Best Practice Report

Currency Exchange Rates: Quota And Compensation Crediting Implications

January 1st, 2018
Seth Marrs, Principal Analyst
Seth Marrs Principal Analyst

Summary

Currency fluctuations can distort sales performance if organizations don’t use fixed exchange (FX) rates. Sales must work with finance to set FX rates for sales planning, quota setting, and compensation crediting purposes. To reduce sales reps’ anxiety about a switch to FX rates, organizations must explain how setting and retiring quota using FX rates eliminates downside potential. In global B2B sales organizations, sales reps’ primary concern is avoiding being penalized or unduly rewarded for sales that involve currency fluctuations. In this report, we explain how sales organizations must account for currency exchange rates when setting sales plans and quotas and administering commission payouts.

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