That doesn't work when you're setting targets for very aggressive growth. A much higher % of salespeople won't hit their quotas, and not because of bad performance, but usually because of bad (aggressive) planning.
Letting those many people go would mean spending too much money on replacements, that probably still won't sell their quotas.
in the essence, you market analysis (value generated to customer, willingness to pay, potential market size is wrong.
As you said, this looks like a business model failure, not a sales failure.