy to determine how many calls, emails, proposals, or appointments are necessary to reach your sales objectives.

Best Practices for Managing Sales Quotas

Practices for Managing Sales Quotas
Practices for Managing Sales Quotas

You may increase the efficiency of sales quotas by implementing best practices in addition to our step-by-step procedure and free templates. You may add these more measures to quota setup and monitoring:

Use Historical Data

If you’re lucky enough to have been in company for a while, you probably have a basic understanding of how well your lead generation efforts perform, how well your pipeline conversions work, and what your average growth rates for revenue are. When establishing activity and productivity quotas, use this information. By using historical metrics to determine what has previously been accomplished, you may set performance standards.

For instance, it would be reasonable to demand a sales quota in that range if you had 15 sales representatives who each generated between $100,000 and $200,000 in revenue annually. However, requiring $300,000 in production or setting a far easier goal would be an impossible requirement.

Evaluation of seasonality in your sales activities is also aided by historical data. In other words, you can modify the monthly or quarterly minimums in accordance with the busy or calm months. It wouldn’t be reasonable to seek 25% in Q1, Q2, or Q3 if 70% of your sales typically occurs in Q4. You would probably need a large chunk of the production in Q4 and a lesser portion in each of the first three quarters.

Personalize Quotas Based on Experience & Position

Due to the fact that your team’s expertise and resources vary, it’s not always a good idea to divide sales quotas evenly. You should establish lower standards for rookie or inexperienced sales professionals and higher minimums for more seasoned sales agents.

Furthermore, while setting metric standards, consider the work role. Assigning sales quotas to specific sales development reps (SDRs) who are responsible for cold calling and arranging sales presentations for account executives (AEs), for example, may mean that their key performance indicators are just activities like cold calling made or appointments made. For the account executives, on the other hand, you probably care more about deals or revenue and should make that clear in your demands.

Managing current clients through customer service and client experience management is another aspect of sales. Although we’ve given examples of sales quotas for securing new business, same minimums can also be applied for customer retention.

For instance, you may specify that a customer success representative must meet production standards in order to maintain 90% of their accounts or $300,000 in sales annually. The task might also be a quota where you need X emails to be sent out informing clients that their subscriptions are about to expire.

Set Realistic Quotas

It’s harmful and bad practice to have unreasonable expectations while creating a sales culture. There must be a balance between a goal that is almost impossible to achieve and one that is much too simple. Low quotas provide representatives little incentive and may prevent you from taking advantage of potential revenue development. Employees will believe there is no use in trying if the quotas are out of reach since they won’t meet their targets.

Remember that just 24.3% of salespeople last year were successful in exceeding their sales quotas. To determine what is appropriate, use your past data. Work backward from your revenue objectives for the anticipated activity if you don’t have any data. You may need to reevaluate your pricing strategy if the daily or weekly effort you’re expecting from your team appears gruelling merely to reach a break-even point.

Utilize Technology

When it comes to automating your quota and performance management process, sales technology is really helpful. Using lead and deal data, CRM systems enable you to set individual rep quotas and monitor their success. For instance, you may select specifications to watch as actions happen and offers are completed using Fresh sales. The outcomes can be shown in a bespoke report or in the forecasting module to show predicted performance.

Another useful tool for sales teams is gamification software. Your staff will be more encouraged to work hard if you regard meeting sales quotas as a contest with points and incentives. Some CRMs, like Zoho, have modules incorporated into their system for performance management and gamification, while other systems are designed for these purposes.

A product that enables you to design and manage individual sales competitions amongst salespeople is Zoho Motivator. The contests’ point systems, game designs, regulations, and leaderboard layouts are all customizable.


Sales quotas outline the activity or production goals you anticipate your salespeople to meet within a certain period of time. Understanding your organization’s revenue objectives and working backward to establish appropriate performance measures are necessary for setting a quota. You may evaluate data to create quotas, measure progress, and encourage your staff to put in the work necessary to fulfill their quotas with the use of technology like CRMs or sales gamification tools.

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