From here you can see over the horizon.  You have a pretty good idea if you’re going to make the number.  It might not look promising.  About 75% of U.S.-based corporations operate on a calendar fiscal year.  Now is the time to plan for next year.  Do you have the right number of reps? Proper headcount is critical to making your number.


Here’s how most companies (incorrectly) figure this out: 


The CEO hands a projected revenue number to you (the senior sales leader).  You both know for cost reasons what the quota per salesperson needs to be.  So you simply divide the revenue number by the average quota number.  This produces a headcount number.  Then you take the headcount number and multiply it by the cost per rep.  You use the “all-in” cost-base, commissions, overhead.  This yields a cost of sale typically expressed as a percentage of revenue.  This simple analysis is the most common way of headcount planning in corporate America.


Here are the implications of this too-generic approach. Below is a quota distribution chart. On the left side vertical axis is the number of reps.  On the right side vertical axis are quota numbers expressed as dollars. The red bars from <10% – 99% are the number of sales reps for each range.  For example, five sales reps attained between 40 and 49% of the quota.  The green bars indicate numbers of reps who exceeded quota.


quota attained distribution


This distribution would drive anybody crazy – especially your CFO.  The CFO sees this and walks in your office.  He says, “Hey, Vick, you should whack your bottom 10 reps.  They cost a fortune and aren’t performing.  We can save the money.”  But you know if you don’t have enough reps, you’ll miss the number.


What’s a better way to do this?  I’ll give you two: a top-down approach and a bottoms-up approach.  The combination of these two will keep your CFO out of your office.


Top-down: Calculate the territory market potential


This method works best if you employ Hunter sales reps (who hunt new logos).  First, using your Ideal Customer Profile, identify the number of opportunities in your market.  Then calculate the potential revenue from the market.  Do this by looking at the current spend of customers who resemble the ideal opportunities you’ve identified.   This allows you to see the total potential of your market.  You can also see the potential of each existing territory.  If you haven’t done this before you’ll be surprised.  The potential will vary dramatically by rep territory.  This is a common cause of unequal rep quota attainment.


This Workload Analysis Calculator will help you run a Workload Analysis.



Use this tool to figure out how many sales reps you need and to achieve a balanced quota.


Download the tool here.


Bottoms-up: The Workload Analysis approach


This method works best if you employ Farmer sales reps (who develop existing accounts).  Start with your total number of existing target accounts.  Have you mapped your ideal customer’s Buying Journey?  If so, you know how often they want to be called on.  Multiply this call frequency by the number of accounts.  When you multiply these two numbers you get an annual call volume.  This is the total number of rep appointments per year.


Let’s apply some math to this. Assume you have 2,000 target customers.  You want to call on each one of those accounts once a month.  That’s 12 x 2000 = 24,000 calls.


Now calculate rep capacity.  Based on your experience, how many appointments can your reps handle in a week?  Let’s say it’s 8.  Multiply that by the number of working weeks in a year (typically 47).  47 x 8 = 376 appointments in a year.


24,000 annual calls divided by 376 calls per rep equals about 64 reps.  This is an example of a workload analysis, or bottoms-up approach.


When you use these two methods you get a quota distribution curve like this:


quota distribution curve


This kind of a standard distribution makes CFOs very happy.  You’ve staffed your organization properly to enable you to make the number.  You’ll produce balanced quota attainment, which is typically in the 60-75% range.  Put another way, 38-48 of your 64 reps (60-75%) should make the number.


The Workload Analysis Calculator today can help you start running a Workload Analysis today.


Download the tool here.


You can also check out other ways to further enable your sales team by downloading SBI’s 2020 How to Make Your Number Workbook, exploring our Sales Strategy insights, or by connecting with an expert.



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Josh Horstmann

Brings a deep level of experience and insight in helping organizations develop and execute their corporate, sales and marketing strategies.

Josh specializes in helping clients solve demanding sales and marketing challenges through aligning functional strategies within an organization. He has worked with clients in manufacturing, ecommerce, software, financial services and technology sectors.


Recently he helped transform an international services company ‘go to market’ strategy, which included assessing talent, re-organizing the sales force, increasing team productivity, reducing the cost of sale and aligning the marketing and sales strategies.


Josh continues to provide thought leadership to his clients advising them on how to build inside sales teams, develop compensation programs, share best practices on social selling, transform sales organizations, drive demand generation programs and acquire and cultivate talent. Along with this he helps organizations align functional strategies.


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