Bonus Structure Examples for Sales and Revenue Teams

A bonus structure is the set of rules that decides who earns a bonus, what goal triggers it, how much it pays and when. The core formula is target bonus x achievement factor. Sales and revenue teams build on five designs: MBO, team pool, attainment-gated, kicker and retention. Each fits a different job.

We read the top five Google results for this search on October 25, 2026. They are written for HR in general: a policy template behind a member login, a 2016 accounting firm article with one attrition example, a vendor list of bonus types with no payout math, a construction industry piece and a glossary built on Indian bonus law. None of them works through a sales example. This guide gives the formula, then five designs a B2B SaaS revenue team actually uses, each with the math, an Excel formula and the way it breaks. It ends with what each design does to the comp expense forecast, because that is where finance feels a bonus plan.

What is a bonus structure?

A bonus structure is the written formula behind a bonus: who is eligible, what is measured, the target amount, the threshold and cap, and when it pays. If any of those is left vague, the bonus turns into a negotiation at payout time.

Every structure, from a company-wide annual bonus to a sales manager's quarterly plan, is built from the same parts:

• Eligibility. Which roles are on the plan, from what start date, and whether a person must still be employed on the payout date to be paid.
• Target bonus. The amount paid at 100% of goal, set as a percent of base salary or a fixed amount. For sales roles it is the bonus share of on-target earnings (OTE).
• Measures and weights. One to three goals, such as company ARR, team bookings or an individual objective, each with a weight that adds to 100%.
• Threshold, payout curve and cap. The level below which nothing pays, how fast the payout rises from there, and the most it can pay.
• Period and payout timing. Monthly, quarterly or annual, and how long after the period closes the money arrives.
• Discretion and forfeiture terms. What the company can change, and what happens on a leave, a transfer or a resignation.

A bonus differs from a commission in one way that matters for design: a commission is a rate on each sale, while a bonus is a set amount paid when a goal is met. The bonus vs commission entry covers that choice with a worked $88,000 example. This page assumes you have decided a bonus fits and need to pick its shape.

How do you calculate a bonus?

Multiply the target bonus by the achievement factor. When there are several goals, the achievement factor is the weighted average of each goal's result.

Bonus = base salary x target bonus % x achievement factor

Achievement factor = (weight 1 x result 1) + (weight 2 x result 2) + ...

Worked example (illustrative). A RevOps analyst earns $120,000 with a 10% target bonus, so the target is $12,000. The plan weights the company result at 60% and the individual result at 40%. The company finishes at 90% of its ARR plan, and the analyst's manager scores the individual goals at 110%.

• Achievement factor = 60% x 90% + 40% x 110% = 54% + 44% = 98%
• Bonus = $12,000 x 98% = $11,760

In Excel or Google Sheets, with salary in B1, target percent in B2, company result in B3 and individual result in B4:

=B1B2(0.6B3+0.4B4)

For a SaaS company, the company factor is often funded on the operating plan: ARR or new bookings against plan, often paired with an operating margin or burn target so the bonus pool is not paid out of a missed budget. That formula covers most non-sales employees. Sales and revenue roles need more specific shapes, because their goals are measured in bookings and land unevenly across a quarter.

Five bonus structure examples for sales and revenue teams

The five designs below cover almost every bonus a SaaS revenue team pays: MBO for objectives, team pool for shared results, attainment-gated for managers, kicker for deal attributes and retention for staying. All payouts in the table are illustrative, worked out in the sections that follow. The accounting column follows ASC 340-40: payments that exist only because a contract was signed are usually capitalized, while bonuses on profit, MBOs, ratings or continued employment are expensed. Plan wording decides the answer, so confirm each design with your auditors.

1. MBO bonus for objectives bookings cannot show

An MBO (management by objectives) bonus pays a set share of the target for each defined objective the person meets. It fits roles and periods where bookings are not yet a fair measure.

The clearest case is a new rep. Pete Furseth, ORM's COO, says: "In B2B SaaS and technology companies, we generally see that it takes 15 to 18 months for a rep to become fully productive." A commission plan pays a new rep very little in the first quarters, so an MBO pays for progress that comes before revenue.

Worked example (illustrative). A newly hired AE has a $6,000 quarterly MBO target in their first two quarters, with three objectives: Excel, with weights in B2:B4 and a 1 or 0 for met in D2:D4: =6000*SUMPRODUCT(B2:B4,D2:D4)

What breaks it: objectives that cannot be checked without argument, such as "shows leadership." Each one should have a number or a yes or no answer that a manager and the rep would score the same way. The MBO bonus entry covers where MBOs fit in a plan and why measurability decides whether they work.

2. Team pool bonus for people who share the deal

A team pool bonus funds one pool from the team's result and splits it among members, usually in proportion to each person's target bonus. It fits people who influence deals without owning them: sales engineers, solutions consultants, pods that sell as a unit, and customer success teams paid on retention. Worked example (illustrative). A solutions engineering team of five supports a region. Four engineers have a $10,000 quarterly target bonus and the team lead has $14,000, so the pool target is $54,000. The pool is funded at the region's bookings attainment, with nothing below 80% and a cap at 120%. The region books 90% of its quarter.

• Pool = $54,000 x 90% = $48,600
• Each engineer: $48,600 x ($10,000 / $54,000) = $9,000
• Team lead: $48,600 x ($14,000 / $54,000) = $12,600
• Check: 4 x $9,000 + $12,600 = $48,600

Excel, with attainment in B1 and the sum of targets in B2: =B2IF(B1<0.8,0,MIN(B1,1.2)). Each person's share: =Pooltarget/SUM(targets).

What breaks it: a pool that is too large a share of pay. When most of a person's variable pay depends on a number they barely move, the bonus stops changing behavior and becomes a lottery. Many teams keep the pool as the main measure and add one individual MBO, such as technical win rate or time to proof of concept, so each person still has something of their own.

3. Attainment-gated bonus for sales managers

An attainment-gated bonus pays nothing below a threshold of attainment, then a rising share of the target above it, up to a cap. It is the usual shape for front-line managers paid on their team's number. Worked example (illustrative). A sales manager has a $12,000 quarterly target. Below 75% team attainment the bonus pays $0. At 75% it pays 50% of target. The payout factor then rises 2 points for every point of attainment, reaching 100% at quota and 150% at 125%, where it caps. Excel, with attainment as a decimal in B1: =12000IF(B1<0.75,0,MIN(1.5,0.5+(B1-0.75)2))

Where to put the gate is the main decision, and it should come from your real attainment, not a round number. Pete's planning rule: "Maybe you want the average rep somewhere around 75% to 80% of quota, knowing you will have a tail below that and a tail above it." If team attainment tends to land in that band, a gate at 75% puts the cliff right where many managers finish, so one deal decides whether a manager gets $0 or $6,000. A lower gate with a smaller starting payout spreads the same cost over a smoother curve.

The cap needs the same care. Thomas Steenburgh of UVA Darden warns that "capping sales commissions just when star sales employees are on a roll encourages them to call it quits" (UVA Darden summary). A manager's bonus that stops at 125% has the same effect on a team that could reach 140%.

4. Kicker bonus for a deal attribute

A kicker is a standing bonus or multiple paid on deals with a specific attribute, such as a strategic product, a multi-year term or a new logo. It sits on top of the commission plan for as long as the company wants that behavior.

Pete puts it this way: "Where compensation becomes interesting is when the company wants to influence behavior. You might relieve quota or pay a multiple for selling a strategic product, for example." A kicker is that multiple, written into the plan instead of raising everyone's quota.

Worked example (illustrative). An AE earns 10% commission on new ACV. The plan has two kickers: commission on a new product line is paid at 1.25x for two quarters, and a flat $2,000 is paid on any contract with a committed term of three years or more. The AE closes a three-year deal with $120,000 of first-year ACV, of which $40,000 is the new product.

• Base commission: 10% x $120,000 = $12,000
• Product kicker: (1.25 - 1) x 10% x $40,000 = $1,000
• Term kicker: $2,000
• Total: $15,000, of which $3,000 is kicker

Excel, for the kicker amount only, with the rate in B1, the multiple in B2, product ACV in B3 and term in years in B4: =B1(B2-1)B3+IF(B4>=3,2000,0)

What breaks it: stacking. Three or more kickers on one plan make commission statements hard to check and pull attention from the main number. A kicker also differs from a SPIFF: a SPIFF is a short, dated contest, while a kicker is a standing rule. If a SPIFF has run for three quarters in a row, it is a kicker and belongs in the plan document. For short contests that rank reps against each other, see sales contest ideas.

5. Retention bonus for staying through a change

A retention bonus pays a fixed amount, usually in tranches, to a person who stays employed through a set date. Revenue teams use it around events that put key people at risk: an acquisition, a territory or comp plan redesign, or a leadership change. Worked example (illustrative). After an acquisition, a top enterprise AE on a $150,000 base is offered a retention bonus of 20% of base, $30,000, paid in two tranches: $15,000 at month 6 and $15,000 at month 12, each only if still employed. For the forecast, finance spreads the $30,000 at $2,500 a month across the stay period. If the AE resigns in month 8, they keep the first $15,000 and forfeit the second, and the amount accrued toward the second tranche comes back out of the forecast.

What breaks it: paying people who were going to stay anyway, and leaving out the people who were not. Base the list on who carries pipeline, accounts or knowledge the business cannot replace inside a quarter, and check it against the ramp data. With a 15 to 18 month ramp to full productivity, replacing a tenured enterprise seller means more than a year of reduced capacity in that territory. That is the cost to compare with the bonus.

Federal rules count this bonus as pay. Under 29 CFR 778.211(c), bonuses announced to induce employees "to remain with the firm are regarded as part of the regular rate of pay," so for overtime-eligible staff they feed into overtime pay. Repayment clauses for a bonus paid up front are treated differently from state to state, so have counsel review any clawback.

Which bonus structure fits which role?

Match the design to what the role controls. A person should be paid on a result they can see and move within the bonus period. Most quota-carrying plans keep commission as the main signal. In Bridge Group's 2024 survey, the median SaaS account executive had "$190K with a 53:47 base : variable split" (Bridge Group, 2024), and that variable share is mostly commission. Bonuses fill the gaps around it. The average sales commission guide turns that pay mix into a commission rate, and the incentive pay entry shows how to budget bonuses, commission and SPIFFs together.

How often should bonuses be paid?

Pay sales bonuses quarterly when pacing matters, and keep annual bonuses for company-wide goals. Short periods keep the goal close for people who need it.

In research by Thomas Steenburgh and Michael Ahearne, when a company replaced quarterly bonuses with annual ones, that revenue from the weakest performers showed "a dip by approximately 10 percent" (UVA Darden summary). A quarterly gate gives a rep who falls behind a fresh start, while an annual gate can be out of reach by the third quarter.

The trade is noise. SaaS bookings land unevenly within a year. Pete notes that across ORM's customer base, "Q1 is frequently the slowest selling quarter," with sales kickoff, plan changes and territory moves eating selling time. A quarter like that can put good managers below the gate for reasons outside their control. Some plans pay quarterly and add an annual true-up, so a strong year that started slowly is not penalized twice.

How does a bonus structure change the comp expense forecast?

A commission accrues in a straight line with bookings. A gated bonus jumps at each threshold, so the forecast has to estimate which side of each line every person lands on. That makes bonus expense harder to forecast than commission, and it is the part of a bonus plan finance should test before approving it. Worked example (illustrative). Six sales managers are on the gated plan above, each with a $12,000 quarterly target, so $72,000 at 100%. With two weeks left, the bookings forecast puts their teams here: Now move two deals. If manager 1's team closes one more deal and reaches 75%, the accrual rises $6,000. If manager 2's team loses a deal and falls to 74%, it drops $6,240. The range between the best case (manager 1 crosses, manager 2 holds) and the worst case (manager 1 misses, manager 2 falls) is $12,240, about a quarter of the $49,680 accrual, and it turns on two deals near two gates. A blended team forecast cannot show that. Only a deal-level forecast, rolled up to each manager's team, can tell you who crosses the line.

Three points for finance and RevOps:

• Forecast each person, not the average. The cost of a gated or pooled bonus depends on the distribution of attainment. ORM's guide to forecasting commission expense sets out the rep-by-rep method, and it matters even more for bonuses.
• Separate expensed from capitalized. MBO, pool, gated and retention bonuses hit the current period. Kickers paid only for a signed contract are usually capitalized and amortized. Moving variable pay from commission into bonuses moves expense forward.
• Model the plan at real attainment. Run each design at the attainment your teams produced last year by role and region, not at 100%. A plan that looks cheap at quota can be expensive, or demotivating, at the attainment you actually get.

What should a bonus plan document say?

Write the formula, the measures, the gate and cap, the payout date, the eligibility rules and what the company may change, and have each participant acknowledge it. A bonus people cannot calculate themselves is a bonus they will dispute.

• Discretionary or not. The US Department of Labor treats a bonus as discretionary only if the employer alone decides whether to pay and how much until near the end of the period, and the payment is not made under a prior promise. "Nondiscretionary bonuses are included in the regular rate of pay" for overtime (DOL Fact Sheet 56C). Every design on this page, written into a plan in advance, is nondiscretionary.
• Taxes. The IRS treats bonuses as supplemental wages, and payroll often withholds a flat 22% federal rate on them (IRS Publication 15).
• Leavers and transfers. State whether a person must be employed on the payout date, how a mid-period start or transfer is prorated, and what happens on a leave of absence.
• Changes. State when the company can change measures or targets mid-period and how participants are told.

This section is general information, not legal advice. Check plan wording with employment counsel for each state where your people work.

ORM's take

Choosing a bonus structure is a forecasting decision as much as a pay decision. Gates, pools and kickers make comp expense depend on where each person and team lands, so the plan is only as good as the bookings forecast underneath it. ORM forecasts bookings deal by deal, targeting 95% accuracy, and models capacity and ramp by position and region, which gives finance and RevOps the per-team view a bonus plan needs. See how ORM works for CFOs and finance teams, or schedule a demo.