Page 70 - CPBT

Examples of sales compensation tactics

“We pay our sales reps on gross margin only. And we pay on their total book of business.
The smart ones have figured out that going into each month they have a portion of their
quota already met from their recurring revenue business. This somewhat allows them to
balance the need to sell a big deal with the need to build a sustaining backlog of recurring
revenue. BUT…This may not have worked if our sales team was more transient in nature.
– Cisco Cloud Reseller with sales reps that have significant tenure at the company

We pay our reps on the total contract value upfront. We have enough cash flow

”from our organization to cover the sales compensation even though the customers
“have not paid us yet. Our account managers sell our complete portfolio so this

helps with potential compensation issues compared to larger upfront deals. But our
reps do not get paid for renewals. We have a dedicated team that handles that.
– Larger (>$100M in annual revenue) Cisco Cloud Reseller

We put an overlay sales force in place to address the issue of having

”mostly hardware based sales reps. This will cost more in the beginning,

but it is a variable cost on a small portion of our overall revenue right now.

“– Cisco Partner in the process of implementing XaaS solutions,
”but 80+% of revenue is still from product resale