This document discusses key concepts related to sales budgets, quotas, territories, and control. It defines a sales budget as an estimate of sales volume and expenses set slightly lower than forecasts. Sales budgets are prepared by product, territory, salesperson, and customer. Quotas and territories are used to set performance standards, control results, and motivate teams. Territories assign exclusive areas to sales teams to reduce conflict and efficiently allocate resources. Control processes compare actual performance to targets and analyze expenses to ensure budget and objective achievement.

1. SALES BUDGETS, QUOTAS, TERRITORY AND CONTROL
DEEPAK SINGH
PCTE LUDHIANA
Sales Budgeting

2. What is Sales Budget?
An estimate of volume of sales and selling
expenses
Sales volume: based on sales forecast, but kept
slightly lower than sales forecast
Sales budget is prepared:
 Product wise
 Territory wise
 Sales person wise
 Customer wise

3. Why prepare sales budget?
Planning
 Predicting profits
 Assigning targets to team
 Planning production/ allocation of resources
Coordination
 Keeping all departments and teams on same page
 Leveling expectations
 Clarifying requirements
Control
 Monitoring actual Vs targets
 Corrective actions

4. Sales Budget Process
Text book proposed process:
Situation review
 Past performance, current situation
Central communication
 Formats, guidelines, timelines
Subordinate budgets
 Consolidates to national budget
Approval of sales budget
Communication of budget to all
Practical process: ?

5. Sales quotas/ Sales targets
Sales quotas are goals set by a company for its
marketing unit (city, area, territory, team, etc) for a
certain period of time
SQ can be on the basis of:
 Unit sales
 Profit margin
 Activity
 Expenses
 Customer satisfaction index
 etc

6. Why set Sales targets/ Sales Quotas?
Setting a performance standard for comparison
 Where do I stand?
Controlling performance
 Identifying loss making activities/ areas
Motivating people
 Rewards on achievement
 Performance linked incentives
Identifying strengths and weaknesses
 Scope for training
 Change of role
 Mentoring and benchmarking

7. Types of Sales Quotas
Sales Volume
 Rs sales - HUL
 Unit sales – CAT
 Point sales volume – paints companies points system
Financial Quota
 Profitability targets – ICICI Lombard
Combination Quota
 Almost all companies

8. Sales Territory
An exclusive (mostly) territory assigned to a
marketing/ sales team where no other member from
the company directly competes with the concerned
team.
Sales territory can be:
 Geographic – city, state, area, etc
 Type of industry: IT, Banking, Petroleum, etc
 Type of customer – corporate, retail, SME, etc
Helps reduce infighting in company
More efficient allocation of resources
E.g. Car insurance for Bentley of DHFL Chairman

9. Sales Control and Cost Analysis
Achievement of budgets and company objectives
Planning and executing corrective measures
Monthly/ Quarterly sales review
 Relation review to Vertical review
Introduction of stimulus measures
Impact on net profitability
Analysis of returns on sales expenses

10. Thank You