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Revenue Quota Compensation Examples

The Revenue Quota compensation examples comprise the following syntax:

<Payment Type>:<Apply Txn>:<Split On/Off>:<ITD On/Off>

The following examples use Revenue Quota compensation to calculate transactions:

The Sales Activity table lists the transaction amount, the product sold, and the performance that is being used to calculate the commission for each of these methods. Quota is defined to be $1,000 in the two examples. Revenue classes A and B are tied to these plan elements.

Sales Activity
Transaction Amount Product Performance % (Achievement/Quota)
$500 A $500/$1,000 = 50%
$500 B $1,000/$1,000 = 100%

The RQ Percentage Rate Table is used to calculate the commission rate for the following payment types:

RQ Percentage Rate Table
Tier Commission
Percent Percent
From % To % %
0 75 5
75 100 10
100 999 15

The RQ Amount Rate Table is used to calculate the commission amount for the fixed amount payment type.

RQ Amount Rate Table
Tier Commission
Percent  
From % To % Amount
0 75 5.00
75 100 10.00
100 999 15.00

Applied Transaction Amount Percentage : Individually : Split On : ITD Off

This type of plan element is typically used to compensate internal sales representatives on revenue. The sales representatives receive a percentage of the revenue that they earn for the company. This percentage or rate amount is determined by their overall revenue achievement towards the quota set by sales management.

When this type of plan element is used with the Split check box checked, the sales representatives who earn the same total revenue will receive the same total commission irrespective of the number of sales that they make.

Revenue Quota Plan Element Example 1
Active Periods JAN-97 to DEC-97
Interval Type Quarter
Split On
Apply Txn Individually
Quota $1,000.00
Payment Type Applied Transaction Amount Percentage
Rate Table RQ Percentage
Discount Option None
ITD Off

This plan element calculates the commission for each transaction and allows the commission to be paid each period. Revenue accumulating is reset at the beginning of each interval. Oracle Sales Compensation adds the transaction amount to the revenue already associated for the interval, finds the appropriate tier in the RQ Percentage Rate Table associated with this level of achievement to determine the corresponding commission rate, and multiplies this rate by the transaction amount to derive the commission.

Calculation Formula
Commission rate Determined by the tier in which the revenue performance percentage is located in the RQ Percentage Rate Table.
Commission Commission rate x transaction amount.

   To calculate the commission for product A:

   To calculate the commission for product B:

In this case, the second $500 transaction crosses over both the first and second tiers in the RQ Percentage Rate Table.; therefore, the revenue will be split across both tiers, and two different rates will be used to calculate the commission.

   To calculate the commission for products A and B:

Calculate the commission for products A and B.

The total commission for products A and B for the quarter is: $25.00 + $37.50 = $62.50.

Applied Transaction Amount Percentage : Individually : Split Off : ITD Off

This type of plan element is typically used to compensate internal sales representatives on revenue. The sales representatives receive a percentage of the revenue that they earn for the company. This percentage or rate amount is determined by their overall revenue achievement towards the quota set by sales management.

When this type of plan element is used with the Split check box unchecked, the sales representatives who earn the same total revenue may not receive the same total commission. If a transaction spans more than one tier, the transaction will not be split proportionately across the different tiers, instead only the higher rate will be used to calculate the entire transaction. Companies may use this feature to provide an added incentive to make larger sales to each customer.

Revenue Quota Plan Element Example 2
Active Periods JAN-97 to DEC-97
Interval Type Quarter
Split Off
Apply Txn Individually
Quota $1,000.00
Payment Type Applied Transaction Amount Percentage
Rate Table RQ Percentage
Discount Option None
ITD Off

This plan element calculates the commission for each transaction and allows the commission to be paid each period. Revenue accumulating is reset at the beginning of each interval. Oracle Sales Compensation adds the transaction amount to the revenue already associated for the interval, finds the appropriate tier in the RQ Percentage Rate Table associated with this level of achievement to determine the corresponding commission rate, and multiplies this rate by the transaction amount to derive the commission.

Calculation Formula
Commission rate Determined by the tier in which the revenue performance percentage is located in the RQ Percentage Rate Table.
Commission Commission rate x transaction amount.

   To calculate the commission for product A:

   To calculate the commission for product B:

Note: When the performance is on the border of two tiers, Oracle Sales Compensation uses the higher rate to calculate the commission rate for plan elements where the Split check box is unchecked or not applicable.

   To calculate the commission for products A and B:

Calculate the commission for products A and B.

The total commission for products A and B for the quarter is: $25.00 + $75.00 = $100.00.

Fixed Amount : Individually

This type of plan element is typically used to compensate sales representatives on revenue and provide them with a fixed commission amount that depends on their level of achievement towards revenue goals or quota. It is important to note that when this type of plan element is used, sales commission is affected not only by the revenue attained, but also by the number of sales made. The revenue attained determines the rate (or commission amount), which will be paid for each sales transaction. This is useful in creating incentives for sales representatives to sell products to a larger number of customers while still attaining revenue goal quotas.

Revenue Quota Plan Element Example 3
Active Periods JAN-97 to DEC-97
Interval Type Quarter
Apply Txn Individually
Quota $1,000.00
Payment Type Fixed Amount
Rate Table RQ Amount
Discount Option None

This plan element calculates the commission for each transaction and allows the commission to be paid each interval. Revenue accumulation is reset at the beginning of each interval. Oracle Sales Compensation adds the transaction amount to the revenue accumulated interval to date, finds the appropriate tier in the RQ Amount Rate Table associated with this level of achievement to derive the corresponding commission amount.

Calculation Formula
Commission rate Determined by the tier in which the revenue performance percentage is located in the RQ Amount Rate Table.
Commission Commission amount.

   To calculate the commission for product A:

   To calculate the commission for product B:

Note: When the performance is on the border of two tiers, Oracle Sales Compensation uses the higher rate to calculate the commission amount for plan elements where the Split check box is unchecked or not applicable.

   To calculate the commission for products A and B:

Calculate the commission for products A and B.

The total commission for products A and B for the quarter is: $5 + $15 = $20.

Payment Amount Percentage : Individually : ITD Off

This type of plan element is typically used to compensate sales representatives on revenue and provide them with a commission that is a percentage of payment or incentive quota. The rate is determined by the sales representatives' percentage achievement towards revenue goals.

Companies may use payment quotas to more closely budget the cost of all sales. Although the rate is determined by the revenue achievement towards quota, the actual commission earned will be the percentage of payment quota.

Plan elements with the Apply Txn field set to Individually and the Payment Type field set to Payment Amount percentage, will result in sales representatives receiving higher commissions for larger number of sales than lower number of sales with the same overall revenue attainment.

Revenue Quota Plan Element Example 4
Active Periods JAN-97 to DEC-97
Interval Type Quarter
Apply Txn Individually
Quota $1,000.00
Payment Type Payment Amount Percentage
Payment $750.00
Rate Table RQ Percentage
Discount Option None
ITD Off

This plan element calculates the commission for each transaction and allows the commission to be paid each period. Revenue accumulating is reset at the beginning of each interval. Oracle Sales Compensation adds the transaction amount to the revenue already associated for the interval, finds the appropriate tier in the RQ Percentage Rate Table associated with this level of achievement to determine the corresponding commission rate, and multiplies this rate by the payment amount to derive the commission.

Calculation Formula
Commission rate Determined by the tier in which the revenue performance percentage is located in the RQ Percentage Rate Table.
Commission Commission rate x payment.

   To calculate the commission for product A:

   To calculate the commission for product B:

Note: When the performance is on the border of two tiers, Oracle Sales Compensation uses the higher rate to calculate the commission for plan elements where the Split check box is unchecked or not applicable.

   To calculate the commission for products A and B:

Calculate the commission for products A and B.

The total commission for products A and B for the quarter is: $37.50 + $112.50 = $150.00.

Applied Transaction Amount Percentage : Grouped by Interval

This type of plan element is typically used to provide bonuses to sales representatives based on revenue. The sales representatives receive a percentage of the revenue that they earn for the company. This percentage or rate amount is determined by their overall revenue achievement towards the quota set by sales management.

Revenue Quota Plan Element Example 5
Active Periods JAN-97 to DEC-97
Interval Type Quarter
Apply Txn Grouped By Interval
Quota $1,000.00
Payment Type Applied Transaction Amount Percentage
Rate Table RQ Percentage

This plan element pays once per quarter. Revenue achievement is reset at the beginning of each interval. Oracle Sales Compensation totals the revenue for all sales transactions during each quarter, finds the appropriate tier in the RQ Percentage Rate Table associated with this level of achievement to determine the corresponding commission rate, and multiplies this rate by the total transaction amount to derive the commission.

Calculation Formula
Commission rate Determined by the tier in which the revenue performance percentage is located in the RQ Amount Rate Table.
Commission Commission rate x total transaction amount.

   To calculate the commission for products A and B:

Note: When the performance is on the border of two tiers, Oracle Sales Compensation uses the highest rate to calculate the compensation for plan elements with the Apply Txn field set to Grouped by Interval, or for plan elements where the Split check box is unchecked or is not applicable.

Fixed Amount : Grouped By Interval

This type of plan element is typically used to compensate sales representatives on revenue and provide them with a fixed commission amount, which depends on their level of achievement towards revenue quota or goal.

Revenue Quota Plan Element Example 6
Active Periods JAN-97 to DEC-97
Interval Type Quarter
Apply Txn Grouped By Interval
Quota $1,000.00
Payment Type Fixed Amount
Rate Table RQ Amount
Discount Option None

This plan element pays once per quarter. Revenue achievement is reset at the beginning of each interval. Oracle Sales Compensation totals the revenue for all sales transactions during each quarter, finds the appropriate tier in the RQ Amount Rate Table associated with this level of achievement, and pays the corresponding compensation amount defined for that tier.

Calculation Formula
Commission rate Determined by the tier in which the revenue performance percentage is located in the RQ Amount Rate Table.
Commission Commission amount.

   To calculate the commission for products A and B:

Note: When the performance is on the border of two tiers, Oracle Sales Compensation uses the highest rate to calculate the compensation for plan elements with the Apply Txn field set to Grouped by Interval, or for plan elements where the Split check box is unchecked or is not applicable.

Payment Amount Percentage : Grouped By Interval

This type of plan element is typically used to compensate sales representatives on revenue and provides them with a commission that is a percentage of payment or incentive quota. The rate is determined by the sales representatives' percentage achievement towards revenue.

Companies may use payment quotas to more closely budget the cost of sales. Although the rate is determined by the revenue achievement towards quota, the actual commission earned will be a percentage of the payment quota.

Revenue Quota Plan Element Example 7
Active Periods JAN-97 to DEC-97
Interval Type Quarter
Apply Txn Grouped By Interval
Quota $1,000.00
Payment Type Payment Amount Percentage
Payment $750.00
Rate Table RQ Percentage
Discount Option None

This plan element pays once per quarter. Revenue achievement is reset at the beginning of each interval. Oracle Sales Compensation totals the revenue for all sales transactions during each quarter, finds the appropriate tier in the RQ Percentage Rate Table with the associated level of achievement to determine the corresponding commission rate, and multiplies this rate by the payment amount to derive the commission.

Calculation Formula
Commission rate Determined by the tier in which the revenue performance percentage is located in the RQ Percentage Rate Table.
Commission Commission rate x payment amount.

   To calculate the commission for products A and B:

Note: When the performance is on the border of two tiers, Oracle Sales Compensation uses the highest rate to calculate the compensation for plan elements with the Apply Txn field set to Grouped by Interval, or for plan elements where the Split check box is unchecked or is not applicable.

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