OTE and pay mix template: the short answer
OTE (on-target earnings) is a rep's total pay at 100% attainment: base salary plus variable pay. Pay mix is the split between the two, for example 70/30. The commission rate is variable pay at 100% divided by quota. Download our free Excel template and see for each role what a rep earns at 50 to 150% attainment, what the accelerator adds and what it costs the company.
Download the OTE and pay mix template (Excel, free)
The workbook has four sheets, ordinary formulas and no macros, so it works in Excel, Google Sheets, Numbers and LibreOffice. It has room for 8 roles and contains example numbers for four. The numbers are examples, not market data, and amounts are plain numbers in your currency (the example uses DKK). For pay levels in Denmark, see our sales salary guide.
OTE, pay mix and commission rate
OTE has a fixed and a variable part. Pay mix describes how much of OTE is fixed. The template calculates:
- Base salary = OTE × fixed share
- Variable pay at 100% = OTE − base salary
- Commission rate = variable pay at 100% ÷ annual quota
- Rate above quota = commission rate × accelerator factor
- Quota ÷ OTE = how many times OTE the rep must sell
- Cost to company = total pay × (1 + other pay costs)
With the rate set this way, the rep earns exactly the variable pay when quota is reached. How to choose the pay mix and the ratio between quota and OTE is covered in our guide to OTE and quotas. To check a single rep quickly, use the OTE ratio calculator.
How the template is built
| Sheet | What you do | What it shows |
|---|---|---|
| Instructions | Read | Step by step and how the workbook calculates |
| Roles | Enter headcount, OTE, fixed share, annual quota, accelerator factor and any cap per role | Base, variable pay, rate, rate above quota, quota ÷ OTE and cost at 100% |
| Payout | Pick five attainment levels | For each role: sales, commission with and without accelerator, total pay and cost |
| Summary | Nothing | The roles side by side and the whole team's sales pay at the five levels |
Worked example: four roles
Example: these are the template's example numbers, in DKK. Other pay costs are set to 10% of pay as an example covering pension, ATP, insurance and holiday pay. Use your own number. If your team sells from more than one Nordic country, see our comparison of sales salaries in Denmark, Sweden and Norway before you set OTE per country.
| Role | OTE | Pay mix | Base | Variable pay | Annual quota | Rate | Above quota |
|---|---|---|---|---|---|---|---|
| Inside sales | DKK 540,000 | 75/25 | DKK 405,000 | DKK 135,000 | DKK 2,700,000 | 5.0% | 7.5% |
| Account executive | DKK 720,000 | 60/40 | DKK 432,000 | DKK 288,000 | DKK 3,600,000 | 8.0% | 12.0% |
| Key account manager | DKK 840,000 | 70/30 | DKK 588,000 | DKK 252,000 | DKK 6,300,000 | 4.0% | 5.0% |
| Field sales | DKK 660,000 | 65/35 | DKK 429,000 | DKK 231,000 | DKK 3,300,000 | 7.0% | 10.5% |
For the account executive, the rate is 288,000 ÷ 3,600,000 = 8%, and with an accelerator factor of 1.5 the rate above quota is 12%. Quota is 5 times OTE. The key account manager has a quota of 7.5 times OTE, because the customers are larger, and a lower rate.
What does an account executive earn?
| Attainment | Sales | Commission | Total pay | % of OTE | Cost to company | % of sales |
|---|---|---|---|---|---|---|
| 50% | DKK 1,800,000 | DKK 144,000 | DKK 576,000 | 80% | DKK 633,600 | 35.2% |
| 75% | DKK 2,700,000 | DKK 216,000 | DKK 648,000 | 90% | DKK 712,800 | 26.4% |
| 100% | DKK 3,600,000 | DKK 288,000 | DKK 720,000 | 100% | DKK 792,000 | 22.0% |
| 125% | DKK 4,500,000 | DKK 396,000 | DKK 828,000 | 115% | DKK 910,800 | 20.2% |
| 150% | DKK 5,400,000 | DKK 504,000 | DKK 936,000 | 130% | DKK 1,029,600 | 19.1% |
At 150%, commission is 3,600,000 × 8% + 1,800,000 × 12% = 288,000 + 216,000 = DKK 504,000. With 40% variable pay, total pay swings from 80% of OTE at half attainment to 130% at 150%. With a 75/25 pay mix, inside sales only swings from 87.5% to 118.8%.
The accelerator effect
The template shows commission both with and without the accelerator. For the account executive, the difference is DKK 0 up to 100%, DKK 36,000 at 125% and DKK 72,000 at 150%. That is the price of rewarding overperformance, and it should be worked through before the plan goes out. Read more about accelerators and how to set the factor in our commission accelerators guide.
The key account manager has a cap of 150% of variable pay, i.e. DKK 378,000. At 125%, the accelerator gives DKK 330,750 against DKK 315,000 without. At 150%, both calculations hit the cap of DKK 378,000, so the accelerator adds nothing. A cap can cancel out the accelerator, which is worth knowing before you promise both.
The whole team
With 4 inside sales reps, 5 account executives, 2 key account managers and 3 field sales reps, the team's sales pay looks like this if everyone reaches the same attainment:
| 50% | 100% | 150% | |
|---|---|---|---|
| Sales | DKK 25,650,000 | DKK 51,300,000 | DKK 76,950,000 |
| Base | DKK 6,243,000 | DKK 6,243,000 | DKK 6,243,000 |
| Commission | DKK 1,588,500 | DKK 3,177,000 | DKK 5,433,750 |
| Cost to company | DKK 8,614,650 | DKK 10,362,000 | DKK 12,844,425 |
| Cost as % of sales | 33.6% | 20.2% | 16.7% |
Cost as a percentage of sales falls as attainment rises, because base pay is fixed. Commission as a percentage of sales, on the other hand, rises from 6.2% to 7.1% at 150% because of the accelerators. To check whether the team itself is the right size for your company, see our salespeople per employee data from 100 European B2B companies.
How to choose the pay mix
- More fixed pay suits roles with long sales cycles, large customers and a lot of teamwork, such as key account management.
- More variable pay suits roles where the rep controls the result and deals close quickly.
- Check the extremes: what does the rep earn at 50%, and what does it cost at 150%? Both numbers must be defensible.
- Use the same quota as the quota plan: the rate is only right if the quota is the one the rep actually gets. Use our sales quota planning template for the quotas.
Then write rates, accelerators and caps into the commission plan. You can find all our templates in the overview of free commission and sales compensation templates.
Common mistakes
- The rate is set without checking the quota, so the rep earns more or less than OTE at 100%.
- The accelerator applies to all sales instead of only sales above quota.
- Cost is only calculated at 100%.
- Cap and accelerator are set independently, so the cap removes the accelerator.
- Other pay costs are forgotten, so the budget is too low.
Prowi and OTE
Prowi calculates commission continuously from CRM data according to your rates, accelerators and caps, so reps can see their earnings and attainment in a mobile app. Statements are approved and passed on to payroll. Book a demo to see your own plan set up.
FAQ
What is OTE?
OTE stands for on-target earnings and is total pay at 100% attainment: base salary plus variable pay at 100%.
What does a 70/30 pay mix mean?
That 70% of OTE is fixed pay and 30% is variable pay at 100% attainment. With an OTE of DKK 600,000, base is DKK 420,000 and variable pay DKK 180,000.
How do you calculate the commission rate from OTE?
Divide variable pay at 100% by quota. With DKK 288,000 in variable pay and a quota of DKK 3,600,000, the rate is 8%.
What does a sales rep cost the company?
Base salary plus commission plus other pay costs such as pension, ATP, insurance and holiday pay. The template calculates it at five attainment levels and as a percentage of sales.
Is the OTE and pay mix template free, and does it work in Google Sheets?
Yes. The Excel file is free and uses only ordinary formulas without macros, so it works in Excel, Google Sheets, Numbers and LibreOffice.