SPIFF, short for Sales Performance Incentive Fund, is a short-term bonus that a salesperson receives for achieving a specific goal, such as selling a particular product or closing deals before a deadline. Because SPIFFs are immediate, targeted incentives, they encourage employees to focus on the result the company wants within a set time.
Updated October 2026. We clarified the definition of a SPIFF, removed an unsourced statistic and an unverified company example, and added a note on how cash rewards are taxed in the US. This is general information, not tax or legal advice.
Well-designed SPIFFs are a great way to reward and appreciate a salesperson’s hard work.
What is a Sales Spiff?
As soon as someone starts working in marketing jobs, they come across the word SPIFF. However, many people are unsure what sales SPIFFs are and what they mean for their pay. In this article, we briefly explain what a sales SPIFF is and how it benefits a business.
A SPIFF sits on top of the regular sales compensation plan. A commission plan rewards overall sales performance across the year, while a SPIFF targets one narrow action for a limited period, often a few weeks to a quarter. SPIFFs are usually set by a sales manager or the company and can be awarded to an individual or a whole sales team.
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Sales Spiff Examples
A company’s growth depends heavily on its employees’ hard work, so it is important to motivate them and celebrate their success. SPIFFs can be an effective way to link that recognition to the company’s goals. There are two types of sales SPIFF programs:
Cash SPIFFs
Cash is the most common kind of SPIFF and works well for many people, because money lets them choose or buy whatever they want. The amount should be fixed and announced clearly to everyone taking part, so the rules are transparent and motivate the whole team.
Rewarding employees with cash is appealing and can encourage them to come up with new ways of achieving their goals.
Cash SPIFFs are usually set at a fixed amount, for instance, a set bonus for every deal of a particular product closed during the campaign. They work best when your team already has the ability to win those deals. In the US, the IRS states that cash or cash-equivalent items provided by an employer are never excludable from income, so cash SPIFFs are taxable for the employee.
Non-cash SPIFFs
Although cash is a convenient way of giving SPIFFs, it won’t always appeal to everyone. Imagine giving a holiday trip as an incentive instead: the employee is likely to remember the reward each time they think of the trip. That is why many companies also use non-cash SPIFFs such as gift cards, merchandise, experiences or travel.
Moving on with the examples of non-cash incentives, they are endless. That could be anything, from a useful present to a dinner in a lavish restaurant.
Nevertheless, the rewards depend upon the nature of the working individuals. What kind of honours would they like to receive?
Here are a few popular sales SPIFF ideas:
- Dine out with the family at a premier restaurant
- Entertainment tickets for top seats at a Broadway show or a major sporting event
- A paid vacation or trip abroad
- Weekend stay at a 5-star hotel with family
Sale Spiffs Template
It is essential to set out clearly what the SPIFF rewards and what employees gain from achieving it. A simple written template helps: state the goal, the time period, who is eligible, how results are measured and what the reward is. Presenting the scheme creatively and engagingly makes it more likely that your team will get behind it.
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Car Sales Spiff Ideas
If you are a car dealer, you know how important your sales staff are to the business, so it is worth motivating them to reach their sales targets. Here are some ideas for distributing SPIFFs in an engaging way:
Cash In Hand: This could be one of the best ideas to motivate your employees. Rewarding cash also opens the opportunity for an employee to get whatever they want.
Rewards of Unspeakable Value Change: If you’ve already got the employee who has reached the goal of the month, you call their family or spouse to ask what they want as a present. Hence, this will also establish friendly relationships between the company and its employees.
Conclusion
Whether you’re running a small startup or a big sales organisation, well-designed SPIFFs can help boost employee morale, teamwork and performance.
With several ways of rewarding SPIFFs, you can build stronger relationships with your employees while they help bring more business to the company.
