Sales Commission Plan

Create competitive sales compensation structures.

Prompt Template

Design a sales commission plan for:

**Role:** [SDR/AE/AM/Sales Manager]
**Target OTE:** [On-target earnings]
**Base/Variable Split:** [60/40, 50/50, etc.]
**Quota Type:** [Revenue/Meetings/Pipeline]
**Sales Cycle:** [Average deal time]
**ACV Range:** [Deal sizes]

**Business Goals:**
- Primary metric: [What to optimize]
- Secondary metrics: [Other important factors]
- Behaviors to encourage: [Specific actions]

Generate:
1. Compensation structure overview
2. Commission rate tiers
3. Bonus/accelerator structure
4. Clawback provisions
5. Example scenarios at different performance levels

Compensation Components

Base Salary

• Provides stability
• Typically 50-70% of OTE
• Based on market rate and experience

Variable Compensation

• Tied to performance
• Motivates achievement
• Typically 30-50% of OTE

Commission Structures

Linear: Same rate for all sales
Tiered: Increasing rates at thresholds
Accelerator: Higher rates above quota
Decelerator: Lower rates below threshold

Example: Account Executive Plan

OTE: $150,000
Base: $75,000 (50%)
Variable: $75,000 (50%)

Quota: $1,000,000 annually

Commission Structure:
| Performance | Rate | Payout |
|-------------|------|--------|
| 0-80% | 5% | $0-40K |
| 80-100% | 7.5% | $40K-75K |
| 100-120% | 10% | $75K-95K |
| 120%+ | 12% | $95K+ |

Accelerators:
- Multi-year deals: +1% bonus
- New logo: +$500 spiff
- Strategic product: +2% on product revenue

Example Scenarios:
- 80% quota ($800K): $75K base + $40K commission = $115K
- 100% quota ($1M): $75K base + $75K commission = $150K
- 120% quota ($1.2M): $75K base + $95K commission = $170K

SDR Plan Example

OTE: $75,000
Base: $50,000 (67%)
Variable: $25,000 (33%)

Monthly Quota: 15 qualified meetings

Payout:
- Per meeting: $100
- Tier bonus at 15: $500
- Stretch bonus at 20: $1,000 additional