Final Sales & Distribution Management

8/15/2019 Final Sales & Distribution Management

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Authors: Tapan k. Panda & Sunil Sahadev

Course: BBA

Prepared By: Hamid Ali Raza | Sour e: Sales & !istri"ution #ana$ement "y Tapan %. Panda & Sunil Sahadev | Preston niversity' (slama"ad


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Learning Objectives

1) Sales & Distribution Management2) Evolution of Sales Management3) Evolution of Personal Selling Strategies4) Nature and Role of Sales Management5) !"es of Personal Selling#) !"es of Selling$) Di%eren e bet'een Selling and Mar(eting

) *e Sales Management Pro ess

Chapter 1: Introduction to Sales Management


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Sales & Distribution Management

+s a Composite Function of Marketing , it *as evolved into (e! area ofMar(eting E-"ertise and .no'ledge

/t fo uses on0

Develo"ment of Sound Sales and Distribution Strateg!Management of Mar(eting *annelsSales or e Management of an rgani ation




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Sales & Distribution Management

raditionall!, mar(eters fo used on Develo"ing Met*ods and Pra ti es toen*an e Sales or e Produ tivit! and E ien ! 6 fo using on /ndividual7sPerforman e

No' fo us is on t*e Pro ess 8 ormulating Strategies and Met*ods forim"roving Selling +""roa *) involved in t*e En*an ement of Performan e

Sales or e Do'nsi ing+""li ation of /nformation e *nolog!En*an e use of elemar(eting.e! + ount Management

*e use of /nde"endent Sales rgani ations

Ele troni Data /nter *angeross un tional eam Selling




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Evolution of Sales Management

Marketing’s Early Development

Mar(eting 'as t*e natural outgro't* of Produ tion Sur"luses

ra!ing 'as t*e beginning of Modern Mar(eting S!stem

+fter "ur *asing goods, raders resold t*em in ot*er 9eogra"*i al:o ations

raders 'ere *ie;! Res"onsible for t*e P*!si al Distribution of 9oods

o"n Economy# Medieval E onomi rgani ations in '*i * ommer iala tivities 'ere on entrated in t*e :o al Po"ulation enters

$gricultural Mi!!leman# Earl! business"erson '*o "ur *ased Sta"leProdu ts from t*e ountr!side and trans"orted t*em to :o al Mar(et forresale

%uil! System $ssociation of Craftsmen'# *e 9uild S!stem "rovidedt*e ba (ground from '*i * irst /ndustrial So iet! emerged




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(agman# Eig*teent* entur! Sales"erson '*o sold 9oods "rodu ed b! t*eDevelo"ing a tor! S!stem

uirements im"ose on

Peddlers




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Cre!it 3nvestigators# Su""lier Em"lo!ed "eo"le '*o evaluated2etailers’ Cre!it and develo"ed %oo! 1ill ?

Commercial raveler 0 redit /nvestigators later on started to sellMer *andise to Retailer

%reeters# Su""lier Em"lo!ed Sales Re"s '*o Soli ited


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Drummers# 1@t* entur! Sales"eo"le '*o Aourne!ed to mer *ants7 "la esof business

/n rease om"etition made 9reeters to travel utside t*e it! *e term 9reeter 'as re"la ed b! Drummer *ere are 'o Bie's about t*e erm CDrummer

*e! CDrummed u" Sales for Manufa tures and *olesalers '*i *t*e! re"resented *e trun(s '*i * 'ere used for arr!ing Sam"les, Personal /tems

'ere s*a"ed li(e Drums




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Selling in 4+t- Century

From .ro!uction to Sales

+t =rst, Selling 'as overs*ado'ed b! tremendous gro't* of

Manufa turing 8/ndustrial Revolution) o us 'as on Produ tion rat*er t*an Selling

Produ tion Sur"luses resulted in ReFemergen e of Sales Era until // 9reat De"ression GG +ggressive Selling GG Need for Su essful

Mar(eting

reation and Ra"id 9ro't* of or"orate De"artments designed toSu""ort Sales E%ort e?g? Mar(eting Resear *

Post'ar Era GG Modern Sales Era GG Professional Sales"eo"le GG9reater Em"*asis on Edu ated Sales Peo"le and E-tensive Sales raining




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ra!itional Sales $pproac-es

During t*e 5Mo!ern Sales Era6 raditional Sales un tion alled

5Salesmans-ip $pproac- Emerge!6

Sales"eo"le7s be*avior 'as onsidered t*e .e! /ngredient in SalesPro ess

Su ess or ailure of a Sales all 'as de"ended on *o' t*e Salesman*andled a Pros"e t

*ere 'ere -ree 7ariations of ra!itional Sales $pproac-es# anned Sales Presentation Stimulus Res"onse *eor! Selling ormulas




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Canne! Sales .resentation

+ "re"ared, Stru tured Sales S ri"t memori ed b! Sales"eo"le irst used in Door to Door Selling and No' in elemar(eting om"an! onsiders t*e


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Selling Formulas

Sales"eo"le *as to lead Pros"e ts t*roug* various Ste"s in aPersuasive manner

$rt-ur Fre!rick S-el!on Selling Course $3D2# +ttention, /nterest, Desire, Resolve are four "rogressive

/denti=able Stages before ma(ing Pur *ase De ision

$3D$# +ttention, /nterest, Desire, + tion




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Emergence of t-e Marketing Concept

During 1@5Hs and 1@#Hs, *e Mar(eting on e"t emerged as a rame'or(for


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Evolution of .ersonal Selling Strategies




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)8 .ersuasion# *e "eddlers arried t*eir inventor! and t*eir goal 'as toPersuade uirement to Knderstand t*e Needs of ustomers Modi= ation of Produ ts, Pri es and ot*er Related Servi es

:8 Consultative Selling );uired to identif! Ne'Needs and Kses for t*e e-isting "rodu ts0

onsultative Selling re>uired Sellers to t*in( li(e


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=8 (usiness Management );*+s > );;+s'# Em"*asis 'as "ut on Management of Sales erritories and + ounts as

Pro=t enters Sales"ersons 'ere e-"e ted to *ave inan ial .no'ledge raining in


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ypes of .ersonal Selling

)8 3n!ustrial Selling# /t is basi all! termed as


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ypes of .ersonal Selling

48 2etail Selling# Retailing is de=ned as de=ned as all t*e + tivities dire tl!related to Sales of Produ ts and Servi e s to Kltimate onsumer

/n Retail Environment, a ustomer a""roa *es t*e seller

:8 Service Selling# Servi es are + tivities or


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ypes of Selling

*e diverse nature of


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ypes of Selling

)8Or!er %etters Salespeople# *ese are t*e sales"eo"le '*ose obAe tiveis to Persuade ustomers to ma(e a Dire t Pur *ase ?

$8 9e" (usiness Salespeople "ersuade Ne'


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DiBerence bet"een Selling & Marketing



Selling1?Em"*asis on Produ t

2?Produ t irst & t*en De ision tosell it

3?Management is Sales Bolumeriented

4?Planning is S*ort erm 6 toda!7sProdu ts & Mar(ets

5?Stresses needs of Seller

#?Bie's business as 9oods

Produ ing Pro ess

Marketing1?Em"*asis on onsumer Needs and

ants

2?Knderstanding of ustomer Needs

& t*en a Produ t or Servi e tosatisf! t*ese Needs

3?Management is Pro=t riented

4?Planning is :ong erm 6 Ne'

Produ ts, omorro'Ls Mar(ets &uture 9ro't*

5?Stressed Needs of


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DiBerence bet"een Selling & MarketingChapter 1: Introduction to Sales Management


Selling

$?Em"*asi es on sta!ing 'it*e-isting e *nolog! and Redu ing

osts

?Di%erent de"artments 'or(

se"aratel!

@? ost determines "ri e

1H?Selling vie's ustomers as last

lin( in


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-e Sales Management .rocess

Sales Management is t*e "ro ess of attaining Sales or e 9oals in E%e tiveand E ient Manner t*roug* Planning, Sta ng, raining, :eading and

ontrolling rgani ational Resour es? Sales Management Pro ess overs *ree /nterrelated Ste"s0

)8Formulation of a Strategic Sales Management .rogramme

Evaluating Environmental /ssues E%e ting rgani ation 8S , PES , oreom"eten ies)

rgani ing and Planning ver +ll Personal Selling E%orts

/ntegrating ver +ll Personal Selling Strateg! 'it* ot*er Elements of

Mar(eting Strateg!

483mplementation of Strategic Sales Management .rogramme

Sele ting, raining, :eading and Motivating a""ro"riate Sales Personnel

Designing & /m"lementing Poli ies and Pro edures to dire t E%orts ofSales"eo"le to a *ieve desired or"orate bAe tives



Ch 1 I d i S l M


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-e Sales Management .rocess

Sales Management is t*e "ro ess of attaining Sales or e 9oals in E%e tiveand E ient Manner t*roug* Planning, Sta ng, raining, :eading and

ontrolling rgani ational Resour es? Sales Management Pro ess overs *ree /nterrelated Ste"s0

:8Evaluation an! Control of Sales Force .erformance

Develo"ing Met*ods and Pra ti es for Monitoring & Evaluating /ndividual &9rou" Sales or e Performan e

a(ing orre tive Ste"s eit*er in ormulation or /m"lementationProgrammes to a *ieve or"orate 9oals



Ch t 2 S lli Skill & S lli St t i


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Learning Objectives

Selling &


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(uying Styles

Chapter 2: Selling Skills & Selling Strategies


Ch t 2 S lli g Skill & S lli g St t gi


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Selling Styles





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Sales ask & Function

+ salesman *as to underta(e various as(s un tions during t*e Pro ess ofSelling? Di%erent Sales as(s un tions from Selling Point of Bie' are0

1? ommuni ation un tion0 *en a sales"erson gives Sales Presentation orma(es a Sales all

2?:istening un tion0 + ustomer ma! *ave Iueries, Doubts and+""re*ensions and 'is*es t*e sales"erson give *im Patient Jearing, t*us,Sales"erson must "erform :istening un tion

3?/nformation un tion0 Providing /nformation about E-isting Produ ts of t*eom"an! and Ne' Produ ts t*at are li(el! to" ome in mar(et

4?Negotiation and


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ypes of Selling Situations

+ ording to di%erent Mar(eting and Situational a tors !"es of Selling are0

1?Maintenan e Selling

*e art of Servi ing t*e E-isting + ounts, Se uring Promotionaloo"eration, ounting /nventor! & a(ing Re"lenis*ment rders

*ere is no need of Pros"e ting as t*is (ind of selling is done 'it* E-istingustomers

2?Develo"mental Selling

*e art of onta ting Potential ustomers and


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Selling Skills





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Communication Skills

*e abilit! and e-"ertise to ommuni ate is ne essar! in Selling un tion

Sales"eo"le s*ould "ossess 9ood Bo abular! and s*ould be able to e-"resst*emselves /ntelligentl!

+ sales"erson abilit! to "er eive Berbal & Non 6 Berbal lues *el" inans'ering bAe tions and =nding about t*e Pur *ase /ntention

+ good Boi e Iualit! im"roves t*e Personalit! of t*e Sales"erson andontributes to t*e su essE%e tive ommuni ation S(ills ontribute in Nurturing :ong 6 erm

Relations*i"s 'it* ustomer based on Mutual rust t*roug*0

rut* of ords/ntent and Em"at*!

ommuni ation S(ills are im"ortant for Persuading ustomers





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Communication .rocess

ommuni ation Pro ess is de=ned as a Set of + tivities & S!stems /ntegrated

for an E- *ange of /deas, on e"ts, /nformation and .no'ledge bet'een aSender and a Re eiver t*roug* +lternative *annels e?g? Sales Presentations,Sales :iterature & B s are t*e e-am"les of Sales ommuni ation

+ !"i al ommuni ation Pro ess *as t*e follo'ing om"onents0

Sour e Sender0 8Salesman '*o "rovides information about Produ t orServi e)

Sour e *as /deas, on e"ts, /nformation & .no'ledge to beommuni ated to +udien e

/deas, on e"ts, /nformation & .no'ledge *ave to be en oded in

"resentable formE?g? Print +ds, B s, Ne's Releases et ?

Re eiver0 8 ustomer)

Re eiver is t*e one for '*o t*e ommuni ation is dire ted at

Re eiver Provides t*e eedba (





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ommuni ation Pro ess is de=ned as a Set of + tivities & S!stems /ntegrated

for an E- *ange of /deas, on e"ts, /nformation and .no'ledge bet'een aSender and a Re eiver t*roug* +lternative *annels e?g? Sales Presentations,Sales :iterature B s are t*e e-am"les of Sales ommuni ation

+ !"i al ommuni ation Pro ess *as t*e follo'ing om"onents0

*annel Medium0 ools or S!stems used to transmit Message 8/deas, on e"ts,/nformation, .no'ledge)E?g? Ele troni and Print Media, /nternet

eedba (0

Re eiver assesses t*e E%e tiveness & Res"onse of t*eommuni ation t*roug* eedba (

E?g? /nterest in Produ t, Pur *ase De isions, ReAe ting an! Sales%er

Noise0 +n! element '*i * a%e ts t*e ransmission or E%e tiveness of

Re e"tion of Message





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ypes of Sales Communication

*ere are 'o !"es of Sales ommuni ation

1?Non Personal ommuni ation

/t in ludes t*e use of Mass Media for "roviding Produ t /nformationMass Media in ludes Ne's"a"ers, elevision, /nternet

*e e%e tiveness of Non Personal ommuni ation is :imited0S o"e of Re i"ients is not (no'n+bilit! to "ersuade ustomers is less

E%e tive in disseminating Produ t /nformation to En*an e t*e :evel of+'areness

2?Personal ommuni ation

E%e tiveness of t*is Medium is Jig*/t ta(es ustomers to Jig* :evel of


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Forms of Communication

*ere are 'o orms of ommuni ation

1?Non Berbal ommuni ation

/t in ludes /nformation '*i * is not in ral & ritten orms

/t is t*e most


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Managing (o!y Language

*e Non Berbal ues ta(en toget*er are alled


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9oise (arriers to Communication

+n! element '*i * a%e ts t*e ransmission or E%e tiveness of Re e"tion of

Message 'ill be ategori ed as Noise

1?P*!si al Noise

Noise Emanating from ele"*ones or om"uters or an! ot*er P*!si albAe ts

2?Ps! *ologi al Noise

/t in ludes antasies, Da!dreams and Mental


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4?Semanti Noise

/t o urs '*en one ver 6 Rea ts to an Emotional Statement

5?Self o us

+ :evel of Preo u"ation 'it* t*oug*ts about oneself

#?Self Defensiveness

/t results '*en "eo"le are t*reatened about t*eir "ositions due to Negativeeedba (Peo"le tend to ma(e arguments and /gnore t*e ommuni ation b! being

Self DefensiveDue to Self o us t*e +ttention :evel be omes :o'

p g g g




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$?E-"eriential Su"eriorit!

/t is found in "eo"le '*o *ave gone t*roug* Baried E-"erien es

?Ego entrism

/t is t*e tenden ! to vie' oneself as t*e enter of ever!t*ing

@?Sele tive Per e"tion

*en Re eiver is not in Same rame of Mind as t*at of Sender due Poor:evel of om"re*ension or Jig* :evel of Distortion

Sele tive +ttention also means t*at "eo"le 'ill "a! more +ttention to/nformation '*i * is of Balue of t*em in t*e Present Situation rat*er t*an'*i * *as :ong erm Relevan e

p g g g




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Listening Skills

:istening is an + tive Sear * of Meaning in t*e Message Re eived

+ good listener 'el omes Ne' /deas, sta!s /nformed, K" to Date and ut ofDanger

E%e tive :istening needs ons ious E%ort and illing Mind

E%e tive :istening su""orts E%e tive Relations*i"s and En*an e E ien !of Sales"erson

p g g g




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ypes of Listening

*ere are *ree t!"es of :istening? *ese t!"es di%er on t*e


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ypes of Listening

3?+ tive Em"at*eti :istening

*e obAe tive of Em"at*eti :istening is understand S"ea(er7s eelings,Needs and Demands

*e "ur"ose is to a""re iate :istener7s Pers"e tive '*et*er 'e :i(e it or

not

p g g g


Chapter 4: Managing Sales Information


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Learning Objectives

Mar(et Sales ore ast and Mar(et Demand Mar(eting De ision Su""ort S!stem /m"ortan e of Sales ore asting *e ore asting Pro ess +""roa *es to ore asting Sales ore asting Met*ods




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Market Sales Forecast an! Market Deman!

Market Sales Forecast# /t is t*e estimated Ru"ee or Knit Sales for aS"e i= uture ime Period based on om"an!7s Mar(eting Plan and an+ssumed Mar(et Environment

/t de"ends on0

/ndustr! Sales *e Mar(et S*are of t*e irm *e 9ro't* Rate in t*e ategor! *e Performan e of Produ t :ine and /ndividual Produ t7s Mar(et

Market Deman!# /t is t*e Sum otal of +ll /ndividual Demand for a Produ t

or Servi e/t de"ends on0

onsumer Preferen es 8+dvertising, /nnovation, *anges on ustoms& raditions)

/n ome :evels of onsumers Pri e of ot*er 9oodsPrepared By: Hamid Ali Raza | Sour e: Sales & !istri"ution #ana$ement "y Tapan %. Panda & Sunil Sahadev | Preston niversity' (slama"ad



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Marketing Decision Support System MDSS'

MDSS is an ngoing, uture riented /nformation Stru ture designed toolle t, ollate, ategori e, Edit, Store and Retrieve /nformation to +id

De ision Ma(ing in an rgani ation7s Sales & Mar(eting Programs

/t involves Problem Solving e *nolog! onsisting of Peo"le, .no'ledge,Soft'are & Jard'are

/t olle ts Data from ransa tion S!stem & +nal!ti al S!stem and "rovide+nal!sis for De ision Ma(ing

+ Baluable MDSS "rovides ast, :ess E-"ensive and more om"lete/nformation for Sales Management De ision Ma(ing

Senior Management an ontinuall! Monitor Sales, Mar(ets, Performan e ofSales Peo"le and t*er Mar(eting S!stems in details

MDSS is .e! for + urate Sales ore asting




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3mportance of Sales Forecasting#

Su ess of


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Sales Forecasting .rocess

/t is de=ned as Series of De isions & + tions in /dentif!ing t*e Salesore asting bAe tives , Determining t*e /nde"endent & De"endent Bariables ,

Develo"ing a ore asting Pro edure and using t*e +vailable Data in t*eSele ted Met*od to Estimate uture Sales

Su""l! *ain Management & Balue *ain Management de"ends onDemand Patterns of Produ t

Sales Forecasting Objectives# Ru"ee Sales, Knit Sales or Number ofSales"eo"le Jired

Depen!ent 7ariables are t*e Bariables '*i * are ore asted 8Ru"eeSales, Knit Sales or Sales"eo"le Jired)

3n!epen!ent 7ariables are t*e Mar(et a tors '*i * in;uen eDe"endent Bariables 8Iuantitative)

Forecasting Met-o!s & Met-o!s# Iuantitative or Iualitative

Sales Forecast is =nali ed and it is Evaluated and Modi= ations are made"y Tapan %. Panda & Sunil Sahadev | Preston niversity' (slama"ad



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$pproac-es to Sales Forecasting

*ere are 'o +""roa *ed to Sales ore asting0

)8(reak Do"n $pproac-

9eneral Environment ore ast0 /t is t*e Stud! of a tors of /nternal &E-ternal Environments t*at in;uen e to a Signi= ant :evels 8Pri ing, Produ t

*anges, Distribution, Promotion, inan ial Resour es, Management S(ills, e *nolog!, E onom! et ?)

/ndustr! ore ast Mar(et Potential0 *e Sum otal of +ll /ndividual Demandfor a Produ t or Servi e or t*e entire /ndustr!

om"an! Sales ore ast0 *e ma-imum Estimated or t*e Potential Salest*at om"an! ma! rea * in a de=ned ime Period under given onditions8Per entage of /ndustr! Sales)

Sales ore ast for t*e Produ t :ines

/ndividual Produ t Sales ore ast"y Tapan %. Panda & Sunil Sahadev | Preston niversity' (slama"ad



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$pproac-es to Sales Forecasting

*ere are 'o +""roa *ed to Sales ore asting0

)8(uil! @p $pproac-

/t is t*e Reverse of t*e


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Sales Forecasting Met-o!s


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)8 ualitative Met-o!s

(8 -e Delp-i Met-o!# *is is an im"rovement on E-"ert "inion Met*od #

9rou" of E-"erts and Del"*i oordinator are sele ted

E-"erts give t*eir ritten Res"onses to oordinator

oordinator "ro esses, om"lies and refers t*em ba ( to Panel Members forRevision 6 t*is "ro ess ontinues for several Rounds 8Ksuall! *ree Rounds)

Pro ess sto"s '*en a onsensus is rea *ed

nl! oordinator 'ill (no' all t*e Members of t*e eam and onl! *e 'ill*ave a ess to all Res"onses and *e runs Statisti al +nal!sis

*e "ro ess aims at 9radual Redu tion of Bariabilit!

*is met*od is 'idel! used for Sales ore asting regardless of om"an!Si e "y Tapan %. Panda & Sunil Sahadev | Preston niversity' (slama"ad



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C8Sales Force Composite# *is met*od is based on t*e fa t t*at individuals'it* Dire t onta t 'it* ustomers 'ill be better informed

rgani ation7s Sales"ersons ome u" 'it* t*eir ore asts

/ndividual ore asts are summed u" to get a verall Demand ore ast fort*e "rodu t

Results an be a%e ted b! t*e0

Sta%


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D8Survey of (uyer’s E pectations# *is met*od is based on Surve! of


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D8/istorical $nalogy Met-o!# *is met*od is used for ore asting t*edemand for a Produ t or Servi e for '*i * t*ere is no Past Data

Mar(eting Personal ma! use Jistori al +nalog! bet'een 'o SimilarProdu ts and derive Demand for Ne' Produ t using Jistori al Data

"y Tapan %. Panda & Sunil Sahadev | Preston niversity' (slama"ad

Chapter 5: Sales Organization


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Learning Objectives Sales rgani ation bAe tives +dvantages of Sales rgani ation a tors /n;uen ing Stru ture rgani ational Prin i"les

S"an of ontrol entrali ation and De entrali ation /ntegration and oordination

rgani ational Design :ine Design rgani ational Design b! erritor! rgani ational Design b! Management un tion rgani ational Design b! Produ t rgani ational Design b! ustomer ombined rgani ational Design

.e! + ount Sales Emerging rgani ational Designs

+gen ! & Distribution Selling S*ared Sales or e elemar(eting

Number of Sales Peo"lePrepared By: Hamid Ali Raza | Sour e: Sales & !istri"ution #ana$ement "y Tapan %. Panda & Sunil Sahadev | Preston niversity' (slama"ad



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Sales OrganiAation

De nition# + Sales OrganiAation is an organi ation of /ndividuals eit*er'or(ing toget*er for t*e mar(eting of Produ ts & Servi es manufa tured b!an enter"rise or for Produ ts t*at are "ro ured b! t*e =rm for t*e "ur"ose ofReselling?

Objectives $!vantages of Sales OrganiAation

Sales rgani ation *el"s to a *ieve oordination among t*e a tivities ofindividuals

Sales rgani ation de=nes t*e duties, roles, rig*ts and res"onsibilities ofSales"eo"le

+ "ro"er Sales rgani ation *el"s in t*e ;o' of bot* u"'ard and do'n'ardommuni ation for ta(ing Sales Related De isions

+ "ro"er Sales rgani ation also removes Du"li ation of E%orts

Sales rgani ation *el"s in a *ieving E%e tiveness and E ien ! 6a *ievin ma-imum Sales ar ets 'it* minimum ostsPrepared By: Hamid Ali Raza | Sour e: Sales & !istri"ution #ana$ement "y Tapan %. Panda & Sunil Sahadev | Preston niversity' (slama"ad



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Objectives $!vantages of Sales OrganiAation

+ Sales rgani ation serves as t*e uni=ed onta t or Relations*i" Point 'it*ustomers

Sales rgani ation ontributes to building t*e morale of Sales"eo"le as t*e!be ome lear about *is "osition, role and res"onsibilities




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Factors 3nGuencing Sales OrganiAational Structure

)8 .ro!uct & Service 2elate! Factors

/n ase of M 9s 8soa"s, oils, toot*"aste) t*e Si e of t*e rgani ation is:arge as a large ustomer base is to be served

rgani ation 'ill be om"le- and :arge in Si e '*en bot* Produ t Mi- andIuantit! in ea * Sale ategor! is :arge




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48 OrganiAation 2elate! Factors

/f t*e Si e of Enter"rise is Small t*en it 'ill *ave limited number of Produ tsand ustomers and a Sim"le Stru ture is re>uired and Bi e Bersa

rgani ations *aving S"e iali ed Produ ts and Serving Ni *e 'ill *ave Smalland Sim"le Sales rgani ation

+n organi ation 'it* :imited inan ial Resour es 'ill "refer to engageintermediaries for distribution and (ee"s Sales rgani ation Sim"le and Bi eBersa

/f organi ation follo's a entrali ed Poli ! for Sales Related De isions t*en

Sales rgani ation 'ill be sim"le and Bi e Bersa




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:8 Marketing Mi 2elate! Factors

Si e of t*e Mar(et also determines t*e Stru ture and Si e of Salesrgani ation

9lobal, /nternational, National Mar(et GGG :arge Sales rgani ation

rgani ations '*i * *ave Sele tive Distribution Strateg! as om"ared to

rgani ations 'it* /ntensive Distribution Strateg! 'ill *ave Sim"le Salesrgani ation

Pri e Poli ! also in;uen es t*e Si e and Stru ture of Sales rgani ation:o' Pri e Produ ts 'it* Jig* Demand and :arge ustomer


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OrganiAational .rinciples

)8 Span of Control

S"an of ontrol refers to number of Subordinates and Sales Sta% under t*eSu"ervision of one Sales Manager

9arro" Span of Control# :ess or :imited Number of Sales Sta% under t*eSu"ervision of one Sales Manager

+""ro"riate Model '*en t*ere are Ne' Re ruits to be *andled in t*e=eldNe' Re ruits learn from E-"erien ed Managers '*en it is ne to ne

oa *ing/t *as follo'ing disadvantages0

om"li ated ommuni ation lo'Demotivation due to Dire t Su"ervisionResistan e b! /nnovative Ne' Re ruits to raditional Met*ods of

oa *ing/solation of Management from 9rassroots :evelsJig*er "erations osts

1i!e Span of Control# :arge Number of Sales Sta% under t*e Su"ervisionof one Sales ManagerPrepared By: Hamid Ali Raza | Sour e: Sales & !istri"ution #ana$ement "y Tapan %. Panda & Sunil Sahadev | Preston niversity' (slama"ad



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48 CentraliAation an! DecentraliAation

*e e-tent of ontrol and +ut*orit! of t*e o" Management versus t*e ieldSales Manager over t*e Sales or e de ides t*e :evel of entrali ation in anorgani ation

CentraliAe! OrganiAation# /n entrali ed rgani ations o" Managementde ides0

Re ruitment, Sele tion, raining, Su"ervisions, i-ation of Iuotas, erritor! +llo ations and om"ensation Plans

onsisten ! in Mar(eting Plans, Kniformit! in Produ ts & Servi es andoordination & /ntegration of Sales Peo"le are t*e +dvantages ofentrali ation

Jel"s in saving Re ruitment, Sele tion, raining and Motivational Planosts

DecentraliAe! OrganiAation# ield Managers ta(e all t*e de isions

/t *el"s rgani ations to be more om"etitive and Res"onsive atres"e tive Mar(et :evels9reater reedom to a tion results in Motivated and Produ tivePrepared By: Hamid Ali Raza | Sour e: Sales & !istri"ution #ana$ement "y Tapan %. Panda & Sunil Sahadev | Preston niversity' (slama"ad

l lChapter 5: Sales Organization


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:8 3ntegration an! Coor!ination

/ntegration and oordination relates to lo' and Kse of ommuni ation andMar(eting /ntelligen e

ra!itional (utter Fly' $pproac-# +ll information ;o's t*roug* t*eSales rgani ation or Sales is t*e onl! K"front De"artment

Mo!ern (o" ie' $pproac-# rgani ation a ross all de"artments isintegrated to serve ustomers

Sales De"artment "rovided information to0

Resear * & Develo"ment for Ne' Produ t Develo"mentSales and Mar(eting De"artments intera t for de iding +dvertising

Poli !, Sales Promotion, oo"erative +dvertising 'it* /ntermediariesSales De"artment also "rovides about inan ial +rrangements, redit

Poli !, redit olle tionoordinates information on om"ensation and Dealer Motivation Plans


O iA i l iChapter 5: Sales Organization


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OrganiAational Design

rgani ational Design refers to0

ormal and oordinated tas( of assigning erritories

Establis*ing of lo's of ommuni ation

Establis*ing Res"onsibilities of Sales 9rou"s and /ndividuals

rgani ations ado"t di%erent (inds of Stru tures e?g?

:ine rgani ationrgani ation Design b! erritor!rgani ation Design b! Management un tionrgani ation Design b! Produ t

ombined rgani ation Design


O iA i l D iChapter 5: Sales Organization


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Line OrganiAation

Small irms *ave :ine rgani ation

*ief E-e utive does t*e De ision Ma(ing and De isions ;o' do'n t*e :inefor e-e ution

*ief E-e utive *as all t*e +ut*orit! over Sales un tion

$!vantages

De isions are made aster, ver*ead osts are :o' and Sales"eo"le needto follo' ommand

Disa!vantages

Sales"eo"le do not *ave time for Sales Planning and are bus! in a *ieving argets set at t*e o"


O iA i l D iChapter 5: Sales Organization


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OrganiAational Design by erritory

rgani ation is designed on t*e basis of 9eogra"*i erritor!

Several +reas are ombined toget*er as erritor! for assigning a Su"ervisorand several erritories are ombined to assign a Sales Manager

$!vantages

ravel imes are :imited and Sales or e remains lose to t*e ustomers

Iualit! of ustomer Servi e is uirements of :evel of om"etition, +rea, Oob andDemandPrepared By: Hamid Ali Raza | Sour e: Sales & !istri"ution #ana$ement "y Tapan %. Panda & Sunil Sahadev | Preston niversity' (slama"ad

O iA ti l D iChapter 5: Sales Organization


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OrganiAational Design by erritory

Disa!vantages

Sales"eo"le *ave to sell entire Produ t :ine in a S"e i= +rea to all !"es ofustomers

Sales"eo"le s"end too mu * time on Produ ts '*i * are easier to sell but

ma! not be Pro=table or "rovide Jig* 9ro't* Potential

oordination is di ult over erritories

*ere is Jig* Probabilit! of on;i t in Resour e +llo ation

*ese "roblems an be solved t*roug*0

lose Su"ervisionPro"er /n entive Stru tureJiring


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OrganiAational Design by Management Function

/t is t*e 9rou"ing of Sales as( a ording to t*eir *ara teristi s

irms need S"e ial E-"ertise for '*i * Selling + tivities are divided intoun tions to be "erformed

Sales PlanningRe ruitment & raining of Sales"eo"le

Su"ervision of Sales Personnel+dvertising un tionSales PromotionSales +nal!sis & Mar(eting Resear *

$!vantages

S"e ial E-"ertise and Su""ort ma(es organi ation "ro=table

S"e iali ation is a *ieved at di%erent :evels of Jierar *!

Res"onse to and De ision Ma(ing on Sales related "roblems is faster


O g iA ti l D igChapter 5: Sales Organization


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OrganiAational Design by Management Function

Disa!vantages

De"enden e on ea * ot*er on Deliver! of inal ustomer Servi e

/ntegration is a *ieved at Jig*er :evel '*i * ma(es t*e Aob of Jig*er+ut*orit! om"le-

/nterde"artmental rivalr! and Non 6 oo"eration issues arise


OrganiAational DesignChapter 5: Sales Organization


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OrganiAational Design by .ro!uct

rgani ations 'it* Diversi=ed Produ t Portfolios "refer Design on t*e basisof t*e !"e of Produ ts

Produ t S"e iali ation is ne essar! '*en "rodu ts are e *ni al andom"le- but om"letel! di%erent from ea * ot*er

$!vantages

lose attention to ea * Produ t in Produ t Portfolio

Sales"eo"le an master all t*e relevant Produ t /nformation

*e interferen e from ot*er de"artments is minimum

Satisfa tion of ustomer is *ig*est as ustomer re eives ma-imumattention




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OrganiAational Design by .ro!uct

Disa!vantages

oordination of Sales fun tion is di ult a ross di%erent "rodu t ategories

*ere an be Du"li ation of E%ort '*en Sales"eo"le from t*e sameorgani ation all same ustomers it in reases ost of selling

"erational ost is *ig* be ause of :arge Number of Em"lo!ees




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OrganiAational Design by Customer

rgani ations 'it* several and distin t mar(ets are designed on t*e ofustomer Pro=les

*ese designs are based on ustomer Pro=tabilit! +nal!sis and BariedServi e Deliver!

Ea * Sales"erson sells entire Produ t :ine to t*e same ustomer

$!vantages

*is design is ustomer Driven and Sales"eo"le gain more .no'ledge onustomer Re>uirements and be ome e-"erts

*is design *el"s in building Su essful ustomer Relations*i"s

Sales and Mar(eting Planning develo"ed de"ending ustomer re>uirementsand be*avior




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OrganiAational Design by Customer

Disa!vantages *is design is e-"ensive to maintain

*ere is fear of Du"li ation of E%ort as ontrolling and oordinatinga tivities are di ult in large =rms




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Combine! OrganiAational Design

Man! organi ations t*at are :arge in Si e and om"le- in Produ t %ering"refer om"le- design

*is design an be a ombination of Produ t, un tion, 9eogra"*! or t*eustomer de"ending on t*e Mar(et overage and S o"e of


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Learning Objectives

Sales erritor!Designing a Sales erritor!

Chapter ): #ana$ement o* Sales Territory


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Sales erritory

De nition# + Sales erritory is a 9rou" of Present andPotential ustomers assigned to an individual sales"erson, agrou" of sales"erson, a bran *, a dealer, a distributor or amar(eting organi ation at a given "eriod of time?

$!vantages of Sales erritory/t ensures better Mar(et overage, E%e tive Ktili ation of Salesor e and E ient distribution of or(load among Sales"eo"le

/t enables Sales Managers to Evaluate t*e Performan e of

Sales"eo"le, ontrol over Dire t and /ndire t osts of Sales un tionand "timum Ktili ation of Sales ime b! Sales Peo"le

Restri ting Sales or e to S"e i= 9eogra"*i +reas *el"s ingenerating more Sales from t*e same area



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Sales erritory

$!vantages of Sales erritory

Sales erritor! ensures t*at Sales"eo"le do not en roa * on ea *ot*er7s erritor!

Restri ting Sales or e to S"e i= +rea *el"s sales"eo"le tounderstand t*e urrent and :atent Needs of ustomers and to servet*em better

Disa!vantages of Sales erritory

+ Sales erritor! ma! not *el" a Ne' Establis*ed rgani ation or'*ere Sales are made t*roug* Personal Relations*i"s

Sales erritor! ma! also not suitable for organi ations '*i * areselling Jig*l! So"*isti ated and e *ni all! om"le- Produ ts

rgani ations '*i * *ave ustomer base distributed over a vast



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Designing Sales erritory

Barious a tors are onsidered '*ile Designing a Sales erritor!

Si e of rgani ation

:evel of om"etition in ea * Produ t ategor!

Number and Iualit! :evel of Produ ts in Portfolio

!"e and Iualit! of Servi es and ustomer Su""ort to be "rovided

Iualit! of Sales"erson serving in t*e rgani ation



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Step )# Select $ppropriate %eograp-ical Control @nit

Small enoug* to allo' le-ibilit! but not so small t*at Jig* :evel ofData om"utation is needed

Jomogenous and of Reasonable si e to a *ieve E onomies of S ale

*e


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Step 4# Criteria

Managers identif! t*e Sales Potential of ea * 9eogra"*i al ontrolKnit based on urrent ustomer


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Step :# Starting .oint

+fter as ertaining Sales Potential in ontrol Knits, a Sales Managers*ould form entative Sales erritories

:o ation Point

rading +rea

:o ation of :arge + ount

entral 9eogra"*i :o ation or State a"ital



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Step =# erritory S-apes

S*a"e of erritor! a%e ts t*e Sales E-"enses and Ease of overageand :ess ime on ravel

1e!ge S-ape!# Ksed b! M 9s '*i * serve bot* Krban andRural +reas

Circular S-ape!# *ese are suitable '*en om"anies *avet*eir a ounts distributed a ross e>uall! si ed areas?Sales"erson is lo ated in entral Part of t*e erritor! and

ravels uniforml! to di%erent areas

Cloverleaf S-ape!# /t is used '*en a ounts are distributedrandoml! t*roug* out t*e erritor!



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Step ?# Control @nits $!jacent to Starting .oint

+fter de iding Starting Point Sales Managers t*en ombine ontrolKnits to build u" Mar(et

Sales Manager (ee"s on running totals on t*e +llo ation riteria forea * ne'l! designed erritor!

*e "ro ess ontinues until all ontrol Knits are assigned to ea *Sales Person

+t t*is :evel, Sales erritories are tentative and ne essar!adAustments an be made in future on t*e basis of S o"e of Mar(et

overage

Chapter : Management of Sales !uota


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Learning Objectives Sales Iuota /m"ortan e of Sales Iuota

Prin i"les of Setting Iuota Pro edure for Setting Iuota !"es of Sales Iuota Met*ods of Setting Sales Iuota

Iuotas


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Sales uota

Sales Iuota are t*e argets 8Sales arget and Duties) t*at Sales"eo"le tr!

to a *ieve 'it*in a S"e i= Period of ime, '*i * ontributes to'ardsa *ieveing t*e rgani ational 9oals regarding Sales ore asts

/t is an e-"e ted Performan e bAe tive

Iuotas are assigned to Sales Knits su * as De"artments, Divisions and/ndividuals


Chapter : Management of Sales !uota


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3mportance of Sales uota

Motivating Sales"eo"le

bAe tivit! in Measurement and lin(ed 'it* Re'ard S!stems eedba ( on Performan e

Management b! E-"e tation

o us on Jig* Performers and ta(ing are of t*eir /nterests o us on Poor Performers and ma(ing e%orts in t*eir S(ill


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.rinciples of Setting Sales uota

bAe tivit!


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.roce!ure for Setting Sales uota

S *edule Planning

Planning for 9oal Setting Meetings E-"laining S!stems, Reasons,


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ypes of Sales uota

Sales Bolume Iuota

Monetar! erms and Knit erms Bariuos Produ t :ines

Sales


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Met-o!s of Setting Sales uota

Iuotas


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Learning Objectives Jiring Pro ess *allenges in Sales or e Sele tion

Sales or e Re ruitment Sour es Sele tion of a Sales"erson So iali ation


/iring .rocessChapter ": #ecruitment & Selection of the Sales $orce


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Turnover

Plannin$

Re ruitment

Sele tion

So ialization

Strate$i Position Analysis

!e ide +o. o* Salespeople to "e hired

(denti*y Sour es o* Re ruitment

,enerate !ata"ase o* Candidates

-valuate Candidates

Sele t and (ndu e

So ailize

/ & !

f l

Chapter ": #ecruitment & Selection of the Sales $orce


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Sources for Sales Forces 2ecruiment

3nternal Sources

:ateral & K"'ard Moves /ntern & oo"erative Students Em"l!ee Referral Programmes

E ternal Sources

t*er /ndustr! Sour es Edu ational /ntitutions and am"us Re ruitments +dvertising Em"lo!ment +gen ies al( /n Net'or(ing eb Sour es


L i Obj i

Chapter 11: Sales $orce Compensation


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Learning Objectives bAe tives of Sales om"ensation Plan *ara teristi s of an E%e tive om"ensation Plan

a tors /n;uen ing t*e Design of om"ensation Plan !"es of om"ensation Plan inan ial om"ensation Non inan ial om"ensation


Obj i f S l C i l

Chapter 11: Sales $orce Compensation


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Objectives of Sales Compensation .lan

+ttra t Iualit! Sales Peo"le

Retaining Iualit! Peo"le and Redu ing +ttrition

/m"rove Prod utivit! :evel

Ma-imise Sales and Redu ing Sales E-"ensed & Produ tion ost

9ood Ra""ort bet'een Sales Managers & Sales"eo"le


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Learning Objectives

Pros"e ting

/dentif!ing Pros"e ts Iualif!ing Pros"e ts 6 M+N

Pre"aring PreFa""roa * all Planning

Presenting +""roa * Probe for Needs onvin e t*e Pros"e t Jandle bAe tions

lose ollo' K"


S lli

Chapter %: he Selling 'rocess


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-e Selling .rocess

/t is a "ro ess b! '*i * a sales"erson

/denti=es and :o ates Pros"e tsSe"arates t*e "ros"e ts from Sus"e ts+""roa *es t*emMa(es a Sales PresentationJandles t*eir bAe tions

lose a SaleJe also ollo's K" 'it* t*e E-isting ustomers to /dentif! furt*erSales :eads, Measure Su ess and ustomer Satisfa tion :evel of

urrent Produ ts & Servi e %erings


S lli g



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-e Selling .rocess


rospecting



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.rospecting

/t is a "ro ess b! '*i * a sales"erson

/dentif! Potential


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.rospecting

De ne arget Market

Determining t*e t!"e of Person or rgani ation '*i * is most li(el! tobu! a Produ t or Servi eSales"erson an be *el"ed b! Resear *ers, Produ t Managers, Mar(etPlanners and Sales Managers for De=ning arget Mar(etNet'or(ing

Mar(et Surve!

%enerate Sales Lea!s

+ Sales :ead is an! S"e i= Person or rgani ation t*at mig*t Need agiven Produ t or Servi e

ualifying .rospects

Iualif!ing means0 9ee! and or Desire to (uy GG Financial2esources GG $ut-ority

M$9# Money H $ut-ority H 9ee!Prepared By: Hamid Ali Raza | Sour e: Sales & !istri"ution #ana$ement "y Tapan %. Panda & Sunil Sahadev | Preston niversity' (slama"ad

rospecting



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.rospecting

3!entifying .rospects

Present ustomers ormer ustomers old alling S"otters Dire tories and Mailing :ists

Pros"e ting Servi es

Referrals enter of /n;uen e +""roa * Endless *ain Pros"e ting

Personal onta ts rade S*o's and E-*ibits Dire t Mar(eting

Final Sales & Distribution Management

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