Insight
Feb 14 2026
When I talk with CFOs about commission planning, I often get the same question: "Why do our enterprise and SMB reps need different commission structures?"
The answer is simple but profound—they're playing entirely different games, and the compensation needs to reflect that reality.
As someone who works with finance leaders every day, I've seen how the wrong commission structure can quietly drain ROI while creating frustration across the sales team. Let's break down exactly how enterprise and SMB commission plans should differ, with real examples you can adapt for your organization.
The fundamental difference boils down to sales cycle, deal size, and complexity. An SMB sales rep might close 10-15 deals per month at $1,000-$20,000 annual contract value (ACV), cycling through prospects in 2-14 days. Meanwhile, an enterprise Account Executive spends 6-18 months nurturing a single $300,000+ deal through multiple stakeholders, legal reviews, and security audits.
These divergent realities demand fundamentally different incentive structures. Pay an enterprise rep like an SMB rep, and they'll burn out chasing volume that doesn't exist in their market. Pay an SMB rep like an enterprise rep, and they'll lack the urgency to close high-velocity deals.
The ROI implications are significant. Companies spend over 40% of their sales budget on commissions, according to sales compensation data, yet many CFOs struggle to assess whether their incentive structure is actually driving the right behaviors and revenue outcomes.
SMB commission plans prioritize volume, velocity, and simplicity. Here's what works:
The most common SMB structure features a balanced base-to-variable split with straightforward commission rates:
Example:
Sample Calculation:If a rep closes 10 deals averaging $10,000 ACV in Q1:
This structure works because it provides income stability while rewarding high activity. SMB reps can predict earnings and stay motivated through shorter sales cycles.
For organizations prioritizing aggressive growth, tiered structures incentivize reps to exceed quota:
Example:
Sample Calculation:Quarterly quota of $100,000:
This structure drives urgency in the final weeks of each quarter and rewards top performers disproportionately—exactly what you want in a high-volume environment.
Modern sales compensation management platforms can automate these tier calculations, eliminating the spreadsheet gymnastics that traditionally consume RevOps hours each month.
Enterprise structures emphasize patience, strategic selling, and long-term relationship building. Commission rates are lower in percentage terms but massive in absolute dollars.
Example:
Sample Calculation:If a rep closes three deals totaling $900,000:
With Accelerators:
If the rep hits $3M (120% of quota):
This approach recognizes that enterprise deals require sustained effort over many months. The accelerator structure rewards overperformance significantly—critical for retaining top talent in complex sales environments.
For new enterprise reps or those in extended ramp periods, a recoverable draw provides financial stability:
Example:
Sample Scenario:
This structure acknowledges the reality of long sales cycles while ensuring reps can pay their mortgages during the ramp period.
Feature
SMB Commission Structure
Enterprise Commission Structure
Sales Cycle
2 days – 4 months
6-18+ months
Deal Size
$1,000-$20,000 ACV
$50,000-$1M+ ACV
Commission %
10-20%
5-10%
Base/Variable Split
50/50 or 60/40
50/50 or 60/40
OTE Range
$100,000-$150,000
$250,000-$500,000+
Primary Driver
Volume and velocity
Strategic value and relationships
Accelerators
Start at 100% quota
Start at 100-120% quota
Typical Quota
$300,000-$500,000 annually
$2M-$5M+ annually
From a finance standpoint, commission structure design directly impacts your P&L predictability and compliance posture. Here's what matters:
Cost of Sales Ratio: SMB models typically run 15-25% of revenue in total compensation costs, while enterprise models run 10-18% due to larger deal sizes. Understanding these benchmarks helps you budget accurately and identify outliers.
Revenue Recognition Timing: Multi-year enterprise deals create accounting complexity. Commission calculation automation ensures your commission expenses align with recognized revenue, crucial for ASC 606 compliance.
Transparency and Auditability: Complex commission structures—especially tiered and accelerated plans—require robust documentation. Sales comp platforms that provide audit trails and automated calculation explanations reduce disputes and support compliance requirements.
Plan Flexibility: Market conditions change rapidly. Your commission infrastructure should allow you to adjust quotas and incentives quickly without rebuilding spreadsheets or waiting for IT resources.
Some organizations serve both SMB and enterprise markets with the same sales team. In these scenarios, consider a blended approach:
Example Hybrid Structure:
This structure encourages reps to pursue the highest-value opportunities while still rewarding smaller deals that close quickly and build pipeline momentum.
The commission structures I've outlined work beautifully—in theory. In practice, most finance and RevOps teams spend countless hours each month manually calculating commissions, resolving disputes, and trying to generate insights from fragmented data.
Modern sales performance management platforms have transformed this landscape. Solutions like EasyComp automate complex commission calculations, integrate directly with your CRM and ERP systems, and provide real-time dashboards that show reps exactly where they stand against quota. For CFOs, this means faster month-end close, better forecasting, and significantly reduced administrative overhead.
The ROI is measurable: companies report 70-80% reduction in time spent on commission administration, fewer disputes, and improved sales performance due to increased transparency. When reps can see their earnings in real-time and understand exactly what drives their compensation, they close more strategically.
Commission structure design isn't just an HR exercise—it's a strategic lever that directly impacts revenue outcomes and sales budget efficiency. Enterprise and SMB markets require fundamentally different approaches because the underlying sales motions are fundamentally different.
The key is alignment: your commission structure should reinforce the behaviors that drive revenue in your specific market. For SMB, that means velocity and volume. For enterprise, it means persistence, relationship-building, and strategic value delivery.
As you evaluate or redesign your commission plans, remember that the best structure is the one your reps can understand, your finance team can execute efficiently, and your executive team can use to drive strategic decisions. Transparency, automation, and flexibility are the foundations of a commission program that scales with your business.
What commission challenges are you facing in your organization? The conversation around compensation design continues to evolve, and learning from peers across industries helps us all build better, more equitable, and more effective incentive programs.
By Jose Fernandez
https://www.linkedin.com/in/joseluisfernandez/
About The author
Jose Fernandez is part of the team behind EasyComp.ai, building infrastructure that helps companies run sales compensation without spreadsheets, confusion, or delays. He believes incentive systems should be easy to operate—and crystal clear to the people who earn them.
Gabe Salzer
Revenue Operations
Strategy - HIGHTOUCH
EasyComp is so intuitive that our sales team needed almost no training to get started. Now, our account executives have real-time payout visibility, with clear explanations that eliminate back-and-forth with operations, allowing them to stay focused on closing deals.
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