FSM 5th Unit

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SALES PLANNING AND CONTROL

-BY

D.Ganesh

20098

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Marketing Plan

Sales Forecasts Sales Force Budget

PLANNING/FORECASTING/BUDGETING SEQUENCE

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SALES BUDGET

The sales force budget is the amount of money available or

assigned for a definite period, usually one year.

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BUDGET PURPOSES

Planning

Coordination

Control

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Types of Budget

Sales budget

It gives a plan showing the expected sales for a specified period

in the future.

Selling expenses budget

It is a budget gives a plan showing the expected sales for a

specified period in the future.

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Administrative expenses budget

It specifies the budgetary allocations for general administrative

expenses that would be incurred by the sales department.

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Methods For Budgeting

The different methods for budgeting include the-

Affordability method

Percentage-of-sales method

Competitive parity method

Objective-and-task method

Return-oriented method.

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Information Drives Management

Decision Making and Planning

Sales forecasts

Territory estimates

Quotas

Sales force size

Sales territory design

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Sales budget

Production budget

Direct labor materials

and overhead budgets

Cost of goods sold budget

Budgeted profit and loss

statement

Sales and

administrativeexpense budget

Revenue budget

Sales forecasts

Impact of Sales Forecasts on Budgeting

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Choosing a Forecasting Method

Which forecasting method should be used and

how accurate is the forecast likely to be?

In general, the various forecast comparisons

suggest that no method remains superior underall conditions.

Good forecasters apply multiple forecasting

methods to the problem

Scenario planning prepares a series of what-ifquestions and produces possible outcomes

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Developing Territory Estimates

Territory estimates effect:

The design of sales territories

Procedures for identifying potential customers

The establishment of sales quotas

Compensation and its subcomponents

The evaluation of salesperson performance

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Sales Quotas

Goals assigned to salespeople

Apply to specific periods and may be expressed

in dollars or physical units

Tool for sales managers planning and controlling

field selling activities and results

Benchmark for evaluating sales effectiveness

Motivate sales people

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Determining Sales Force Size

Salespeople are among the most productive assets of a company,

and they are also among the most expensive!

How can an optimal sales force be established?

Breakdown method:

Number of salespersonnel needed =

Sales Volume

Productivity

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Determining Sales Force Size

Workload method uses the buildup method to estimate the

work required to serve the entire market

Incremental method suggests that sales representatives

should be added as long as the incremental profit produce by

their addition exceeds the incremental cost

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Sales Analysis

Simple sales analysis - facts are listed and not

measured against any standard

Bases for sales comparison

Quotas

Comparative sales forecast

Forecast vs. actual

Reports can focus on exceptions or significant

deviations from the financial norms or budget.

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