This blog looks at what exactly is sales quota attainment, why you should measure it, and how to calculate this metric for a certain period. What’s also explained is how you can get your sales team to achieve their quotas and how to use it to your company’s advantage. Some of the tips included are; offering continuous training, automating your sales process, setting flexible sales commission structures, and more.
Sales quotas are probably one of the oldest techniques used to ensure high sales.
Here’s a case history of how in 1939, a bread manufacturing company went about setting their sales quotas once they noticed a downward trend in sales. What’s important to note is that the system of setting sales quotas has been here for a while and is here to stay.
But companies today aren't having the best of times with sales quotas.
A study showed that in 2021, just over 24% of sales reps exceeded their quotas.
Quota attainment, or how many of your sales representatives have met their targets is an important indicator of the direction in which your company is headed.
In this blog, I’ll cover what quota attainment is, how you can calculate it, along with its benefits. I’ll also provide four sure-fire tips to help your sales team attain their quotas.
Let’s get started.
What is Quota Attainment?
Quota attainment is a sales performance metric. It measures a sales rep’s total sales quota (or goal) accomplished within a certain time period.
But what’s sales quota?
A sales quota is a target set by sales leaders that a rep must achieve within a certain period.
Learn more about sales quota here.
It helps determine the performance level of your sales reps and is particularly helpful while carrying out performance reviews.
Sales quota attainment is a very crucial benchmark of how your sales reps perform and it’s typically calculated monthly, quarterly, or annually.
Additionally, some companies have a team-based structure and give importance to the quota attainment of the whole team. While some companies might have different strategies for each sales rep and mainly consider the quota attainment of every individual.
How to Calculate Quota Attainment
We’ve already taken a look at what exactly quota attainment means, but let’s now take a look at how you can calculate it:
Here’s the formula for sales quota attainment:
Let’s say you’re the sales head of a company that makes pancake mix.
You have a team of 10 sales reps and each is given a quota of selling pancake mix worth $25,000 for a quarter. Now, sales rep A has an actual booking of $23,500.
So, their individual quota attainment would be:
Quota Attainment = ($23500 / $25000) x 100
= 0.94 x 100
= 94%
This means sales rep A has a quota attainment of 94%.
Note: Different companies have different thresholds for acceptable quota attainment rates based on the nature of products, type of clients, seasonality, etc
But how do you benefit from measuring quota attainment?
And what difference can it make to your sales strategy?
Let’s take a look.
Why Should You Measure Quota Attainment?
The most significant benefit of calculating quota attainment is that it not only shows how your sales reps perform individually but how your team performs as a whole. This helps determine if your strategies are working or need a bit of change.
Calculating your quota attainment can also be very helpful to management in terms of making decisions and predicting future performance.
Another use of this metric is that it helps in deciding compensation and incentives for your sales team. Incentives over and above their base salary are usually based on how good their quota attainment numbers are. It can give employee morale a boost and push them to work harder.
Additionally, quota attainment also gives you a check on your sales forecasting methods. And helps you plan changes in product or strategy to fine-tune your offering with what the market is looking for.
4 Proven Tips for Attaining Sales Quota
Let’s take a look at a few tips that can help your sales team to achieve their sales quota:
1. Offer continuous training
While almost all sales reps go through an induction program upon joining, retention of important information and strategies can be an issue. And in some market segments, customer demands keep changing and might require a dynamic sales strategy.
This is where continuous training and learning programs help.
Instead of just one induction session with an overload of information, you can provide fortnightly or monthly training sessions. This can keep sales reps updated with current market trends – helping them improve their strategies.
Moreover, this research project found that 78.6% of surveyed companies that have an effective continuous training program meet 100% of their selling quota. And 90% who hit 75% or more of their quota participate in sales training on a monthly basis.
2. Automate and simplify your sales process
Sales reps spend considerable time on support activities that don’t directly contribute to increasing sales.
Luckily, you can automate a lot of these time-consuming activities with the use of technology.
As a sales leader, it’s crucial that you create a simple sales process where sales reps spend the majority of their time selling your products or services.
Based on HubSpot’s Global Sales Enablement Survey, 61% of overperforming teams use their CRM to automate parts of the sales process, allowing reps to focus on selling instead of paperwork and data entry.
3. Create quality sales content
Creating high-quality internal and external sales content can go a long way in boosting the performance of your sales teams.
Internal content like call recordings, tutorials, and information booklets can improve the way a sales rep approaches the sales process and make more sales. On the other hand, external content like brochures, ads, and demos makes it easier for sales reps to convince potential customers about the quality that you deliver.
Consequently, low-quality external content can even push away clients who initially seemed interested.
So it’s important that you create a team that creates quality sales content, updating it from time to time, based on the requirements of your customers. You can also target specific segments of customers with personalized content pieces, based on their age and preferences.
4. Set flexible sales commissions
Many companies make the mistake of capping sales commissions and incentives.
This can prove to be counter-productive as it leaves no incentive for sales reps to push sales if they reach the maximum commission level. Especially in industries that have seasonal variations in sales.
That’s why a flexible sales commission structure will ensure that your sales are maximized during such periods because it gives sales reps an additional incentive.
Wrapping Up
Sales quotas are the most effective way to push your sales team to sell more and measure their performance.
However, it’s important that you plan them the right way.
There’s no one-size-fits-all approach and the quotas that you set for your team are dependent on many factors – including the nature of your product/service, its price, demand, etc
Calculating your quota attainment numbers at frequent intervals gives you a good sense of the progress and if you need to take any corrective action. This metric also clearly sets apart the best-performing sales reps and lets you reward them for their effort.
Go through the best practices mentioned above to make the most out of quota attainment.
But remember, like with any other aspect of sales, maximizing your quota attainment depends on how well you know your customer and the research you do to know their requirements better.
