Salesmpp1

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Salesmpp1

  1. 1. SALES MANAGEMENT (PART-I) CORE TEXT: “SALES MANAGEMENT” BYSTILL, CUNDIFF & GOVONI MODULE TUTOR: PROF. HIMMAT ADISARE
  2. 2. SALES MANAGEMENT Definition: “Sales Management is the planning, direction, and control of personal selling, including recruiting, selecting, equipping, assigning, routing, supervising, paying, and motivating, as these tasks apply to the personal sales force.” (continued)
  3. 3. SALES MANAGEMENT SCOPE, OBJECTIVES AND FUNCTIONS
  4. 4. SALES MANAGEMENT: SCOPE, OBJECTIVES & FUNCTIONS• Scope and Objectives: Sales Management is responsible for organizing the sales effort, both within and outside the company. Sales Management participates in evolving key marketing decisions pertaining to budgeting, sales quota & territories, products, marketing channels, distribution policies, advertising, sales promotion, and pricing.• The three Objectives: i) Achieving Sales Volume ii) Contribution to Profits, and iii) Continued Growth. (continued)
  5. 5. SALES MANAGEMENT:SCOPE, OBJECTIVES & FUNCTIONS Functions of Sales Management: Sales Management is responsible in performing six important functions: Planning Organizing Staffing Directing Controlling Coordinating (continued)
  6. 6. FUNCTIONS OF SALES MANAGEMENT1. Planning: Marketing programs involve plans for achieving predetermined sales, profit, and growth objectives. Sales Management is required to determine the elements that make up the marketing program such as personal selling, advertising, mail- orders etc., and plan for the proportion of each element in the marketing program. (continued)
  7. 7. FUNCTIONS OF SALES MANAGEMENT Organizing: There are different order-getting departments: personal selling, mail-orders, advertising, telemarketing etc. The Sales Manager has to organize these departments in a manner that will ensure that they are not working at cross-purposes. Intra-department and Inter-department communications need to be well organized. (continued)
  8. 8. FUNCTIONS OF SALES MANAGEMENTStaffing (personnel Function): This involves the selection, recruitment, training, and motivation of the sales force. Different products, markets, and territories will require different types of sales people. The Sales Manager has to identify and recruit the appropriate type of sales people required for these different categories. (continued)
  9. 9. FUNCTIONS OF SALES MANAGEMENTDirecting: Once the proper sales force has been recruited and trained, Sales Management is responsible for directing and motivating the sales force to achieve the objectives of the planned marketing program in terms of predetermined sales, profit, and growth objectives of the company. (continued)
  10. 10. FUNCTIONS OF SALES MANAGEMENT Control Function: In Sales Management control is exercised by the following methods: a) Setting quantitative performance criteria against which performance can be measured. b) Collecting and processing data on actual performance of the sales force. c) Measuring and evaluating the performance of the sales force individually and as a team. d) Taking action to correct controllable variations. e) Making adjustments for uncontrollable variations. (continued)
  11. 11. FUNCTIONS OF SALES MANAGEMENT Co-ordination: The Sales Manager has three important co-ordination functions: a) Co-ordination with other elements in the marketing program i.e. synchronizing with advertising, P of P displays, alerting dealers & retailers of various promos and schemes. b) Co-ordination with the distributor network in terms of product distribution, dealer identification for customers, and reconciliation of business goals. c) Co-ordination and implementation of the overall marketing strategy.This may involve a new product launch, entering new market segment, repositioning etc.
  12. 12. SALES MANAGEMENTPERSONAL SELLING
  13. 13. PERSONAL SELLING THE BUYER-SELLER INTERRELATIONSHIP Salesperson START Customer Salesperson-Customer Relationship Role Personal Personal Role requirement characteristics characteristics requirementcharacteristics characteristics PERSONAL AFFILIATION Needs and Needs andexpectations ADJUSTMENT expectations NEGOTIATIONChoice of Choice of ADAPT ADAPT strategystrategy EXCHANGE Experience STOP Experience
  14. 14. PERSONAL SELLING Diverse/Different Selling Situations: Sales situations can be categorized into three mutually exclusive groups as under: GROUP “A”: i) Inside Order Taker: Example-Sales clerk behind the counter. ii) Delivery Sales Person: Example-Newspaper salesman, milkman. iii) Route or Merchandizing Sales Person: Operates as an order- taker but works in the field. Example-Sales person for soaps, cosmetics, household goods, taking orders from retailers. iv) Missionary Sales Person: The aim is to build goodwill and educate the potential or actual user. Example-Sales person in the pharmaceutical industry. v) Technical Sales Person: Here, the emphasis is on technical knowledge. Example-The Sales Engineer, who is primarily a consultant to the client. (continued)
  15. 15. SALES MANAGEMENT PERSONAL SELLING Diverse/Different Selling Situations: GROUP “B”: i) Creative Sales Person for Tangibles: Example-Salesperson selling automobiles, two- wheelers, washing machines, etc. ii) Creative Sales Person for Intangibles: Example-Salesperson selling insurance, education programs, advertising services etc. (continued)
  16. 16. SALES MANAGEMENT PERSONAL SELLING Diverse/Different Selling Situations: GROUP “C”: i) “Political”/“Backdoor” Sales Person: This type sells “big deals” for items with no truly competitive features. Example-Large Government contracts/supplies. ii) Sales Person for Multiple Sales: This involves making presentations of the same product or service to several audiences where only one person can say “yes”, but all the others can say “no”. Example-Accounts Executive of an Advertising agency.
  17. 17. SALES MANAGEMENT THE EFFECTIVE SALES EXECUTIVE
  18. 18. THE EFFECTIVE SALES EXECUTIVE Introduction: Some sales jobs require little more than enormous energy and drive. Others require great perception, some others require special knowledge of the technologies associated with the product, some jobs call for commercial flair and negotiating skills, while some call for adaptability in strange and alien environments. All these varying profiles require seven essential prerequisites to define a salesperson as effective and successful. (continued)
  19. 19. THE EFFECTIVE SALES EXECUTIVE The seven essential prerequisites: i) Sales perception ii) Initiating relationships iii) Maintaining relationships iv) Degree of self-motivation v) Acceptance of motivation from others vi) Planning time and use of sales-aids vii) Selling in widely different environments
  20. 20. SALES MANAGEMENT RECRUITINGSUCCESSFUL SALES PEOPLE
  21. 21. RECRUITING SUCCESSFUL SALES PEOPLE Introduction: Selecting a team is often the highest value decision for any Sales Manager. A checklist of questions in chronological sequence for the selection and recruitment process should be used as follows: i) What is the job to be filled? ii) What sort of person would do this job successfully? iii) Where will this person be found? iv) What methods will be used for applicants to respond? v) Which person should be selected and how? vi) How should the selected candidate be recruited successfully? (continued)
  22. 22. RECRUITING SUCCESSFUL SALES PEOPLE It is vital to be clear about the job requirements and the kind of person who would do it best. The questions in the checklist should be addressed as under: i) What is the job to be filled? The job description must include the following features: a) The name of the job. b) Who is the boss? c) Why the job exists-its objectives? d) How far the job holder is personally responsible for achieving results ? e) Control & use of people, materials , and money. (continued)
  23. 23. RECRUITING SUCCESSFUL SALES PEOPLEii) What sort of person would do this jobsuccessfully? The following areas have beentried and tested in drawing up specifications forsales appointments: a) Intellectual abilities b) Skills with people c) Maturity d) Motivation e) Specific attainments f) Working conditions (continued)
  24. 24. RECRUITING SUCCESSFUL SALES PEOPLEiii) Where will this person be found? There are a varietyof sources available: a) Employment agencies b) Recruitment and search agencies c) Word-of-mouth d) Personal recommendation e) Through advertisements f) Company’s own data bankThe choice will depend on the nature of the job and onhow many potential candidates are required. (continued)
  25. 25. RECRUITING SUCCESSFUL SALES PEOPLEiv) What methods will be used for applicants torespond? Various methods are available for initialscreening, short-listing, and final selection. Some ofthese are listed below: a) Telephonic screening b) Advertising and asking for C.V.s c) Getting potential candidates to fill up application forms with questions specifically related to the job d) Open-house/walk-in interviews (continued)
  26. 26. RECRUITING SUCCESSFUL SALES PEOPLEv) Which person(s) should be selected and how? Aninterview is an unreliable method unless it is carefullyplanned, structured, and supported with additionalinformation. The following areas be covered in astructured interview: a) Education b) Work history c) Family background d) Domestic and financial situation e) Health f) Leisure interests g) Ambitions h) Future plans (continued)
  27. 27. RECRUITING SUCCESSFUL SALES PEOPLEvi) How should the selected candidate be recruitedsuccessfully? The following aspects should be kept inmind: a) Handle negotiations on remuneration withflexibility depending on the deserving level of theselected candidate. b) Answer candidates’ queries candidly. c) Inform selected candidates as early as possible. d) Keep an administrative follow up with selectedcandidate regarding joining date, accommodation,travel arrangements etc.Keeping these aspects in mind, it is feasible to select andrecruit a team that would be an asset to the company.
  28. 28. SALES MANAGEMENTMOTIVATING THE SALES TEAM & MOTIVATION PROGRAMS
  29. 29. MOTIVATING THE SALES TEAM & MOTIVATION PROGRAMS Introduction: Once an organization has recruited a good sales team, it is essential to keep the team at a high motivational level in order to achieve the desired targets and objectives of the organization. Motivation is achieved by a combination of numerous factors that ensure a high degree of achievement and satisfaction within the sales team. Some of the aspects that are important for motivating the sales team are as under: (continued)
  30. 30. MOTIVATING THE SALES TEAM & MOTIVATION PROGRAMSAs a Sales Manager: 1. Consider the following: Performance = Motivation x Ability This highlights the fact that even average performers can achieve good results if the motivation factor is high. (continued)
  31. 31. MOTIVATING THE SALES TEAM & MOTIVATION PROGRAMS2a)Consider the de-motivators:i) Selling is a low status job.ii) The sales person works in “enemyterritory”.iii) The sales person works alone.iv) The sales person has to endureconsiderable “ego punishment”. (continued)
  32. 32. MOTIVATING THE SALES TEAM & MOTIVATION PROGRAMS2b) Analyze how motivation theories can helpthe salesperson perform best by identifyingthe dominant motivators from those givenbelow:i) Power ii) Achievementiii) Money iv) Social acceptancev) Status vi) CompetenceThis identification can effectively suppress thede-motivators. (continued)
  33. 33. MOTIVATING THE SALES TEAM & MOTIVATION PROGRAMS3. Outline a managerial action plan formotivating the sales force:i) Give status rewards.ii) Pay special attention to new recruits.iii) Arrange frequent sales meetings.iv) Help sales persons to handle rejection.v) Be available and understanding. (continued)
  34. 34. MOTIVATING THE SALES TEAM & MOTIVATION PROGRAMS4a) Plan realistic motivation programs on theapplications given below:i) Boosting sales during a slack season.ii) Ensuring maximum effort during a seasonal peak.iii) Achieving maximum sales of a product that isshortly to be replaced by a new one.iv) Concentrating efforts on a particular brand/modelwithin a product range.v) Increasing the call rate on new accounts.vi) Ensuring maximum effort is put behind a newproduct launch.vii) Getting distribution in a new range of outlets. (continued)
  35. 35. MOTIVATING THE SALES TEAM & MOTIVATION PROGRAMS4b) While mounting a motivation program keep thefollowing factors in mind:i) Cash incentives are not always the best reward.ii) Incentives will differ from each type of sales job.iii) The presentation of the rewards/incentives must be stage-managed well to inject excitement andinspiration.iv) The rewards and incentives must be memorable,ensure recognition at all levels in the Company,and must include the family of the salesperson.v) Timing, budgeting and target-setting of program. (continued)
  36. 36. MOTIVATING THE SALES TEAM & MOTIVATION PROGRAMS4c) Tax-effects/other effects on the normal income ofthe salesperson have to be borne in mind:i) The company should shoulder the tax-liability forall expenses forming part of the motivationprogram/incentive scheme.ii) Flexibility in incentive scheme should be clearlyspecified e.g. up to what fiscal level the company willbear expenses, beyond which, the salesperson wouldhave to bear tax for additional expenses.In conclusion, motivation programs have to be well-planned, well-orchestrated, and implemented in amanner that ensure effective sales results.
  37. 37. SALES MANAGEMENTWORKING THE TERRITORY
  38. 38. WORKING THE TERRITORY Introduction: Every salesperson is allocated sales targets that are to be achieved in an assigned territory. To effectively achieve these targets, the sales person needs to manage time in an efficient manner by planning daily sales calls in the given territory. (continued)
  39. 39. WORKING THE TERRITORY 1. Managing Time: Time management is not easy. We are living in a period of accelerating change. The speed and scope of communication mean a faster reaction time and an increased tempo of both business and life in general. It is useful to analyze how time is spent. This can be done by breaking down the week into hours spent in the activities shown in Chart No.1. A similar examination should be made of paid work and travel. The categories of time usage will vary depending on the type of job. The categories of time usage can be analyzed as shown in Chart No.2. (continued)
  40. 40. WORKING THE TERRITORY CHART NO.1 (MANAGING TIME) ACTIVITY MON TUE WED THU FRI SAT % OF TOTAL1. PAID WORK2. OTHER WORK3. TRAVEL4. LEISURE TIME5. EATING,WASHING ETC.6. SLEEP (continued)
  41. 41. WORKING THE TERRITORY CHART NO.2 (MANAGING TIME)CATEGORIES OFTIME USAGE MON TUE WED THU FRI SAT TOTAL1. SELLING TIMEWITH DECISIONMAKERS2. SELLING TIMEWITH INFLUENCERS3. PROSPECTING4. REPORTING &ADMINISTRATION5. WAITING TIME6. OTHER PAIDWORK/ACTIVITY
  42. 42. WORKING THE TERRITORY2. Planning the Territory: The most complex aspect of organizing the salesperson’s time efficiently is the planning of the territory. Although there are several methods, planning the territory can be managed by a simple nine-step process. (continued)
  43. 43. WORKING THE TERRITORY (PLANNING THE TERRITORY) The nine-step process: 5. Divide the territory into1. Identify all the existing and five or six areas of potential accounts to be workload, by the number of calls. visited. 6. Group the calls into2. Assign to each account an units representing one intended call frequency. days workload.3. Check the workload against 7. Ensure sufficient time capacity and adjust if for prospecting. necessary 8. Run the proposed system4. On a large-scale map, locate for a month. Readjust each account. Color-code the daily allocations if accounts for call frequency. required. 9. Review quarterly, or as required. (continued)
  44. 44. WORKING THE TERRITORY PLANNING THE TERRITORYThe figure below depicts how territory planning can be done forsix sectors, each asterisk depicting one account and each sectordepicting one days workload: * MON * TUE * * * * * * * * * * WED SAT * * * * * * * * * THU * * * FRI HOME * * * * *
  45. 45. WORKING THE TERRITORY 3. Route Planning: Economy in travel time can be achieved by territory planning. The key feature to such planning is the concentration of activity within a small area. However, even within this area, traveling time and distance can be kept to the minimum by using the “PETAL” system rather than by working one’s way out and driving straight back home. (continued)
  46. 46. WORKING THE TERRITORY ROUTE PLANNINGTHE FIGURE BELOW ILLUSTRATES THE ECONOMICAL “PETAL” SYSTEM 8 6 4 5 7 2 3HOME 1 PETAL SYSTEM LONGER ROUTE
  47. 47. WORKING THE TERRITORY 4. Other areas where time can be saved: To reduce loss of time, the salesperson should be trained in the following activities: a) Forward weekly or fortnightly sales plans. b) Maintain telephonic/e-mail contact with HQ rather than visiting personally. c) Make appointments strategically. d) Plan presentations in advance. e) Reduce administration & reporting time.
  48. 48. SALES MANAGEMENTTHE SALES ORGANIZATION
  49. 49. THE SALES ORGANIZATION Introduction: In order to achieve the sales objectives of the organization, it is essential to develop a properly structured, coordinated, and motivated sales department with well- defined lines of authority. The present day market conditions being highly competitive, the modern day Sales Organization has to be designed on sound foundations. (continued)
  50. 50. THE SALES ORGANIZATION 1. Sales Organization in the Modern Age: For any S.O. to be effective, the following aspects are essential: a) Achieving both qualitative & quantitative personal-selling objectives. b) Inculcating the right mix of profit-mindedness and sales- mindedness in the S.O. c) Making the S.O. an orientation point for cooperative endeavor and a structure of human relationships. d) Developing a cohesive formal & informal relationship within the S.O. e) Keeping the S.O. adaptable and flexible to changing market situations, competition and other factors in the economy . (continued)
  51. 51. THE SALES ORGANIZATION2. Purposes of the Modern Day S.O. In the ideally organized S.O. there would be no duplication of efforts, least friction among the sales staff, and maximum cooperation. To achieve this, the S.O. must be clear about the purposes of its formation. Five major purposes can be clearly identified as follow: (continued)
  52. 52. THE SALES ORGANIZATION PURPOSES OF THE MODERN DAY S.O. 1. To permit the development of specialists. 2. To ensure that all necessary activities of sales are performed. 3. To achieve coordination and balance. 4. To define authority. 5. To economize on executive time. (continued)
  53. 53. THE SALES ORGANIZATION PURPOSES OF THE MODERN DAY S.O. 1. To permit the development of specialists: This is achieved by delegation of authority for specific tasks to specific salespersons most suited for these tasks. It is from this approach that the S.O. develops specialists in various sales functions. For example: a) Presentation skills b) Product knowledge (continued)
  54. 54. THE SALES ORGANIZATION PURPOSES OF THE MODERN DAY S.O. 2. To ensure that all necessary activities of sales are performed: As an organization grows, the S.O. also expands & specialization increases. This results in a greater number of sales activities. When tasks are highly specialized, the danger exists that the S.O. does not provide for supervision of all activities. At this juncture, the S.O. must provide for executives specializing in CRM so that no essential activities are omitted. (continued)
  55. 55. THE SALES ORGANIZATION PURPOSES OF THE MODERN DAY S.O. 3. To achieve coordination and balance: The sum of a combined effort will exceed the individual efforts of the sales team members. Motivating individuals to work toward common objectives is important in achieving coordination and balance. By getting people to pull together as a team, the S.O. can accomplish more collectively than its members could individually. (continued)
  56. 56. THE SALES ORGANIZATION PURPOSES OF THE MODERN DAY S.O. 4. To define authority: Every person in the S.O. must be clear as to whether his/her authority is line, staff, or functional. Line authority indicates power to execute orders by those even in the lower organizational hierarchy. Staff authority is the power to suggest methods of implementation of orders to those with line authority. Functional authority indicates power given to specialists to assist those with line authority. (continued)
  57. 57. THE SALES ORGANIZATION PURPOSES OF THE MODERN DAY S.O. 5. To economize on executive time: As the activities of the S.O. increase, additional subordinates are recruited. This permits high ranking executives to delegate more authority. However, coordination is of prime importance to ensure that subordinates work in harmony. Hence, the “span of control” even if wide, must be controllable. If proper, capable, and trained subordinates are recruited to monitor routine activities and problems of the sales force, there would be economies achieved in the use of executive time. Thus, senior executives would get more time for planning. (continued)
  58. 58. THE SALES ORGANIZATIONCLASSIFICATION & STRUCTURES OF S.O. FIG.1: LINE SALES ORGANIZATION GM (SALES) SALES MANAGER ASM ASM ASM ASM DIV-I DIV-II DIV-III DIV-IVSalespeople Salespeople Salespeople Salespeople (continued)
  59. 59. THE SALES ORGANIZATIONCLASSIFICATION & STRUCTURES OF S.O. FIG.2: LINE AND STAFF SALES ORGANIZATION VP (MARKETING)STAFF GM (SALES) FUNCTIONALMGR (ADVTG & PR) MGR (LOGISTICS) ASM-I ASM-II ASM-III Salespeople Salespeople Salespeople
  60. 60. SALES MANAGEMENT THANK YOU FOR YOUR PARTICIPATION END OF PART-I CONTINUED AS PART-II

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