What is a Sales Decelerator?

Palette Team

In sales commissions, a decelerator, also known as a de-accelerator or sliding scale, is a mechanism that reduces the commission rate for sales representatives as they fail to meet certain performance criteria or sales targets.

A decelerator is often used as a means to incentivize sales representatives to meet or exceed their sales goals consistently. It introduces a progressive reduction in commission rates as performance falls below predetermined thresholds. The intention behind a decelerator is to encourage salespeople to maintain consistent performance and discourage complacency or underperformance.

Here's a simplified example to illustrate how a decelerator works:

Let's say a sales representative has a base commission rate of 7% on sales revenue. However, the commission plan includes a decelerator that triggers when the rep falls below a specific threshold—for example, when they achieve less than 80% of their quota. The decelerator may decrease the commission rate to 5% for all sales revenue achieved below the threshold.

Here's how it could work:

- If the sales representative achieves 100% or more of their quota, they earn a commission at the base rate of 7%.

- If the sales representative falls below the threshold and achieves 70% of their quota, they earn a commission at the reduced rate of 5% for the entire sales revenue.

- If the sales representative falls further and achieves 50% of their quota, they still earn a commission at the reduced rate of 5% for the entire sales revenue.

By incorporating a decelerator into the commission structure, organizations aim to create a sense of urgency and accountability for sales representatives. It encourages consistent effort, discourages slumps in performance, and aligns sales goals with compensation. The decelerator can serve as a mechanism to address underperformance and incentivize sales representatives to strive for better results.

Subscribe to our updates

Latest news, best practices, and industry insights - stay up-to-date on everything you need to know about sales compensation!

Sign up for our newsletter, we promise not to spam you.
Thank you! Your submission has been received!
Oops! Something went wrong while submitting the form.

Why Palette?

Automate calculations

Automate sales commission payments. Create commission rules, define a payout schedule and access monthly statements for each sales rep.

Motivate and coach with real time dashboards

Motivate sales professionals with real-time visibility into commissions. Coach your team, align everybody with company goals and drive long term sales performance.

Compare, simulate and design commission plans

Roll out new commission plans with ease. Compare plans and simulate new rules with a single click.

No more errors

Palette keeps history logs and tracks every calculation detail, helping you to reduce sales commission errors.

Reconcile revenue with CRM data

With Palette you can reconcile invoices and payments with CRM data and pay commissions to your reps only when the money is in the bank.

Create challenges with one click

Incentivize your teams on short term goals. Create a challenge targeting any KPI you want to uplift, drive better results and boost your company’s culture.