1. SALES BUDGET, QUOTASSALES BUDGET, QUOTAS
ANDAND
SALES TERRITORIESSALES TERRITORIES
PRESENTED BY:
INDRANSH GUPTA
JATIN ARORA

2. SALES BUDGET
 Estimates of expected volume of sales and selling
expense.
 Sales volume of sales budget is based on sales
forecast.
 Sales Budget is slightly lower than the sales
forecast.
 Suggest the importance of sales forecasting and
sales quotas for territory management.

3. SALES BUDGET
 Design the product-wise / brand-wise sales
planning for a company,
 Design an effective territory planning for the sales
force,
 Plan the total expenses on effective coverage of
your area,

4. SALES BUDGET:
 financial plan depicting how resources should be
allocated to achieve the forecasted sales.
THE PURPOSE OF SALES BUDGETING:
 plan for and control the expenditure of resources
(money, material, people and facilities)
 necessary to achieve the desired sales objectives
that have been set on the basis of sales forecasts.

5. WHY SALES BUDGET
 PROFIT PLANNING
 based on expected sales less cost of achieving the sales.
includes sales goals, strategy & action plan
 cost of expected plan is based in sales quota; production;
territory; customer & selling price.
 CO-ORDINATION
 B/w all deptts. i.e. marketing, finance, production,
human resource etc.

6. WHY SALES BUDGET
 CONTROL
 Tool for evaluation of performance.
 In term of standard sales volume & selling expenses
against actual performance.
 Yearly Budget is broken => Quarterly => Monthly.

7. METHODS USED FOR DECIDING SALES
EXPENSE BUDGET.
1. % OF SALES METHOD
2. EXECUTIVE JUDGMENT
3. OBJECTIVE AND TASK METHOD

8. SALES BUDGET PROCESS
 REVIEW SITUATION:
 reviews past, present & future (budget period).
 COMMUNICATION:
 writing to all field office regarding formats, guidelines, assists
and time about all three budgets.
 SUBORDINATES BUDGETS:
 sales managers prepares sales budget for their respective sales
territory and submits it to national sales manager
 National sales manager prepares the companies proposed
sales budget by combining the received budget.

9. SALES BUDGET PROCESS
 APPROVAL OF THE SALES BUDGET:
 consulting marketing head; national sales manager prepares 2/3
alternative proposals of sales budget
 Sales budget is presented to top management.
 OTHER DEPARTMENT:
 Final sales budget given to other department to prepare are their own
budgets.
 sales budget is broken down into each sales territory quarterly and
monthly.
 A/c’s deptt. prepares cash budget and profit budget based on sales
revenue information given by sales department and expenses budget
given by other departments.

10. Sales Quota
 goals set by co. for marketing unit for specific period.
 Marketing unit may be regions, territory, branch,
salesperson, a distribution or a dealer.
 can be set on sales unit, expenses, profit margin,
activity, customer satisfaction etc.
 Annual sales quota for each unit - broken down to
quarterly/monthly.

11. Objectives of Sales Quota
Making available performance standard:
 act as a tool to measure performance of sales
person, act as a goal/target setter.
 Performance standard set against which actual
performance is compared to evaluate salespersons
performance.

12. Objectives of Sales Quota
Controlling performance:
 By setting quotas for special activities, sales volume & selling expenses.
 The SM (sales manager) controls performance. Fore.g:-10 calls per
day i.e. 5 calls of business customer’s indirectly monitors/controls the
activities of sales person by setting quotas.
 Can keep an eye on wasteful expenditure on customer (travelling,
lodging, entertainment & meals)
 Control over reporting &can influence sales performance.

13. Objectives of Sales Quota
 Motivating people:
 Sales quotas are set by motivating sales people by money.
 performance is recognized by awards/rewards like trips
abroad.
 financial compensation/ rewards are called incentives.
 incentives linked with quotas which are made achievable
for sales person. So that he puts in extra effort to achieve
his quota.

14. Objectives of Sales Quota
 Identifying strength &weakness:
 Actual performance compound respective quotas of
difference territories & salespersons.
 The SM can identify successful &unsuccessful
performance.
 Analysis of causes of poor performance may reveal
training program needs improvement, better product
quality required to meet customer needs & positioning
strategy.

15. Types of Sales Quota
Sales Volume:
1) Rs. sales volume:- many product easier to manage
(HUL)
2) Unit Sales volume: - Sets sales volume in units. E.g.
machinery/ milk/ petrol.
3) Point sales volume: - When company wants to make
profit will target.

16. Types of Sales Quota
Financial Quota:
 Gross- margin/profit: Gross margin quota is decided
by ‘cost of goods sold’ from sales volume.
 Expense quota: Companies control over in cost of selling
(travelling), control over expenses along with sales volume
quota, SO that selling expenses are kept in line.
E.g. Pantaloon -“Garv se kaho Hum kanjus hai”

17. Types of Sales Quota
Activity Quota:
 Direct sales person to carry out job related activity.
- Defining important activity
- Finding out time required for carrying out activity
- Deciding priority given to carry out activity.
- Deciding quota/ frequency for important activity.

18. Types of Sales Quota
Combination quota:
 Selling activity &non-selling activities,
 uses point as common measure to overcome the
problem of difference measures used by various
quotas discussed earlier.

19. Methods for setting Quotas
1) Territory potential
2) Part sales expenses
3) Total marketing estimates
4) Executives judgment
5) Salespeople’s estimates
6) Compensation plan

20. SALES TERRITORY
 group of customer accounts, an industry, a market or a
specific geographical area, assigned to a specific
salesperson.
 factors that influence sales volume of a territory are
territory size, its market potential, number of customer
accounts, firms experience and market share in the
territory, quality of salesperson assigned and the
frequency of sales call made.

21. GOALS
1) Proper Market Coverage
2) Effective Development of Sales Force
3) Efficient Customer Service
4) Objective Evaluation of Sale Force
5) Improving Selling and Marketing Productivity

22. STEPS IN TERRITORY PLANNING
1) Salesperson’s Capacity
2) Frequency of Calls per Month
3) Parity in Sales Potential
4) Minimise Travel Time & Expenses
5) Suitably Station the Salesperson

23. Improving Territory
Productivity
 clarity of approach to account development, as
well as to small/marginal customer,
profit generators and detractors in the territory
allocation of sales, marketing and other resources
based on territory’s contribution potential
effective utilisation of sales force time.

24. Vardhman
 Sales Budget made based on pending orders, capacity and
product lines free.
 Sales Territory set according to branches : Delhi, CMY,
Mumbai etc.
 Sales Quota is Product-wise.
Eg: 300 tons to be sold.
150 in Domestic Market
150 to be exported
Further divided according to products.

25. THANK
YOU