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SPIFF (Sales Performance Incentive Fund) is a short-term reward that sales reps receive for meeting their assigned goals and objectives within a specific time frame. Since SPIFF is an immediate bonus, it motivates sales reps to achieve optimum performance while working on their goals and objectives.

SPIFF is a great way to ensure you have a fun and rewarding work culture within the company. SPIFF allows you to reward your top performers at the end of each quarter based on their performance.

What is a SPIFF in sales?

SPIFF (Sales Performance Incentive Fund) is an amount that a company sets aside to reward its sales reps for achieving short-term goals. SPIFFs are a great way to motivate and reward your sales staff while helping your company grow to greater heights.

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What is a SPIFF program?

A SPIFF program is a short-term campaign to incentivize or reward the sale of certain services or products. If a rep is shaky on their sales numbers and needs an extra push, vendors love to give them a small bonus for going above and beyond — especially when you add it up to the base salary.

SPIFF programs can include rewards like an extra commission or gift cards but can also involve more complicated benefits such as partnership upgrades, cash prizes, or holiday trips.

Do sales SPIFFs work?

Yes, they do. Salespeople are often motivated by money and recognition, and SPIFF is a way to help them achieve both. 

The benefits of implementing SPIFFs for sales are numerous and these include:

  • Encourages healthy competition between employees, which increases productivity and quality of work.
  • Strengthens the relationship between the employer and the employee.
  • Boosts morale by enabling employees to receive financial rewards for exceeding their targets.
  • Improves performance and productivity by encouraging reps to work harder and more efficiently to earn more money. This has a direct impact on an individual's productivity level as well as overall team performance.

What is the difference between SPIFF and commission?

SPIFF is a percentage of sales, whereas commission is a percentage of profit.

SPIFF is a flat rate that is paid to the affiliate based on the sale of an item. The flat rate can be calculated in any way the merchant wishes but will usually be based on the profit or revenue generated by each sale.

A commission is usually calculated as a percentage of the total net profit generated by a sale. If you're paying a 10% commission, and your product costs $100 to make and sell for $110, then your commission would be 10% (or $10).

What is the difference between a SPIFF and SPIV?

The difference between a SPIFF (Sales Program Incentive Funds) and SPIV (Sales Performance Incentives) is that a SPIFF is a temporary incentive while a SPIV is a permanent incentive.

  • SPIFFs are often used as short-term incentives, as they can be more effective than bonuses in boosting sales. However, they are only available until the end of the fiscal year.
  • SPIVs are provided to employees based on their performance over time, not just at the end of the fiscal year.

What are the types of sales SPIFFs?

A SPIFF is a bonus that a company gives to its employees. It can be classified into two types:

  • Cash SPIFFs: These can be paid in cash, check, or gift cards. It can be used for anything from a bonus for hitting a particular sales goal to an incentive for a specific action. For example, a salesperson might get $500 worth of payout when they bring in new business from an existing customer.
  • Non-Cash SPIFFs: These include gift cards and merchandise. They may be given out as door prizes or employee award programs at the end of the year. A company selling advertising space could give away t-shirts or hats with their logo as non-cash spiffs at their annual sales conference.

Pro tip:

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How to run a successful sales SPIFF program?

Here's a step-by-step process to follow to run a successful SPIFF program:

  • Understand your goals and define them clearly: This is where you determine what success looks like for your company and figure out how much of a role sales incentives will play in achieving those goals.
  • Articulate how your reps should achieve your goals: Clearly communicate your goals and expected behaviors. This could be anything from calling on certain accounts more often than others, booking more appointments, or selling more products to customers who haven't purchased them before.
  • Establish who can participate: Decide if everyone on the team will be eligible or if only certain people need incentives (e.g., managers vs. individual contributors). 
  • Decide a timeframe: Designate a timeframe for when the promotion will take place (i.e., end of the quarter, end of the month) so that employees can plan accordingly instead of rushing at the last minute to ensure they meet their goals in time for the deadline.
  • Budget properly: SPIFF programs can be more expensive than you might anticipate. Always be aware of the potential costs associated with these programs and make your plans appropriately.
  • See if it was worth it: Have a strategy to determine the program's success. The metrics that best match your sales objectives should be defined and used as a guide. In this manner, you can decide whether or not to carry out a comparable spiff in the future.

Are SPIFFs taxable?

Yes, SPIFFs are taxable. In many cases, they can often be taxed depending on the exact type of reward or incentive. Make sure that your employees are making themselves aware of any SPIFFS taxes that may be associated with those incentives.

Employee pulse surveys:

These are short surveys that can be sent frequently to check what your employees think about an issue quickly. The survey comprises fewer questions (not more than 10) to get the information quickly. These can be administered at regular intervals (monthly/weekly/quarterly).

One-on-one meetings:

Having periodic, hour-long meetings for an informal chat with every team member is an excellent way to get a true sense of what’s happening with them. Since it is a safe and private conversation, it helps you get better details about an issue.


eNPS (employee Net Promoter score) is one of the simplest yet effective ways to assess your employee's opinion of your company. It includes one intriguing question that gauges loyalty. An example of eNPS questions include: How likely are you to recommend our company to others? Employees respond to the eNPS survey on a scale of 1-10, where 10 denotes they are ‘highly likely’ to recommend the company and 1 signifies they are ‘highly unlikely’ to recommend it.

Based on the responses, employees can be placed in three different categories:

  • Promoters
    Employees who have responded positively or agreed.
  • Detractors
    Employees who have reacted negatively or disagreed.
  • Passives
    Employees who have stayed neutral with their responses.

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