Sales Goal Setting
Working Backwards to Hit Your Goal Is the Key
There is a formula, and it runs backwards. You start with the income you want, then work down through your funnel to the calls a rep has to make today. If you set next quarter's number by gut feel, you're guessing. Here's how to stop.
Five moves take you from the income you want to the number of calls a rep makes tomorrow morning. Run them in order.
Start with what you want to earn, not with what you think you can do. Pick the commission or revenue target for the period. Write it in pencil, because you may have to erase it. This is the top of the math, and everything else flows down from it. Then get emotional about it. Picture what hitting it actually buys you, a new truck, a paid-off card, a real vacation with your family. See it and believe it. If the number doesn't mean something to you, you won't do the work that sits behind it.
Now back into the sales your target represents. At a 10% commission, $20,000 in commission means $200,000 in sales. Divide that by your average deal size. At $20,000 a deal, that's 10 closed deals. The abstract dollar goal just became a countable number of wins. If you don't know your average deal size and your commission rate cold, that's the first gap to close, because the rest of the formula depends on both.
Deals come from opportunities, opportunities come from good prospects, and prospects come from activity. Run your own conversion rates backwards. If 15 opportunities produce 10 closed deals, and 26 good prospects produce those 15 opportunities, and it takes 525 calls to surface 26 prospects, then your month is 525 calls. That's 25 calls a day across 21 selling days. The goal just turned into a to-do list a rep can pick up every morning.
Now check whether a human can actually do it. If the funnel says a rep needs 2,000 calls a month, or 40 demos a week, and there aren't enough hours in the day, the goal isn't aggressive. It's fiction. You have two honest moves. Lower the goal to what the activity can support, or raise the payout per deal by selling a bigger product or a better-fit customer. Pretending the number is real doesn't make it real. It just guarantees the miss and burns out the rep on the way.
This is where a sales leader earns the title. One rep working backwards is a good habit. A whole team running the same formula on the same product is a revenue engine you can forecast. Build the funnel math once, write it into the Accountabilities Document, and have every rep run their own numbers off it. Then your goal, the leader's goal, is simply the sum of theirs measured against your comp plan. When each rep's math is honest, the team forecast is honest too.
Read it top to bottom the way you build it, from the paycheck you want down to the calls that pay for it. Assume a 90-day cycle, a 10% commission, and a $20,000 average deal.
These numbers only illustrate the method. Yours will move with your product, your pricing, how you define an opportunity, and how your funnel converts. Run the formula with your own rates, not mine.
Most founders and sales leaders set next year's number the same way. They take last year and add a percentage. That isn't a goal, it's a hope with a decimal point on it. A real sales goal runs the other direction. You start with the income you want, translate it into sales, then into deals, then into the prospects and calls that produce those deals. By the time you're finished, the goal isn't a slogan on a whiteboard. It's a daily activity count every rep can see and hit.
The formula only works if you know your own conversion rates, so the first job is measuring them honestly. If you're still figuring out where to start, how to prepare when setting sales goals → walks through the inputs you need before you ever touch the math. And once the numbers are set, how to set quota for a small sales team → shows how to turn them into targets a team will actually own. The formula is the easy part. The discipline to run it every quarter is what separates the teams that hit from the teams that explain.
Same target, two completely different odds of hitting it. The difference isn't effort. It's whether the number is connected to the math underneath it.
I'm Louie Bernstein. I have 50 years in business experience, including 22 as a bootstrapped founder. My Fractional Sales Leadership business has been helping founders since 2017.
I teach this backwards formula to every team I work with, because a goal nobody can trace back to a daily number is just pressure. When each rep knows exactly how many calls stand between them and their commission, and the leader's number is the honest sum of the team's, the whole company stops guessing and starts forecasting.
There's a real formula, and it's the opposite of guessing. You start with the commission or revenue you want, convert it into the number of deals that produces, then work up your funnel to the opportunities, prospects, and calls behind those deals. The output is a daily activity number. Guessing gives you a slogan. The formula gives you a to-do list.
Then the goal is wrong, not the rep. If the math says someone needs 2,000 calls a month and there aren't enough hours to make them, you have two honest choices. Lower the goal to what the activity can realistically support, or raise the payout per deal by selling a bigger product or a better-fit customer. What you can't do is leave an impossible number on the board and hope. That only guarantees the miss.
Plan as far ahead as your sales cycle is long. If it takes a customer 90 days to buy, then the activity you set today pays off a full quarter from now, so you have to be working the formula a quarter ahead of the number you want. Shorter cycle, shorter runway. Longer cycle, you plan further out. The only thing that changes is the lead time.
Yes, if they're selling the same product. It's more efficient for you, and it makes the whole team predictable. When everyone runs the same funnel math off the same conversion rates, your forecast is just the sum of their numbers, and you can see a problem in any one rep's activity long before it shows up in the revenue. Different products can have different formulas, but reps on the same product should share one.
Four inputs: your commission rate, your average deal size, and your conversion rates from prospect to opportunity and opportunity to close. If you don't know those cold, that's the real work before goal-setting. Measure them from your last few quarters of actual deals. The formula is only as honest as the rates you feed it, so it's worth getting them right before you build a single target on top of them.
In 30 minutes I'll walk your target backwards through your own funnel, show you the daily activity it actually requires, and tell you honestly whether the number is real or needs adjusting. No slides, just the math.