Crediting Rule

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What is a Crediting Rule?

Crediting rule is a policy that determines when and how salespeople receive credit for a sale. It specifies which rep (or reps) gets commission credit based on factors such as timing, territory assignment, customer relationship, or involvement in the sales process. According to Pavilion (2024), unclear crediting rules are the most common cause of commission disputes—responsible for 47% of all compensation complaints.

Why Crediting Rules Matter

Well-defined crediting rules are essential for sales organizations:

  • Prevent disputes: Clear rules eliminate discussions about deal ownership
  • Ensure fairness: Reps understand how they'll be compensated before pursuing deals
  • Drive behavior: Rules shape which opportunities reps prioritize
  • Enable collaboration: Team selling works when credit rules are transparent
  • Reduce admin: Automated rules eliminate manual credit decisions

According to Alexander Group (2024), companies with well-documented crediting rules have 34% fewer escalated disputes.

Types of Crediting Rules

Rule Type Description Best For
Territory-based Credit to owner of customer's territory Geographic sales models
Account-based Credit to assigned account owner Named account models
Opportunity owner Credit to whoever created the deal Transactional sales
First touch Credit to whoever sourced the lead Lead-gen focused orgs
Last touch Credit to whoever closed the deal Closer-focused models
Split credit Multiple reps share credit Team selling

Crediting Rule Examples

Example 1: Territory-Based Crediting

Customer headquartered in Texas closes $90,000 deal:

Scenario Credit Assignment
Single territory 100% to Texas rep
Multi-location customer Split by revenue per location
Territory change mid-deal Based on ownership at close

Example 2: SDR + AE Crediting

SDR sources lead, AE closes deal:

Role Crediting Rule Credit %
SDR Sourcing bonus Flat fee or 10-15%
AE Full deal credit 85-100%

Example 3: Account-Based with Specialist

Named account rep owns relationship, specialist assists:

Role Crediting Rule Credit %
Account Owner Primary credit 70-80%
Specialist Overlay Assist credit 20-30%

Key Decisions for Crediting Rules

When is Credit Triggered?

Trigger Description Use Case
At booking When contract registered as won Simple, immediate
At invoice When customer is invoiced Transactional products
At payment When cash is received Conservative cash flow
At go-live When implementation completes Complex solutions

What Triggers Credit?

  • New business: First sale to a customer
  • Expansion: Additional products or users
  • Renewal: Contract renewal
  • Upsell: Upgrade to higher tier

Crediting Rules by Sales Model

Sales Model Typical Crediting Rule
SMB/Transactional Opportunity owner gets 100%
Mid-Market Territory-based with account ownership
Enterprise Account-based with overlay splits
Partner/Channel Split between partner and internal rep
PLG/Self-serve Territory for expansion, no credit for self-serve

Best Practices for Crediting Rules

Document everything: Write all crediting rules in a policy document. Include examples and edge cases.

Handle exceptions consistently: Create a process for unusual situations. Document decisions to build precedent.

Align with CRM data: Crediting rules should map to fields in your CRM. If territory determines credit, territory must be correct.

Review quarterly: As the business evolves, crediting rules may need updates.

FAQ About Crediting Rules

What happens with territory change mid-deal?

Clearly define whether credit follows original or new owner. Most companies lock credit at a specific stage (e.g., "proposal sent").

How are multi-location customers handled?

Either split by revenue per location, or 100% to headquarters territory. Choose one model and stick to it.

What about inbound leads in a rep's territory?

Typically territory owner gets credit regardless of lead source, but SDR/marketing may get sourcing bonus.

Automate Crediting Rules with Prowi

Manual credit assignment creates errors, disputes, and administrative burden. Prowi automatically applies your crediting rules based on CRM data, handles splits, and provides full audit trail for every credit decision.