Sales & Distribution

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Sales Managementand sales promotion & Distribution and supply chain managementMMS / PGP III

Prof M.R.Koshti

Session no.1

40 slides

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Mark System (100)

Written paper 30 marks each, 2 hrs each, separate papers

1. Sales management & Sales promotion

2. Distribution & supply chain management Attendance 10 Class Participation 10 Sales assignment 10 Presentations 10**

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Syllabus – Sales Management and Sales promotion

1. Job and role of sales management in organizations

2. The selling Functions – The importance of systems selling -- in contemporary environment, selling of services, services as opposed to selling of tangible products – selling process**

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Contents…..

3. Sales Management Planning – Sales Management Information systems, Sales management—planning—Forecasting

4. Sales Budgeting and planning for quotas

5. Manpower planning for the sales organization and development of sales organization**

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Contents....

6. Recruitment, selection, training and development of sales organization

7. Time and territory management—Territory planning, establishing, revising territories, bases of territory design, methods of territory design including computer models, assigning sales people to territories, Route planning and territory coverage**

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Contents…

8. Sales incentives and sales compensation

9. Sales force performance, evaluation and control

10. Sales promotion strategies / consumer and trade promotion / sales contests, coupons / trade in discounts**

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Contents – Distribution and supply chain management The role of distribution function in marketing

mix and meaning of distribution equity Channel design and management of

consumer, industrial products, rural markets and services

Tasks and responsibilities of channel members

Channel selection, training, development, and performance appraisal of channel members**

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Financial dimensions of dealer management Management issues in distribution viz.

channel conflicts, use of power bases, disputes etc.

Supply chain management – issues opportunities and strategies**

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Distribution budgeting and control systems – cost of distribution, inventory, warehousing, material handling, order processing, packing and transportation

Fiscal levies, regulations in distribution –CST, LST, octroi, excise duties etc**

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Books

1. Sales and Distribution Management – Matin Khan

2. Sales and Distribution Management – S L Gupta

3. Sales Management, Decisions, Strategies, and Cases – Richard R Still, Edward W Cundiff, Norman AP Govoni

4. The new sales manager – Walter Vieira5. Physical distribution management logistical

approach – Dr K Khanna**

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What is sale?

Actual event when the customer purchases (commits in writing to purchase) the product and makes payment (commits to pay) for the same

Evolution – Barter system – Manufacture on small scale – Manufacture on large scale (World wars) – Need to sell (after war was over) – Make customers buy what you produce (Sales organization) – Marketing**

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Difference between Sales & marketing

Sales is a subset of Marketing Sales is a part of promotional P Which is more important? Sales in short term and marketing in long

term**

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Why Sales (Management) is important? No wheel turns unless a sale is made Excellent product ideas can go in dust been if

it can not be or is not sold (Patents) Sales Dept is the income producing division

of business Rs 1000 Cr + - 50 / 900 Effect of sales on profit is huge (% wise) Everyone lives by selling something**

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What could you do to increase sales?

Situation I have just joined your company as Director –

Sales. You are my expert sales people. My task is to increase sale I wouldn’t reject any idea on the point of

budget All ideas will be considered**

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Ways to increase sales More advertising TV advertising Newspapers and magazines Trade shows and publications Sponsorships New product lines Improve existing products Increase stock Increase number of sales people Increase number of locations Take over the competition (budget not a constraint!!) Reduce prices Better cars for sales-people Incentives More training**

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Control, Influence, and concern (Seven habits of successful people – Stephen Covey) Somethings that happen in the world are

completely outside our control – poverty, climate change, economy, crime ……You can certainly have a concern about them

People who focus their attention on such things get very depressed**

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There are some-things which I can influence, but still can not control them e.g. you can influence customers and colleagues

People who focus on things they can influence are negative and cynical

Their focus is on what other people should be doing**

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There is something I have complete control, 100% control

That is my own attitude. People who are successful in life focus on

their own attitudes**

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Ways to increase sales

I will pick up the phone more times Work harder See more people Ask all of them to buy Learn about my own products Support my colleagues Learn about selling Read books about selling**

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Serious deficiencies of salesmen

A survey conducted in US over 10,000 industrial buyers revealed…

96% said that the sales people did not ask for a commitment on an order form, apparently because they “lost control” of the sales situation

89% said the sales people did not know their products 88% said the sales person did not present, or demonstrate, the

products they are selling, what they appeared to be selling was price

85% said that the salespeople lacked empathy 82% said that they will not buy from the same salesperson or

companies again and cited “neglect” and “indifference” as the major reason**

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Comparative analysis of the top problems faced by Sales force management (ranked)1. Poor utilization of time and planned sales effort

2. Inadequacy in sales training

3. Time wasted in office by salespersons

4. Too few calls in working hours

5. Inability of salesperson to overcome objections

6. Indifferent follow up of prospects by sales persons

7. Lack of creative, resourceful sales techniques

8. Inability to meet competitive pricing

9. Lack of sales drive and motivation

10. Faulty recruitment and selection of sales personnel**

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Sales Management

Definition committee of American Marketing Association

Sales Management means the planning, direction and control / supervision of personal selling (salesmen), including recruiting, selecting, equipping, assigning, routing, supervising, paying, and motivating as these tasks apply to personal sales-force**

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Situations of personal selling

Industrial marketing (Business to business marketing B2B)

Direct selling companies (Eureka Forbes, Amway, World book, Banking and insurance products etc)

Consumer durables**

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Sales manager

Responsible for organizing sales efforts both within and outside their companies

Member of the executive group that makes marketing decisions of all types**

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Objectives of Sales ManagementResponsibility towards organization

Sales Volume To retain and capture market share (HLL) To obtain new accounts (customers) of given type To secure targeted percentage of certain accounts of business Contribution to profits To deliver sales volume in ways that contributes to profitability (breakeven / margin of safety) To keep personal expenses within specified limits Continuing growthReceive orders, coordinate deliveries, collect money**

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Systems selling

What does it mean as opposed to product selling?

Selling of main and complimentary products so that the customer gets a solution under one roof (from one seller only) to solve his problem / need**

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Systems selling Why is it important in the new (contemporary) environment? Buying individual components of the system from individual

sellers is time consuming Compatibility issues Pointing fingers by individual vendors to each other if the

combination does not work Ever increasing competition has made quick response to

consumer need as a tool for survival (System Integrators-SI)**

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Selling of services

4 I’s Intangible Inconsistent Inventory Inseparable**

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Selling process

1. Prospecting2. Pre-approach3. Approach4. Presentation and demonstration5. Proposal6. Handling objections / Negotiation7. Closing8. Follow up**

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Prospecting

Process of identifying potential buyers (have need, will to buy ,and power to buy)**

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Methods of prospecting

Acquaintance (satisfied customers) references Cold calling Centre of influence method – references from

politician, actors…. Personal observation method Direct mail or telephone method Company record – old/lost/current customers Newspapers (tenders) Too late? Retailers Trade fairs, Exhibitions**

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Pre - approach

Research Likes, dislikes Needs, preferences Habits, nature, behavior Economic and social status Process of qualification of prospect (Prospect

is qualified if he will buy within the stipulated current time period)**

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Approach

Prospect and salesman come in contact with each other face to face

Objectives – To get the attention of the prospect, convince him to buy

Critical requirement – Listening**

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Keys to successful approach

Prior appointment Confidence, professionalism, command over

the information about the product, Formal business attire

Make prospect feel relaxed Respect the views of the prospect, no

arguments Patience (if no sale happens in that visit)**

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Presentation and demonstration

Seeing is believing Increases customers’ confidence in the

product Offer the product for handling Sell benefits not the features**

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Proposal

Complete in all respects Technical configuration Price Terms and conditions – Payment, Warranty,

After sales service**

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Tackling objections

Objections are not hurdles They are opportunities No objection, no interest, NO SALE Opportunity for trial close**

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Handling objections

Get full basket from the prospect Trial close Answer the objection Negotiate / Trade the offers**

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The close

Customer signs the purchase order “How many should I book for you” When will you like to have delivery? Will you pay by cash or cheque? Which color would you go for?**

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Follow up

Process the purchase order in the office Coordinate for timely delivery Coordinate installation and acceptance Collect payment**