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Setting Sales Quotas: Advanced Guide for B2B Sales Leaders

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Setting and tracking sales quotas is a high-stakes task for sales leaders. While quotas can be a powerful motivatororce for your reps on the grouthey can also createng about unrealistic expectations and pressures that cause stress and staff turnover.

In this guide, we’ll:

  • Break down different quota types so you can decide which one suits your needs best
  • Tackle common challenges of setting realistic quotas
  • Walk through clear steps to set quotas that improve performance and inform strategy
  • See how automation and AI tools make your job easier

So, whether you’re revising your sales plan or building it from the ground up, this resource will make the process easier for you.

What is a sales quota? Key concepts and concerns

Sales quotas are specific, time-bound milestones that are typically set each quarter, though you may also set them monthly or annually. These quotas can be based on the number of units you sell and the profit you make, or they can be sales activity-related.

Businesses set sales quotas to turn broad sales goals and targets into clear, actionable tasks and to keep salespeople and teams focused and on track. When goals are translated into specific sales quotas, everyone knows what’s expected of them, and it becomes easier to track progress, measure success, and drive accountability.

So, while sales quotas, targets, and goals may sound similar, they’re actually quite different—as we discuss next.

Sales quota vs. sales goals and targets

Sales goals define the big-picture objectives, like increasing revenue by 20%—they guide your company’s overall strategy. Sales targets break sales goals into actionable milestones, like closing $1 million in deals each quarter.

Sales quotas then define these ideas further, with specific, time-bound tasks assigned to salespeople or teams, like having each rep generate $100,000 in monthly sales.

Therefore, your sales quotas should be aligned with and build toward hitting your broader sales targets and goals.

6 Types of sales quotas and when to use them

Different sales quotas serve different business goals, so understanding common quotas will help you choose the right one for your team and objectives. We explain their differences below.

Activity quotas

Activity quotas are targets for specific sales actions within a time frame. For example, they specify the number of cold calls or emails SDRs must make within a month or quarter.

Activity quotas aim to keep the sales pipeline warm and focus on sales activities that lead to sales rather than the sale itself.

Activity quotas work best in industries with long sales cycles, like B2B SaaS, real estate, or consulting, where building strong client relationships is important. They also help new hires focus on learning without the pressure to close sales.

While they’re valuable, the key is to balance them with sales KPIs so you know that your efforts translate into actual sales.

Volume quotas

Volume quotas are the number of sales an SDR must make within a specific period. Sales teams most commonly use volume quotas to motivate reps and generate revenue.

Volume quotas suit teams selling standard products in competitive markets, where the focus is on quantity over individual sale value. They're ideal for high-volume, low-margin industries like retail, manufacturing, or FMCGs.

Revenue quotas

Revenue quotas focus on the total money a rep brings in, not the number of sales or items sold. For example, the total income a rep needs to bring in over a specific period, whether with many small-scale sales or a small number of high-value sales.

Revenue quotas help you prioritize high-value deals and align your sales efforts with revenue goals. They’re best for industries like real estate, consulting, or enterprise software, where deal values vary and profitability matters more than volume.

Profit quotas

Profit quotas are net profit a salesperson must make within a specific time. This means making high-margin sales that help profitability rather than going for revenue or volume.

Companies with varying profit margins, like FMCG, manufacturing, or consulting, use profit quotas to maximize profits.

Forecast quotas

Forecast quotas rely on past sales data and market trends to set targets. Sales professionals use pipeline data to predict outcomes and assign quotas, often slightly higher than the previous quarter.

These work best in stable markets with consistent sales performance, like consumer electronics or B2B SaaS.

For example, B2B SaaS companies use forecast quotas by analyzing past subscription renewals and growth trends to set realistic sales quotas.

Combination quotas

As the name implies, combination quotas use a mix of metrics like revenue, profit, and sales activities to focus on diverse goals. They look something like this:

  • Revenue: Generate $50,000 in sales.
  • Activities: Conduct 30 new product demos.
  • Profit: Ensure at least $10,000 in profit from high-margin deals.

Combination quotas are commonly used in industries with complex sales processes and diverse product lines, like technology, manufacturing, and pharmaceuticals.

Benefits for sales teams and managers

Sales quotas set clear expectations and make it easier to measure your sales performance.

When a rep knows exactly what’s expected—whether it’s a certain number of calls, deals closed, or revenue generated—it reduces ambiguity and lets them focus all their efforts on hitting those targets. This also helps them prioritize tasks and allocate time and resources where they matter.

Also, when quotas incentivize reps through bonuses or commissions, it naturally motivates them to reach their targets.

Sales quotas also help managers assess individual performance and identify areas for improvement. If a salesperson struggles with activity quotas, such as cold calling, managers can offer tailored training, review sales calls, or provide tools to improve objection handling.

Common challenges when setting quotas

Setting sales quotas is tricky because of all the factors sales leaders need to incorporate into their calculations. Some common difficulties you might encounter are:

  • Inaccurate data and projections: Quotas built on unrealistic market expectations or flawed data frustrate your team members and derail your progress.
  • Overlooking team or resources: Assigning identical quotas without considering territory size or potential, team strength, or resources available creates an uneven playing field.
  • Going for equality not fairness: Fair isn’t always equal. Uniform quotas ignore individual strengths and workload differences. They can overwhelm new hires and underestimate your most experienced team members.

How to set and track sales quotas in 6 steps

Creating realistic and achievable sales quotas requires a structured, data-driven approach at every step.

Here’s a six-step process to keep your quotas fair, aligned with company goals, and integrated with sales tracking.

Step 1: Establish a baseline using historical data and call analytics

You need a certain number of sales each year to sustain your business—this is your baseline. To determine it, review past sales performance data and analyze indicators like total revenue, deals closed, and average deal size to identify trends and seasonal fluctuations.

Orum’s Call Analytics and Rep Performance Dashboard track key metrics like dials, connections, conversations, and meetings to give you insights into individual and team performance.

This will help you identify average performance levels, and establish a solid reference point for comparing team members, setting quotas, and adjusting expectations.

Graphic showing 6 steps to setting and tracking sales quotas
Orum’s Analytics filters to view data over a certain period.
Use Orum Call analytics to view team or rep performance over a certain period.

Step 2: Decide on a top-down vs. bottom-up approach

Once you have a clear baseline, you can choose between a top-down or bottom-up approach, depending on your company culture.

Top-down approach

Top management sets sales quotas based on revenue targets and passes them down. For example, if they aim for a 20% revenue increase, they might assign each regional manager a $1 million quota. Regional managers then break this down into targets for their sales teams to hit the goal.

While this approach helps you align sales quotas with your company’s overarching goals, it’s less flexible as top-down decisions may overlook on-the-ground realities.

Bottom-up approach

With a bottom-up approach, your sales reps suggest their own quotas based on their knowledge and experience. Then, the upper management adjusts these to match the company's overall goals. This process repeats until the quotas meet both individual and company needs.

For example, if a salesperson suggests a quota of 15 sales a month based on last year’s average sales, the manager may adjust this quota to 20 sales per month as part of their 5-year plan to double sales.

Giving salespeople a voice in the decision-making process can improve their motivation and increase their accountability—but setting up quotas this way involves more steps and can take more time.

If you decide to go for a bottom-up approach, use Orum’s detailed Analytics to give higher-ups a realistic view of on-the-ground sales performance.

Orum’s Analytics dashboard showing rep performance.
Orum’s Analytics Dashboard provides detailed insights into individual and team performance.

Step 3: Factor in market conditions and growth targets

In an ideal world, quotas are set, and everything goes smoothly. But in the real world, external factors like economic trends, market volatility, and seasonality impact sales and force you to adjust quotas.

Having proactive processes in place gives you a clear direction in such situations. You can quickly adjust your sales quotas, minimize time waste, and stay focused on hitting your growth targets.

The best way to prepare is by using real-time market data to stay aware of and assess key factors like consumer spending trends, industry growth rates, and seasonal fluctuations.

Here’s what we recommend:

  • Keep regular tabs on important industry reports to stay informed about economic conditions.
  • Use data tools and CRM integrations to consolidate historical performance data and real-time market insights. For example, Orum’s Analytics gives you a clear view of call metrics, helping you identify trends and areas for improvement.
  • Implement feedback cycles with reps to stay connected to the market. Orum’s Call Library and Screensharing make this easier by allowing for call recordings and easy collaboration to share insights and refine strategies.
  • Enhance your training to ensure individuals are using the most successful sales strategies.
Orum Call Library recordings.
Easy access call recordings and transcripts with Orum’s Call Library help you review sales rep performance and refine strategies.

Step 4: Adjust quotas to individual reps and territories

Even with careful planning, it’s easy to set quotas that look great on paper but are unachievable in reality. When this happens, it backfires and demotivates sales reps and teams.

So, how do you make sure your sales quotas are fair and realistic? You personalize them to each team and rep.

Try these three approaches:

  1. For experienced reps: Review past performances and increase by 10%.

    Use Orum’s Analytics to examine key metrics like connect ratios, conversation ratios, and meeting ratios. The benchmarks feature flags underperformance and highlights top performers, helping you set fair quotas.

    For example, if a rep averaged $50,000 in monthly sales last year, set their new quota at $55,000 to push them to improve performance without overwhelming them.
Orum Outbound Analytics shows performance benchmarks.
Orum Analytics provides performance benchmarks so reps can see where they stand, self-evaluate, and improve.

2. For teams working in diverse markets: Base quotas on territory potential, market share, and market size.

For example, give a rep in a high-demand urban area a $100,000 quota, and set a $70,000 target for someone in a smaller, rural market.

3. For teams with varying experiences: Scale quotas on experience level and workload.

For example, you could set new hires a $30,000 quota for their ramp-up quarter, while experienced reps aim for $70,000 or more.

Step 5: Communicate quotas effectively to your team

After setting your sales quotas, you need a CRM to make quota communication clear, actionable, and transparent so all stakeholders are aligned.

Here’s how you do it:

  • Use a CRM that pulls in updated data and centralizes it for easy access.
  • Build dashboards that track both SDR performance and overall team progress.
  • Set up individual dashboards to show key metrics like deals closed, quota attainment percentage, and pipeline status to help reps see where they stand.
  • Use your CRM to send real-time updates on progress, quota achievement, and any changes.
  • Use Orum’s Manager Notes to give reps instant feedback and leave notes directly on their screen.
  • Hold weekly or monthly team and individual meetings to review performance, answer questions, and identify areas for improvement.
  • Arrange support or training if needed, like skill-building sessions or coaching.
Orum Manager Notes showing options for leaving notes on calls.
Use Orum’s Manager Notes to leave feedback for reps to review.

Now that we've established how a CRM can enhance quota communication, let's explore how Orum’s real-time tools take this a step further by optimizing quota attainment.

Step 6: Monitor and optimize quota attainment with real-time tools

Whether it’s reallocating resources, refining calling strategies, or adjusting quotas, Orum’s real-time tools put you just one step away from taking action.

Here’s how Orum eases your workload and fast-tracks your progress on quota attainment:

  • Account Performance Dashboards track and show all critical performance metrics in one place, so you can instantly see progress and identify bottlenecks.
  • Live Listen lets managers monitor calls in real time for immediate coaching and feedback.
  • AI-Powered Dialer speeds up processes by automating dialing to increase call volumes and live connections.
  • When to Call Dashboard helps you optimize call times based on peak times.
  • The Call Library gives you recordings and insights for training, coaching, and improving sales tactics.
  • Objection Detection automatically transcribes calls and flags common objections so reps can address them proactively and improve their success rates.
  • Orum Analytics also automatically highlights key trends and underperformance, so your managers don’t need to analyze data manually. For example, a sales rep with low connection rates or call volume is flagged in real-time for immediate action.

Setting realistic sales quotas

Sales quotas can only drive accountability, productivity, and growth when:

  • They are well-designed: Data-based, tailored to individual reps or teams and aligned with your company’s overall goals
  • They are continuously tracked: For timely adjustments as market conditions and other key factors fluctuate
  • They are supported by real-time insights: So sales teams have the transparency they need to identify issues and refine their strategies

In short, setting realistic and fair sales quotas requires careful planning, data-driven insights, and the right tools.

Orum simplifies this process for you. Integrate Orum into your existing workflows to refine your quotas, motivate your team, and track progress in real-time.

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