Setting Quotas, Targets, Forecasts & Goals

by Brian Jeffrey

Here’s an excerpt from  the eBook . . .

As a sales manager, one of your annual tasks is to sit down with your salespeople and set mutually acceptable sales targets and quotas along with levels of sales activity. Then, for the rest of the year, you have to ensure they’re hitting their targets by monitoring their activities and results. And then, if they aren’t "making quota," it’s your job to find out why and help. That’s a major part of what sales management is all about.

A sales quota is the gross amount of business that either a salesperson says he can do or the company says must be done. It’s usually a target if the salesperson sets it and a quota if the company sets it. In either case, too many people generate the number using the SWAG method (scientific wild-ass guess). When you consider that hiring, product purchase, advertising, expansion and other decisions are made based on the estimated future earnings, it’s important they be set realistically.

I’ve seen too many companies hand down the numbers and then make operating decisions as though the numbers will come to pass, no matter what. This usually results in cash flow crunches followed by recriminations and scorn being heaped on the sales department for not making the numbers.

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