Ever seen a talented sales rep lose their momentum because their compensation plan didn’t line up with how long it takes to close deals? When compensation plans don’t work the way they should, they can make your best people start looking for other jobs faster than you’d think. Cash draws and accelerators can help with different parts of this problem. But if you pick the wrong one for your team, you’re setting yourself up for problems.
Why would you want to give money upfront when you could instead give your team more reasons to beat their goals? How you handle this will change how your team acts in just a few weeks. And why would you want to stick your top performers with flat rates when what they actually want is the opportunity to exceed their targets?
The way you set up compensation shapes every single sales conversation your team has. If you don’t get it right, you’ll spend all your time dealing with people leaving instead of actually helping your business grow.
I’ll explain how these two tools work and help you figure out when to use each one for your team.
What Are Cash Draws and When They Help
Cash draws are advance payments that give sales reps steady income before they start earning commissions. Think of them as a financial bridge that helps reps pay their bills while they’re building up their pipeline.
Most draws work in one of two ways. With recoverable draws, the company takes the money back from future commission checks once the rep starts making sales. Non-recoverable draws are free money that reps get to keep even if their commissions never reach what they received. Most businesses stick with one type or the other.
Take a biotech rep with an 18-month sales cycle who gets a $3,000 monthly recoverable draw. She can pay her bills while she works on those long-term deals. When her first big commission check comes in, the company will start taking out that $3,000 each month until they get back what they gave her upfront. These very long sales cycles make this kind of arrangement necessary.
You can see why this makes sense when you look at how new sales hires usually run into a 3-6 month ramp period with very little income. These draws take away that early stress and help businesses keep talented people during those first few months when they’re still learning. Very talented sales reps who might jump ship to another company usually choose to stay put when they have income they can count on. Your costs to find new people go down when they stay past the 90-day mark. This way, you don’t have to keep hiring and training new people all of the time, which takes up plenty of your sales managers’ time.
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The problem is that some reps might take their time when they know that the monthly check is coming no matter what. Maybe a higher base salary would have given them the same security – and honestly, it probably would have. But draws give businesses more flexibility when they want to keep their fixed costs down.
The worst problems usually come from bad record-keeping and unexpected requests to pay money back that reps weren’t expecting. Most payroll systems keep track of draws in a different place from normal pay. Sales reps get confused when they see money taken out of their checks months later that they weren’t expecting. The people in finance have to rush around trying to make the numbers match up when someone leaves before they’ve paid back their draw.
How Accelerators Change the Sales Game
Most businesses end up working with multiple tiers to keep their reps motivated without making the compensation plan too hard to follow. When you look at what actually works, two to four tiers is a pretty common number. Some accelerators will apply to all your sales once you cross a certain threshold, while others are only going to increase the revenue you bring in above quota.
When you get the tier structure right, it’s going to affect your entire sales culture. Teams usually develop different rhythms when they can see obvious earning jumps ahead of them. Your compensation plan turns into a guide that shapes how your reps approach each quarter.
The psychology here is pretty interesting. When reps get close to a higher tier, they’ll usually push harder because they don’t want to lose that better rate. This competitive drive works great for businesses that want aggressive growth. But there’s definitely a downside you need to watch out for.
When you set quotas too low, your reps might try to work the system or hold back deals so they can time their accelerators better. This actually happens more than you’d think. Businesses have started putting payout caps in place and other controls to manage this issue. They want to motivate their teams without going over budget when someone has an unexpectedly huge quarter.
When reps get close to the next tier, it creates real urgency across your sales teams. Your rep might work late into December just to cross that final threshold. If they miss a tier, they’re going to lose out on serious money. The way reps think about their work completely changes because accelerators make hitting quota feel different than just meeting basic targets.
The numbers tell the full picture. About 80% of sales plans now use accelerators because they actually help teams perform above quota. Most businesses use them now because they’ve seen strong results across different industries.
What the Math Shows for Your Team
Now, let’s put these tools side by side so we can see how they actually work in practice. The best way to see what these differences mean for your team is to run the numbers for different rep performance levels.
Let’s look at three sales reps under each compensation model. Rep A reaches 80% of the quota, Rep B hits 100%, and Rep C reaches 120%. Under a cash draw system, all three reps get steady monthly payments no matter how they perform – the math here is simple. Rep A will need to pay back the difference through future commissions, while Rep C gets to keep the extra money right away.
When you switch to accelerators, the whole picture changes. Rep A earns standard commission rates with no debt to worry about. Rep C sees their commission rates jump quite a bit after passing their quota, which means they can make a lot more money. The difference in performance gets bigger quickly under accelerators. Your best performer might make 50% more than they would under draws during their best months. That extra money shows up in their account the same week they close the big deals. Your lower performer doesn’t have to worry about owing money back like they would with draws when they have a bad quarter.
For finance teams, draws give you predictable monthly costs. But they also create risk if reps can’t pay back what they’ve been advanced – controllers have to track these balances every month. Accelerators are a different story – they keep your base costs the same while your commission spending goes up when the team does well.
The timing of when people get paid actually matters quite a bit. Draws help reps pay their bills at the beginning of the quarter. But accelerators give your best performers extra money right away. Each approach sends a different message to your reps about what kind of behavior the company values.
Your compensation plan really shows what type of rep you’re looking to bring in. The best performers usually want accelerator plans because these plans reward them more generously for their skills. Average performers usually like the steady income that draws offer when business is slow.
This is where the real analysis comes in – you can map out these different scenarios with actual quota numbers from your team to see which model strikes the right balance between keeping your reps motivated and managing your company’s cash flow.
Three Factors That Drive Your Choice
When you’re choosing between cash draws and accelerators, there are three main factors you need to think about. You need to look at your rep tenure, sales cycle length, and company comfort with risk.
New reps almost always need the stability that draws give them. They don’t have the track record or confidence to handle purely performance-based pay. However, experienced veterans usually want accelerators because they trust their ability to close deals and want to maximize their earnings. If a new hire has to handle unpredictable income, they’ll spend more time worrying about bills than closing deals. They end up counting paychecks instead of getting to know clients. But if you give them financial stability, they can actually concentrate on learning your sales process.
The length of your sales cycle matters just as much as rep experience. Short cycles favor accelerators because reps can see quick results from their work. With longer cycles, you’ll need draws to keep reps motivated through those inevitable dry spells between closes.
Your company’s comfort with risk is what actually makes the final call. Say a cybersecurity firm uses accelerators for veteran hunters who can handle the pressure. At the same time, a medical device maker with 12-month purchasing cycles probably relies on draws to support their field reps through those extended sales processes. If you mismatch the tool and the situation, trust goes out the window pretty fast. If reps expected steady income but got feast-or-famine accelerators instead, they’ll start to look elsewhere. Companies that give draws without straightforward recovery terms create confusion and resentment.
Get the compensation structure wrong, and people start leaving right away. Your best performer will question their future when paychecks disappear for months. If you have to replace them mid-cycle, you’re going to lose both their active deals and everything they know about your customers. Before you choose, ask yourself some hard questions. Are you comfortable with recoverable debt on your books? Does your culture actually celebrate stretch goals or just talk about them? Different states also have different labor laws for recoverable draws – the rules change depending on where you are.
Most companies find that neither option works exactly right alone. Hybrid models usually solve most compensation dilemmas without causing extra problems down the road.
How to Mix Different Pay Systems Together
Most businesses don’t actually have to choose just one way when they set up compensation. You can blend cash draws with accelerators, and this combination gives you the benefits of each system. This flexibility gives you way more room to work with different team needs and situations.
One popular hybrid system starts new reps with a cash draw for their first six months. After that, it switches them over to pure accelerators once they get comfortable in their role. This approach gives people a steady income while they’re still learning how the job works. It also rewards high performance once they’re ready to take on bigger deals. Most teams I’ve worked with see this transition happen somewhere around month four.
You could also pair accelerators with what some people call “decelerators” for underperformance. If you hit your number, you earn extra commission. If you miss it, your rate drops below the standard baseline. This system creates obvious consequences without being too harsh on your team.
The main benefit here is that you get balance. You get predictable cash flow in the beginning, unlimited upside opportunities later, and built-in guardrails to protect your budget. Your finance team gets budget predictability, while your sales team gets earning opportunities. Each side can plan ahead with confidence. That’s why hybrid models have become so popular in recent years.
But here’s where it gets tricky. The more moving parts you add, the harder your plan becomes to follow. If your compensation structure needs a calculator and three coffee breaks to explain, you’ve probably gone too far. Too much complexity will stop people from buying into your plan faster than just about anything else.
Try this test before you launch anything new. Say you have five minutes to explain your plan over Zoom to a brand-new hire. Can you do it without losing them? If the answer is no, then you need to go back and simplify the system. Direct communication gives you better results than complex calculations ever will. Your reps need to know how they earn money before they can actually start earning it.
Ask yourself a few quick questions before you move forward. Does this plan motivate their behavior? Can our payroll system manage the calculations? Will managers be able to answer questions about it? These operational details will determine if your plan succeeds or creates endless problems down the road.
Level Up Your Incentives and Rewards
Your top performers will start to look elsewhere when they feel like they’re not valued enough, while your underperformers usually stay longer than they should. This changes everything from how your team feels about coming to work each day to your quarterly forecasts.
As you move forward with these plans, consider how these compensation tools will change along with your sales organization over the next year or two. The industry is changing fast, and new analytics and information are making it easier to see what really gets your people going. But don’t get stuck trying to find the perfect answer before you start. You can make most adjustments within a quarter anyway, so there’s no need to overthink it. Instead, make sure your team understands how these tools work and why you’re putting them in place. When people understand the thinking behind their compensation structure, they start to trust you more – and that trust leads right to better performance and retention.
The right partner can make all of the difference with your sales incentive programs. At Level 6, we specialize in helping your business grow through all kinds of incentive programs that go beyond traditional compensation structures. We help you improve your sales team’s performance and make your employees happier. Our expertise covers every part of motivation and rewards.
Our programs include branded debit cards, employee rewards and recognition programs, and sales incentive programs built just for your business. We build programs that drive measurable results, and we’ll help you put everything you learned here into practice.
Reach out to us now for a free demo, and we’ll show you how we help high-performing businesses maximize their ROI and sales performance!
Claudine is the Chief Relationship Officer at Level 6. She holds a master’s degree in industrial/organizational psychology. Her experience includes working as a certified conflict mediator for the United States Postal Service, a human performance analyst for Accenture, an Academic Dean, and a College Director. She is currently an adjunct Professor of Psychology at Southern New Hampshire University. With over 20 years of experience, she joined Level 6 to guide clients seeking effective ways to change behavior and, ultimately, their bottom line.
