One of our coaching clients asked about a sales contest. In my opinion, a contest that has the salesperson competing with themself is the best way to go.
Have each salesperson set their own sales goal (or goals). The goal must be realistic but also productive and financially worthwhile for the company. To run a contest, each salesperson tries to beat the goals they have set either by dollar volume of sales or percent of sales over the goals.
Pitting salespeople against each other seldom gets everyone involved, and more often than not will cause a company to lose steady productive sales people. The salespeople who do a good job and are consistent but for whatever reason never sell enough to win any contests will get discouraged and leave.
Give your sales staff a break and encourage them to sell. If they all win, you win, too!