Sales and quotas go hand in hand. Sales quotas help teams meet targets, and with those targets being met, sales naturally increase. Because of this, sales quotas are vital to a company's sales strategy.

If you aren’t sure of the different sales strategies, How to Set a Sales Quota will educate you on the most commonly used sales quotas and what they are used for.

If you’re here to learn how to set a realistic sales quota, read on.

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Know your sales team and the resources

By this we don’t mean you know what every member of staff had for breakfast but you will need to get to know every team member individually. How many sales people focus on top accounts?  What are their conversion rates? How much time do they spend in meetings? All this information goes together to build a picture of how things are performing today, this week or this month. This is your starting point or reference, the place to improve from.

Flyte provides advanced analytics to understand how your sales team is prioritizing top customers and how much time is spent on each conversation. It also gives you recommendations on what your sales agent is doing well and where they can improve to be able to improve conversion rates.

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Understand sales history for last few months

You will also need some historical data. Knowing how the team was performing throughout the last few months, 6 months, 12 months, 18 months is all going to help when you set your sales quota. There is no point setting a quota that you know you’ll achieve easily, the same is true for goals you know you’ll never be able to hit. You want something in the middle - a realistic challenge!

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Flyte can help you analyze historical sales conversation data to learn about your team performance and how the seasonality or specific sales rep performance impacts the goals for your company.

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Start with bottom-up approach

Building on the previous point, the quota that is set must align with the data that was accessed in the ‘getting to know the team’ stage. Having an unrealistic target will deflate the team's morale over time and you may even find they perform worse than before or flat out leave. The go-to rule is that your quota should be achievable by 80% of reps.

Flyte helps you understand sales reps performance and customer pain points through aggregated analytics and competitive intelligence. So, you can set realistic goals for your sales team after analyzing their performance.

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Startups and the top-down approach

What if you don’t have months and months of data to fall back on? Maybe you’re a start up, what then? You’ll find, you have no choice but to go for the top-down approach i.e., setting a figure you want to achieve and filtering it down. This is fine as long as you use the data you find in the first few months to adapt and realign your quotas.

Flyte can help startups with individual call insights as well as aggregated insights to make informed decisions on how to improve reps performance and what is the right target for a startup to grow at a pace in line with competitors.

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Calculate sales quota

Take your reference point, set a realistic increase based on data and make your calculations. When quotas are set, is it worth saying that reps may not respond to ‘increase sales by 5%’. It doesn’t mean that much to them. It may be worth investigating other ways to present what you would like to be achieved. Usually this is done in activity form. It feels more manageable to send 10 extra emails and make 5 extra phone calls a week than to put a monetary figure to it. Another point to note is that if you are setting monthly quotas, not all months are equal (I think we all spend more in December!). Remember to take this into account. Yesware provides a calculation technique to calculate top-down as well as bottom-up sales quota.

Are you looking for a platform that can give overall view of how your sales team is performing to decide right sales quota, Flyte can help you with that. Contact us here and we will get in touch!

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Keywords: sales quota, sales coaching, advanced analytics, call insights, startups, historical data, sales teams, sales managers

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