Answers:
Known as sales target, sales quota is an expression of sales value and sales volume expected from a salesperson to be achieved in full from their defined territory over a given period of time i.e., weekly, monthly, quarterly or yearly. In simple sense, a sales quota is a goal; it is a target a sales staff is expected to meet. Each sales person must understand the importance of their target and how it fits in as part of the pre-set goals stated in business plan of an enterprise. They are a way of life for the sales force. All activities of the sales force revolve around fulfillment of sales quotas. As already mentioned, sales quotas are the targets assigned to sales personnel, they also signify the performance expected from them by an organisation. Sales quotas help directing, evaluating and controlling the sales force. They forman indispensable tool for sales managers to carry out sales management activities. Sales quotas are prepared on the basis of sales forecasts and budgets. They provide targets for sales personnel to achieve, act as standards to measure sales force performance and help motivate the salesforce. Compensation plans are invariably linked to quotas. The commission and bonuses given to sales persons are also based on their meeting the quotas set for them.