Commissions

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Introduction

Incentivizing your sales team is one of the most effective ways to drive performance, increase productivity, and maintain a healthy competitive spirit. The Commissions feature in Odoo 18 provides a streamlined and configurable system to reward salespeople or sales teams based on their performance.

Whether your goal is to increase revenue, improve margins, boost contract volume, or grow recurring income, Odoo’s Commissions feature enables the creation of measurable, flexible, and fair compensation structures.

Step-by-Step Instructions


Activating the Commissions Feature

 

To begin using commissions in Odoo 18:

  1. Navigate to the Sales application.
  2. Go to Configuration > Settings.
  3. Scroll to the Invoicing section.
  4. Enable the checkbox for Commissions.
  5. Click Save.

Once enabled, a new Commissions menu becomes available in the top menu bar.

Creating a Commission Plan

To create a new commission plan:

  • Go to Sales > Commissions > Commission Plans.
  • Click Create.

Each commission plan includes the following components:

  • Based on: Choose between Targets (goal-based) or Achievements (flat-rate).
  • Per: Apply the plan to individual salespeople or sales teams.
  • Target Frequency: Determine how often targets are measured – Monthly, Quarterly, or Yearly.
  • Achievements: Define what is being measured – such as revenue, volume, or margin.

Target-Based Commission Plans

In a Target-Based commission plan, payouts are based on how much of a predefined sales target is achieved. This method is ideal when setting specific, measurable goals, such as achieving a quarterly sales volume.

Steps to Configure:

  1. Go to Sales > Commissions > Commission Plans > Create.
  2. Set Based on to Targets.
  3. Choose the relevant Per (Individual or Team).
  4. Define the On Target Commission – the amount paid for reaching 100% of the target.
  5. Set the Effective Period (start and end date).
  6. Choose the Target Frequency:
    • Monthly – for short-term incentives.
    • Quarterly – for performance aligned with business cycles.
    • Yearly – for long-term strategic goals.
  7. In the Targets tab, define target values for each period.
  8. In the Achievements tab, specify the performance metric(s) being tracked.
  9. In the Sales People tab, assign users individually or in bulk.

Note: The Add Multiple Salespersons option is only available when Developer Mode is activated.

 

Commission Levels

To provide additional motivation, you can define commission levels. These are performance tiers that allow salespeople to earn commissions even if they don’t hit 100% of the target—or earn more if they exceed it.

For example:

  • 80% of the target: 3% commission
  • 100% of the target: 5% commission
  • 150% of the target: 7.5% commission
  • 200% of the target: 10% commission

Commission levels are configured in the Commissions tab of the plan.

Important: If no levels above 100% are defined, exceeding the target will not result in higher


Achievement-Based Commission Plans

 

An Achievement-Based commission plan calculates payouts based on actual performance, using a consistent rate without requiring predefined targets. This structure is ideal for ongoing compensation strategies, such as paying a flat percentage on all invoices.

Steps to Configure:

  1. Go to Sales > Commissions > Commission Plans > Create.
  2. Set Based on to Achievements.
  3. Choose the Per type (Individual or Team).
  4. Define the Effective Period and Target Frequency.
  5. Under the Achievements tab, add the relevant performance metrics.
  6. Assign salespeople under the Sales People tab.

Available Achievement Metrics

 

You can choose from several measurement types for tracking sales performance:

Metric

Description

Amount Sold

Total value of confirmed Sales Orders (SOs).

Amount Invoiced

Total value of confirmed invoices.

Quantity Sold

Total units sold via Sales Orders.

Quantity Invoiced

Total units invoiced.

Margin

Profit margin, calculated as (Selling Price – Cost Price).

MRR

Monthly Recurring Revenue (available only if the Subscriptions app is installed).

Note: Every commission plan—whether based on Targets or Achievements—requires both a target frequency and achievement metrics to be set.

Approving and Managing Plans

Once your commission plan is configured, click Approve to activate it.

Important: After approval, commission plans become read-only. To make further changes, click Reset to Draft, make edits, and re-approve.

Odoo will automatically begin tracking sales performance and calculating commissions as per the rules defined in the plan.

Conclusion

With Odoo 18’s Commissions feature, businesses can align compensation with strategy by designing incentive plans that reward performance. Whether you’re aiming for aggressive sales targets or consistent revenue growth, the tool offers the flexibility to adapt your commission structure to your business goals.

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