Sales quotas explained: 5 types, how to set them, and best practices for 2026

Your sales team missed the quarterly target by 15%. The post-mortem points to familiar issues: unclear expectations, inconsistent tracking, and reps who thought they were on track until the final week.

Sales quotas fix that when teams set realistic targets and review performance early enough to coach and adjust. A clear quota system gives reps direction, helps managers prioritize coaching, and gives leadership a cleaner view of forecast risk.

This guide breaks down 5 quota types, practical ways to calculate attainment, and a five-step approach for setting targets your team can work with. It also covers how CRM reporting and automation support ongoing quota management as your sales org scales.

Key takeaways

• Define quotas as measurable targets tied to a set period, role expectations, and performance reviews.
• Match quota types to your sales motion, market maturity, and what managers need to coach.
• Combine top-down goals with territory realities to set targets that reflect real opportunity.
• Track attainment throughout the period to spot risk early and adjust coaching priorities.
• Use monday CRM to track quota progress, pipeline health, and activity trends in one place.

What is a sales quota?

A sales quota is a specific performance target a sales rep needs to hit within a set timeframe, often monthly, quarterly, or annually. Teams typically set quotas around outcomes like revenue or deals closed, and they may also track leading activities that support those outcomes.

Sales quotas turn company targets into clear expectations at the rep level. They also create a consistent way to measure performance across territories and roles.

• Quarterly revenue targets: A rep might have a quarterly quota of $500,000 in new revenue, breaking down to roughly $167,000 per month
• Lead generation goals: An inside sales team could target 50 qualified leads monthly — about 12 to 13 leads weekly
• Performance accountability: These targets create accountability and give everyone a framework for measuring performance

Use quotas to define what “on track” looks like before the quarter ends. Clear quotas also help managers coach earlier, spot pipeline gaps faster, and set fair expectations across the team.

The difference between quotas and sales goals

Sales quotas and sales goals serve different purposes.

Sales quotas set measurable targets for individual reps or teams within a defined period. Organizations often tie quotas to compensation and performance reviews.

Sales goals set broader outcomes for the business, such as revenue growth, market expansion, or retention targets. Leadership uses goals to guide planning, then assigns quotas to translate those goals into accountable targets for each team and territory.

Why sales quotas drive revenue growth

Sales quotas give teams a shared framework for planning and evaluating performance. Well-defined quotas help leaders forecast more accurately, focus coaching where it matters, and keep teams aligned throughout the quarter.

Build forecast consistency over time

Tracking quota progress across the team creates reliable benchmarks. Over time, patterns in attainment and pipeline coverage make revenue forecasts easier to predict and adjust.

Quota visibility also supports planning beyond sales:

• Marketing aligns campaigns to pipeline needs and timing.
• Customer success prepares onboarding capacity as close rates rise.
• Finance plans cash flow using projected revenue trends.

Align daily work with business targets

Quotas translate company revenue goals into territory-level expectations. Sales leaders assign targets by region, segment, or role, then adjust based on opportunity size and rep experience.

Clear allocation helps teams focus their effort:

• Reps prioritize work that contributes directly to quota progress.
• Managers address specific gaps rather than broad activity volume.
• Leadership tracks progress without waiting for end-of-quarter reports.

Create visibility across the sales cycle

Quota visibility works best when teams review progress throughout the period. Regular check-ins and shared dashboards help teams spot risk earlier and adjust focus before small gaps affect results.

5 types of sales quotas every leader should know

Different quota types drive different outcomes. Choose quota types based on your sales motion, rep experience, and what leaders need to monitor. Many teams use a mix so they can balance short-term outcomes with long-term pipeline health.

1. Revenue quota

Revenue quotas set targets based on total sales value in dollars — the most common type because it directly connects performance to financial goals.

Common revenue quota structures:

• Senior account executive: $750,000 quarterly, requiring enough closed deals to generate that amount
• Inside sales reps: $50,000 monthly targets
• Enterprise reps: $2-3 million annually with quarterly checkpoints

Revenue quotas work best in established markets with experienced reps who understand qualifying opportunities and closing complex deals. They provide direct line of sight to financial performance and simplify compensation calculations.

The challenge: Revenue quotas can encourage excessive discounting or focusing only on large deals while ignoring smaller opportunities that build pipeline.

2. Volume quota

Volume quotas focus on quantity — units sold, deals closed, or contracts signed — emphasizing market penetration over revenue maximization.

Typical volume quota examples:

• Software rep: 15 new accounts quarterly, regardless of size
• Retail associate: 100 units monthly
• Inside team: 200 new customers quarterly to build a broad base

These quotas work during product launches when penetration matters more than immediate revenue, in markets with standardized pricing, or when building customer base takes priority over deal value.

These quotas encourage pursuing all opportunities rather than cherry-picking large deals. They’re particularly effective combined with revenue quotas to balance quantity and quality.

3. Activity quota

Activity quotas target specific behaviors that lead to results — calls made, meetings scheduled, demos conducted, emails sent.

Common activity metrics and their purposes:

• Calls made: 50 daily calls maintain steady prospecting
• Meetings scheduled: 15 weekly meetings keep pipeline moving
• Demos conducted: 5 weekly demos indicate healthy advancement
• Emails sent: 100 personalized weekly emails build relationships

These quotas work for new reps developing skills, long cycles where outcomes lag activities, or when building pipeline takes immediate priority. They’re often paired with outcome quotas to ensure reps do the work that generates results.

4. Profit quota

Profit quotas set targets based on gross margin rather than total revenue, encouraging focus on high-margin products and protecting profitability.

Profit quota applications:

• Margin-focused rep: Target $200,000 quarterly gross margin, requiring profitable deals
• Product-specific focus: Concentrate on products with 40%+ margins, steering conversations toward solutions that protect profitability

Profit quotas prove valuable in competitive markets where price pressure threatens margins, with complex portfolios where margin varies significantly, or when strategy prioritizes profitability over growth.

These quotas align behavior with financial health. Reps learn to sell value, qualify for budget, and position premium offerings.

5. Combination quota

Combination quotas blend multiple types to balance different objectives, creating a complete performance picture.

Example combination structures:

• Revenue + volume: 70% revenue quota ($500,000 quarterly) and 30% new account quota (10 clients)
• Multi-metric approach: 60% revenue, 20% profit, 20% activity

This rewards both revenue generation and market expansion. Another structure ensures reps close deals, close profitable deals, and build future pipeline.

Combination quotas work in complex environments where multiple metrics matter, with various product lines requiring different focus, or when balancing short-term results with long-term building.

How to calculate quota attainment

Getting quota calculations right isn’t just about math—it’s about fair pay and accurate performance tracking. The basic formula is simple, but you’ll need to tweak it for new hires, partial periods, and more complex situations.

Basic quota attainment formula: (Actual Results ÷ Quota Target) × 100 = Attainment Percentage

Simple calculation examples:

• Rep with $400,000 sales against $500,000 quota = 80% attainment
• Someone closing $650,000 against $500,000 = 130% attainment
• Team closing 45 deals against 50-deal quota = 90% attainment

Partial period calculations:

Partial periods require pro-rated calculations. A mid-quarter hire might have $250,000 pro-rated quota (half the full $500,000). If they close $200,000, attainment is 80% against adjusted quota.

New hire ramp calculations:

• Month one: 50% of full quota ($25,000 of $50,000 monthly)
• Month two: 75% ($37,500)
• Month three forward: 100% ($50,000)

Combination quota calculations: With 70% revenue quota ($500,000) and 30% new accounts (10 accounts), achieving $450,000 revenue (90% attainment) and 12 accounts (120% attainment) yields: (90% × 0.7) + (120% × 0.3) = 99% total.

Top-down vs bottom-up quota setting

Sales teams typically set quotas using one of two approaches. Each method has strengths and tradeoffs, and the right choice depends on how stable your market is and how much data you have at the territory level.

When top-down quota setting works best

Top-down quota setting starts with company-level targets and distributes them down to regions, teams, and individual reps. Leadership defines the revenue goal, then allocates quotas based on organizational structure.

This approach works well when:

• The business operates in established markets with predictable performance patterns.
• Historical data provides a reliable baseline for future growth.
• Leadership needs to move quickly through planning and rollout.
• Sales strategy requires hitting a specific revenue target within a fixed timeframe.

Top-down planning keeps teams aligned to company goals and speeds up the quota-setting process. It also gives leadership more control over how targets distribute across the organization.

The limitation is accuracy at the territory level. Quotas may overlook differences in market maturity, account mix, or competitive pressure. Reps in slower or shrinking territories may receive targets that do not reflect real opportunity.

When bottom-up quota setting makes sense

Bottom-up quota setting builds targets from the ground up. Teams analyze territory potential, rep capacity, and pipeline data, then roll those projections into regional and company forecasts.

This approach is most effective when:

• Teams enter new markets without historical performance data.
• Territories vary widely in size, opportunity, or competitiveness.
• Major changes disrupt past performance, such as re-segmentation or pricing shifts.
• Sales leaders want stronger buy-in from reps and frontline managers.

Bottom-up planning produces quotas that reflect actual selling conditions. It often surfaces territory imbalances early and helps leadership understand where capacity or coverage needs adjustment.

The tradeoff is time and risk. Detailed analysis takes longer, and aggregated forecasts may fall short of revenue targets leadership expects or needs to hit.

Using a hybrid approach

Many teams combine both methods to balance alignment and realism. Leadership starts with a company-level target to define growth expectations. Sales leaders then validate those targets against territory data and rep capacity.

When the numbers diverge, teams can adjust assumptions, revisit headcount plans, or refine quotas before finalizing targets. This approach helps teams commit to quotas that support business goals while reflecting real selling conditions.

5 steps to set sales quotas that actually work

Effective quota setting relies on data, market context, and team input. A structured approach helps leaders set targets that reflect real opportunity and support consistent performance.

Step 1: Review historical sales performance

Past performance provides a baseline for realistic quota setting. Look at individual and team results over the last 2–3 years, focusing on consistency, trends, and seasonality rather than single high or low periods.

Key indicators to review include:

• Consistency patterns: Reps who regularly land within a narrow attainment range often support higher or steadier targets.
• Performance swings: Wide fluctuations signal uneven territories, pipeline gaps, or skill development needs.
• Seasonal trends: Many teams see uneven revenue distribution across the year, which quotas should reflect.

Territory-level trends also matter. If certain regions consistently outperform others, quota allocation should account for those structural differences rather than applying uniform increases.

Step 2: Assess market conditions and territory potential

Quota targets should reflect current market conditions, not assumptions based on past performance alone. Territory size, buyer demand, and competitive pressure all influence what teams can realistically achieve.

Key factors to evaluate include:

• Territory growth rates: Expanding markets can support higher targets than flat or contracting ones.
• Competitive dynamics: New entrants or pricing shifts may affect win rates and deal size.
• Economic signals: Budget constraints or increased spending within an industry influence buying behavior.

Use market research, customer feedback, and pipeline data to ground quotas in current selling conditions.

Step 3: Account for rep experience and ramp time

Experience level directly affects quota capacity. New hires and recently promoted reps need time to ramp, while consistent performers often support higher targets.

Consider:

• Ramp periods: Many reps need 3–6 months before carrying full quota.
• Tenure and track record: Sustained performance over time provides a stronger signal than short-term results.
• Skill development: Role changes or new product lines may temporarily affect capacity.

Progressive ramp structures help teams set expectations clearly. For example, reps may carry 50% of quota in the first month, then increase gradually until reaching full quota.

Step 4: Plan for change without constant adjustments

Markets shift, territories evolve, and quotas need room to adapt. Define clear criteria for when adjustments apply so teams understand what triggers a review.

Common adjustment triggers include:

• Scheduled quarterly reviews to confirm targets still align with conditions.
• Significant territory changes or account losses outside a rep’s control.
• Market disruptions that materially affect demand or competition.

Clear guidelines help teams respond to change while maintaining consistency and trust.

Step 5: Validate quotas with the sales team

Involve reps and frontline managers before finalizing quotas. Their perspective often highlights gaps in assumptions or territory coverage that data alone may miss.

Effective validation includes:

• Reviewing territory assumptions together.
• Pressure-testing targets against pipeline and account data.
• Explaining how leadership arrived at the final numbers.

This step builds alignment and helps teams commit to targets with a shared understanding of expectations.

Track quota performance with real-time intelligence

Track quota progress throughout the quarter rather than waiting for end-of-period reviews. Ongoing visibility helps managers focus coaching where it matters, helps reps prioritize week to week, and gives leaders a clearer view of forecast risk.

Many revenue teams centralize quota tracking, pipeline updates, and activity reporting in one system so performance stays connected to day-to-day deal work. monday CRM supports this approach with customizable boards, dashboards, and automations that surface progress and highlight gaps without manual reporting.

Metrics to monitor alongside quota attainment

Quota attainment shows where teams stand, but it does not explain what drives performance changes. Supporting metrics give managers the context they need to diagnose issues and take action.

Focus on a small set of metrics that match your sales motion:

• Attainment percentage: Tracks progress toward quota at any point in the period.
• Run rate: Estimates end-of-period performance based on current pace.
• Pipeline coverage: Compares remaining quota to open pipeline value.
• Activity trends: Monitors leading indicators such as meetings booked or follow-ups completed.
• Stage movement: Shows where deals slow down or stall in the pipeline.

Use automation to surface risk earlier

Teams miss quota for predictable reasons, including stalled deals, shrinking pipeline, and inconsistent follow-up. Automation helps flag these signals sooner so managers can respond before gaps widen.

Set up workflows that support faster action:

• Flag deals that remain in the same stage too long.
• Highlight reps whose pipeline drops below a defined threshold.
• Prompt regular pipeline updates ahead of forecast reviews.
• Trigger coaching tasks when activity trends decline over several weeks.

Build dashboards that support coaching

Dashboards work best when they guide action, not just reporting. Give managers a clear snapshot of where performance stands and where to focus attention this week.

Common dashboard views include:

• Quota progress by rep, team, and region
• Pipeline coverage against remaining quota
• Deals by stage and time in stage
• Weekly activity trends tied to your sales process

Turn quotas into a repeatable performance system

Sales quotas connect company targets to daily sales execution. Strong quota design clarifies expectations, supports focused coaching, and improves forecast visibility throughout the quarter.

Treat quota management as an ongoing operating rhythm rather than a quarterly spreadsheet exercise. Set clear targets, define how teams credit attainment, review progress early, and adjust coaching priorities based on real performance signals.

monday CRM helps revenue teams manage quotas with connected reporting, flexible workflows, and dashboards that bring pipeline and performance into one view.