T
T

TLT00775

District Manager, Inside Sales

Contributor
Fire Starter
Good Citizen

What is a good target incentive (TI)?


Some Background: I work in Human Resources Outsourcing slinging hr software to small business. base is 43k (recently got a raise from 35k)
I'm still learning the ropes of sales  commission here (one thing for sure they never make it super easy to understand) recently realized that my target intive if I hit 100% of my 95k quota is 15k. now I'm not sure if that's good, average, or I need to jump ship to find a better commission structure. 

.


💵 Finance
☁️ Software Tech
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27 comments

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JustGonnaSendIt
Politicker
17
Burn Towns, Get Money
Usually on here you'll see sales compensation discussed in terms of On Target Earnings (OTE).

OTE typically breaks down into 2 components - Base and Variable.

In your case, it sounds like your Target Incentive is the Variable component. 

Seems like your OTE is 58K (43 Base + 15 TI), with a 95K quota. I'm assuming this is annual since you're talking about your TI and Base in the same time scale. Is this correct?

If that's the case, you're getting ~15.8% commission rate on deals up to 100% quota. 

Likely, the "multiple" refers to a way of scaling the commission rate based on your attainment against goal.

So, you'd get ~9.5% commission rate from 0 - 50% attainment, ~22.1% commission rate from 50% - 100%, and ~31.6% commission rate above 100% attainment.

Overall, this commission rate is actually pretty great, if my thinking is correct. You could make some decent $$ if you hit 200% of quota, for example.

Not a bad entry-level role, but the overall OTE feels a bit low, along with the quota.
braintank
Politicker
3
Enterprise Account Executive
Very well said!
Kamran
Opinionated
1
Mortgage Broker
Wow I don't know how you did that math but if my base is 74k and ote is 114k so 40k commission if I hit 100% quota which is 6 meetings a month...

How do I calculate my commission percentage? Lol
JustGonnaSendIt
Politicker
0
Burn Towns, Get Money
Well... usually you'd calculate commission percentage based on a dollar value quota. So you're essentially getting some percentage of every dollar sold, in each bucket of the comp plan.

When you're setting meetings, it's more like a per-meeting bounty rather than a payout percentage on a transaction.

In your case I'll make some assumptions and perhaps it can help you out:

- Variable is 40K / year
- Quota is 72 meetings / year (6 Meetings / month x 12 months)

This comes out to a pay rate @100% annual quota of $555.56 / meeting ($40K commish / 72 meetings).

My first BDR role paid $500 / meeting, about 10 years ago. So this is a decent payout actually.

If you have any progressive ramp rates like OP, this would clearly impact this payout as described above.

Does that help? 
UrAssIsSaaS
Arsonist
6
SaaS Eater
In terms of your commission per deal this is really solid as @JustGonnaSendIt broke down. 

Thats where the positives end for you though. Unless you live in a third world country idk how you live off that. I made that much in my first role out of college 10 years ago. 

With the current job market id find something else.
JustGonnaSendIt
Politicker
3
Burn Towns, Get Money
Totally agree. That OTE is just rock bottom, even for entry level.

BDR job in Tech will pay nearly double that AND put you on the path to bigger earnings in the future.
TLT00775
Contributor
1
District Manager, Inside Sales
This is my first role out of college 😅. The company has a great reputation when it comes to training and getting experience to get to that next role.
UrAssIsSaaS
Arsonist
3
SaaS Eater
My point is that I made that amount in my first role out of college 10 years ago. Meaning that even if you just take inflation into account you should be making like 30% more than that. Not including that the job market is super hot and any tech role SDR will have a base thats more than your OTE.

My friend, youre getting fucked. 
TLT00775
Contributor
1
District Manager, Inside Sales
Appreciate the hard dose of truth. I have been applying around, mostly medical. I’m gonna start taking a look into tech. Thanks
braintank
Politicker
2
Enterprise Account Executive
Do you get paid a percentage of the deal? 
TLT00775
Contributor
0
District Manager, Inside Sales
It’s broken down like this
>50% is .6 multiple
<50% is 1.4 multiple
<100% is 2.0
braintank
Politicker
2
Enterprise Account Executive
What does >50% refer to? Monthly quota attainment, annual attainment? 

What does multiple refer to? 
TLT00775
Contributor
0
District Manager, Inside Sales
Under 50% of annual quota. And the multiple refers to how much I get paid out on.
braintank
Politicker
2
Enterprise Account Executive
I'm still confused.

So if you're <50% of annual quota and you close a $10K deal how much do you get?
TLT00775
Contributor
0
District Manager, Inside Sales
10k I would see about 29%
braintank
Politicker
3
Enterprise Account Executive
So you'd get $2,900 on a $10K deal? Those seem like big payouts.

The standard for SaaS is AE makes 10% of the annual contract value ($1K in this example).
TLT00775
Contributor
1
District Manager, Inside Sales
Hey, JustGonnaSendIt breaks it down perfectly. I’m still figuring out everything when it comes to commission. Sorry for any confusion on my part.
braintank
Politicker
2
Enterprise Account Executive
No worries! But like @funcoupons said below -- 58K OTE is low for an AE. 
funcoupons
WR Officer
2
👑
15k a year? If it's annual and your base isn't enormous, that's some small ass potatoes.
TLT00775
Contributor
1
District Manager, Inside Sales
43k a year
braintank
Politicker
4
Enterprise Account Executive
So your breakdown is 43K base and 15K variable? 

If so, and you're based in NYC, how many roommates do you have ;)
TLT00775
Contributor
1
District Manager, Inside Sales
lol. I’m based an hour outside Philly. Would love the nyc pay tho haha
funcoupons
WR Officer
1
👑
If that breakdown is correct, time to look for a new sales role. SDRs make more than that lol
DungeonsNDemos
Big Shot
1
Rolling 20's all day
Tons of SMB (small business) Account Executive roles are going for 60K base and 120 OTE for many remote saas companies. 
Checkout Repvue if you havent yet to learn more about competitive salaries.
CuriousFox
WR Officer
2
🦊
Depends where you reside too.
TennisandSales
Politicker
1
Head Of Sales
yikes sounds a little low to me dawg. make sure you hit quota before jumping ship, it makes getting a better base way easier

IYNFYL
Politicker
0
Enterprise SaaS AE
It depends on the company but I’ve had as low as a 4% return on my sales and high as a 15% return. Many companies do the crap of $150K OTE with a 50/50 split, but then you find out that the average Rep doesn’t hit 100% until year 3

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