This document discusses key aspects of sales management, including: 1) Sales management involves planning, directing, and controlling the personal selling function including recruiting, training, and motivating the sales force. 2) The objectives of sales management are to increase sales volume, profits, and business growth. 3) Effective sales management requires forecasting sales, setting quotas, motivating the sales team, and planning sales activities.

1. SALES MANAGEMENT
The only business
function that
generates revenue.
1

2. SALES MANAGEMENT
Planning, direction and control of personal selling
including recruiting, selecting, training, equipping,
assigning, supervising, compensating and motivating as
these tasks apply to the personal sales force.
2

3. SALES MANAGEMENT
Management of the personal selling task.
Is there anything like ‘impersonal selling’ or ‘non-personal’
selling?
Selling is an exchange transaction. Exchange of Product or service
for money
Money is the revenue or the earnings of an enterprise often called
‘turnover’ or ‘top line’
Sales therefore is the only revenue generating function in an
enterprise.
3

4. OBJECTIVES OF SALES
MANAGEMENT
3 general underlying objectives:
1. SALES VOLUME
2. PROFITS
3. GROWTH
Sales – cost of sales = gross margin.
Gross margin – expenses =net profit.
4

5. SALES MANAGEMENT:
EVOLUTION
Industrial Revolution – 1760
Small home industries – Large scale manufacturing –
marketing – sales and sales support
Concept of hunters and farmers
The modern day sales manager is both an
administrator in-charge of personal selling activity and
a member of the group that makes marketing
decisions of all types.
5

6. THE SALESMAN
…..they make more noise and more mistakes, create
more cheer, correct more errors, adjust more
differences, spread more gossip, hear more grievances,
pacify more belligerence and waste more time under
pressure, all without loosing their temper, than any other
class of professionals –including politicians.
6

7. THE SALESMAN
…they live in hotels, cabs and tents on trains, buses, eat
all kinds of food, drink all kinds of liquids –good and
bad- sleep before, during and after business, with no
sympathy from the office.
They draw and spend more money with less effort, they
come at the most inopportune time, under the slightest
pretext, ask more personal questions.
Yet they are a power in society…
7

8. THE SALESMAN
With all their faults, they keep the wheels of commerce
turning, and the currents of human emotions running.
More cannot be said any man. Be careful whom you call a
salesman, lest you flatter him.
-Donald Benenson in Ziglar on Selling
8

9. SALES MANAGEMENT
“QUALITIES THAT LEAD TO EFFECTIVE SALES MANAGEMENT
ARE OFTEN OPPOSITE THE ATTRIBUTES OF A SUCCESSFUL
SALES PERSON”

10. SALES ORGANIZATION
With various tasks required to be performed the
enterprise had to create a structure to ensure that work
is done. (the Sears story)
Principles of structure: authority, responsibility,
performance, support/co-ordinate.
10

11. SALES ORGANIZATION
Concept of organization: Group of individuals working
jointly to achieve a defined goal and bearing formal and
informal relations with one another. An organization is
oriented towards and a co-operative endeavor and a
structure of human relationships.
11

12. PURPOSE OF ORGANIZATION
Eliminate waste of effort
Minimize friction
Maximize co-operation
Permit development of specialists
Ensure that all activities get done
Achieve co-ordination/balance
Define authority
Fix responsibility
12

13. TYPES OF ORGANIZATION
STRUCTURES
Line organization: line managers perform sales and sales
management activities.
Line and staff organization: Staff managers have advisory
or support responsibility. e.g.Market research manager,
Training manager.They are not directly responsible for
achieving sales targets.
13

14. ORGANIZATION STRUCTURES
Functional organization: focus is on the principle of
specialization. Each specialist has a functional
responsibility and are permitted to direct and control the
salesperson thru their immediate superior.
14

15. ORGANIZATION STRUCTURE
Horizontal structure.
Specialised structure:
Geographical;
Product;
Market or customer;
Combination of specialised structures.
15

16. 16
 Clear authority & Responsibility
 Quick response & Decision, Low Cost
 Weak on marketing inputs
 Sales manager controlled
Line Sales Organization structure
Area Sales
Mgr
Area Sales Mgr Area Sales
Mgr
Area Sales
Mgr
Sales Force Sales Force Sales Force Sales Force
Sales Manager
Head –Marketing

17. 17
Head -
Marketing
Marketing
Services
Sales
Promotion
Brand
Market
Research
Area Sales
Managers
Sales Force
 Administrative Simplicity
 Access to Specialists
 Multiple reporting
 HOD is Pressures to co-ordinate
Functional Sales Organization

18. 18
Research & Design team
Customer Research
Product / Service design
Operations team
Production
QA
Engineering Systems
Customer Support team
Service
Training
Information
Customer Satisfaction
teams
Sales & Marketing
Pricing & Promotion
Channels
Logistics
Planning Team
Strategy
Finance
HR
C O O

19. SALES RELATION WITH
MARKETING ACTIVITIES
Sales &Advertising: both stimulate demand. They need
to be blended. Salespersons can improve advertising
effectiveness. Advertising needs to support sales
where and when they need it most.
Sales & Marketing information: data is needed for
analysis of sales problems, for determining sales
potential. Raw data is collected by sales people.
19

20. RELATIONSHIPS
Sales and service: contributes to strategy success.
Sales and distribution: minimizes stock out situation;
improves inventory control; helps sales to focus on
demand generation.
Sales & Production:
Sales and R&D
Sales &Finance
20

21. SALES PLANNING
A MANAGERIAL FUNCTION
EXISTING BUSINESS
21
LONG RANGE PLAN 3 TO 5 YEAR PROJECTIONS
ANNUAL OPERATING PLAN REVISED YEAR TO YEAR
SEGMENTWISE PLAN PAST TREND
GEOGRAPHICAL PLAN PREVIOUS YEAR SALES
CUSTOMERWISE PLAN CURRENT YEAR ACHIEVEMENT
PLAN BY VALUE NEXT YEAR PLANS
PLAN BY VOLUME ASSUMPTIONS

22. PLANNING FOCUS AREAS:
•PROFITABILITY IMPROVEMENT
A REGION OR TERRITORY CEASES TO CONTRIBUTE
DISCONTINUATION OF SALES TO AN ACCOUNT
DE-EMPHASISING PRODUCTS
ACCEPTING A PRIVATE BRAND ORDER
VARIANCE BETWEEN BUDGET AND ACTUAL SALES
22

23. SALES PLANNING
NEW BUSINESS
VISION MISSION GOALS
STRATEGY
*ACTION PLANS
23

24. KEY DELIVERABLES OF THE
SALES FUNCTION
Planning
Organizing
Training
Motivating
Controlling
Leading
24

25. SALES PLANNING
Forecasting a key planning tool
PRODUCT LEVEL –
total sales -
industry sales
company sales
product line sales
product variant sales
25

26. TIME PERIOD FORECAST
Long Range
Medium range
Short term (range)
26

27. PLANNING PROCESS
Sales plan
Capacity plan
Production plan
Cash flow plan
Procurement plan
27
Human resource plan

28. SALES FORECAST
Why forecast?
One of the keys to success in sales is knowing where
customers are located and being able to predict how
much they will buy.
28

29. SALES FORECASTING;
INDUSTRY ESTIMATES
29
• Objective definition
• Identifying critical factors (assumptions)
• Selecting method of forecasting
• Collecting, analysing, interpreting data.
• Concluding predictions.

30. GEOGRAPHIC AREA
FORECAST
Nation
Region ( REGION OR ZONE )
Territory ( BRANCH / DISTRICT )
Customer
30

31. FORECASTING APPROACHES
Top - down / Break –down approach
An SBU level forecast broken down to region, district,
territory, salesperson and individual customer sales
quotas
Bottom –up / Build – up approach
Individual customer to branch to zone to company level
forecast
31

32. METHODS OF SALES
FORECAST
Qualitative methods:
Executive opinion
Delphi method – prediction by a panel
Sales force composite – ‘grass roots’ approach.
Test marketing –controlled or simulated
32

33. SALES FORECAST METHODS
Quantitative methods:
Moving averages
Exponential smoothing
Regression analysis
Econometric analysis
33

34. SELLING SITUATIONS
Customer’s intention and expectation are
specific. (insurance, mobile service)
Customer is contacted over phone
Customer is an organizational buyer
Customer seeking service or solution
Customer in a retail store
Cold calling situation
Pharmaceutical selling
Creative selling ( ad.campaign)
34

35. THE SALES BUDGET
To the sales department, the budget is a blue print for
making sales. It involves money invested in distribution
facilities, promotion efforts, and sales personnel. It is the
foundation on which to plan sales objectives and the
means of achieving them during the coming year.
35

36. SALES BUDGET
A budget is a quantitative expression of plans.
Most well managed enterprises use a budget
which is a comprehensive and coordinated plan
for the operations and resources of the
enterprise.
It is a formal and intricate process
Approaches are either incremental or zero
based.
In a volatile economic climate organizations
estimate optimistic, realistic and pessimistic
scenarios.
36

37. SALES BUDGET
Critical factors considered:
1. past trends
2. Sales force estimates
3. Trade prospects
4. Present scenario
5. Customers: existing and potential
6. Government policies
7. Industry environment
37

38. NUMBER OF SALES PEOPLE
Decision on the size of the sales force is very
complicated because structure of the customers vary in
each territory, the level of competition varies across
territories, the connectivity for travel varies etc.
There are 3 generally accepted approaches: affordability,
incremental and workload methods.
38

39. SALES TERRITORIES
Definition : A sales territory consists of existing and
potential customers assigned to a sales person. The
territory may or may not have geographic boundaries.
39

40. REASONS FOR TERRITORIES
Increase / improve customer coverage
Control selling expenses
Effective evaluation of salesman’s performance.
improve customer relations
40

41. TERRITORY DESIGN
Main procedural steps:
1. Selection of a basic geographical control unit
2. Determination of sales potential present in each unit
3. Combining the basic units into tentative territories
4. Adjust for differences in coverage difficulty and
readjust the tentative territories ( build up / break
down method )
41

42. TERRITORY DESIGN
Build up method: Decide call
frequency Calculate total no of calls in
the unit Estimate workload capacity of salesman Make
tentative territories Develop final territories
42

43. TERRITORY DESIGN
Break down method: Estimate
company sales potential for total market.
Forecast sales potential for each control unit.
Estimate sales expected from each salesman.
Make tentative territories. Develop final
territories.
43

44. ROUTING SCHEDULING AND
CONTROL
Reasons / advantages:
Maintain lines of communication
Improve territory coverage
Minimize wasted time
Closer scrutiny of sales force movement
Journey plans for improving customer satisfaction
44

45. QUOTAS
Quotas are quantitative goals assigned to individual sales
persons for a specified period of time.
One of the most widely used tools in sales management.
Should not be confused with sales potential or sales
forecast.
Quotas may be set equal to ,above or below the sales
forecast.
45

46. WHY QUOTAS ?
To help management motivate sales people.
To direct sales people where to put there efforts.
To provide standards of performance evaluation
46

47. TYPES OF QUOTAS
Sales volume Quotas : Rupee volume / Unit volume
Profit based Quotas: contribution / gross margin
Activity Quotas: calls per day; sales meetings; product
demos; ( efforts = results.)
Expense Quotas
47

48. QUOTA SETTING MECHANISM
S-specific
M-measurable
A-achievable
R-realistic
T-time bound
48

49. What is Motivation??
Drive to initiate an action.
The intensity of effort in an action
The persistence of effort over
49

50. WHY MOTIVATION
Frequent rejection
Physical separation from company
support
Direct influence on quality of sales
presentation
Indirect influence on performance
50

51. SALES FORCE MOTIVATION
“the desire to make an effort to fulfill a need is
motivation”
Motivation includes three dimensions: Direction,
Intensity and persistence.
Motivation may also be Intrinsic or extrinsic
Maslow’s hierarchy of needs:
51

52. MASLOW’S THEORY
52
Self
Actualisatio
n
Esteem needs
Social needs
Safety needs
Physiological needs
Food, clothing, shelter,
health care

53. MASLOW’S HIERARCHY OF NEEDS
53
Intense job challenge, full potential, full
expression, creative expansion.
Achievement, respect, recognition,
responsi-
bility, prestige, independence, attention,
importance, appreciation.
Belonging, acceptance, love, affection,
family
and group acceptance, friendships.
Security, stability, dependency,
protection,
need for structure, order, law, tenure,
pension,
insurance.
Hunger, thirst, reproduction, shelter,
clothing,

54. FREDERICK HERZBERG
THEORY
“Two factor theory” of motivation
Hygiene ,maintenance, or job context factors.( dis
satisfiers )
Achievement, challenge, advancement, growth in the job.
(satisfiers )
54

55. SELLING
55
THE WORD SELL IS DERIVED FROM A Norwegian WORD SELJE
WHICH MEANS TO SERVE
TO SERVE YOUR PROSPECTS YOU MUST UNDERSTAND THEIR
NEEDS.
PEOPLE INVARIABLY BUY WHAT THEY WANT, EVEN ABOVE
WHAT THEY NEED

56. THE SALES PROCESS
Process: a sequential series of decisions and or actions.
56
BUYING PROCESS SELLING PROCESS
NEED PREPARE
SEARCH FOCUS
IDENTIFY DEFINE
ISOLATE PROPOSE/PRESENT
SELECT HANDLE OBJECTIONS
BUY CLOSE THE SALE
CONSUME FOLLOW UP

57. THE SALES PROCESS
1. Prospecting & Qualifying
2. Pre approach (pre call planning )
3. Approach
4. Presentation & Demonstration
5. Overcoming Objections
6. Trial close / Closing the sale
7. Follow –up and Service.
57

58. SELLING PROCESS
THE ZIGLAR METHOD
Focus on Prospects NEEDS and WANTS.
Sell by design, not by chance.
Follow a proven 4 step formula:
NEED ANALYSIS
NEED AWARENESS
NEED SOLUTION
NEED SATISFACTION
58

59. PROSPECTING
Process of identifying potential buyers.
A prospect has a reasonable probability of buying ,has
sufficient need to justify a profitable sale ,has financial
resources to buy and can be classified as ‘eligible to buy’
MONEY? AUTHORITY? DESIRE?
59

60. LOCATING PROSPECTS
Lead generation – a three step process.
1. Defining the target market :what it wants; what it
buys; where and when it buys; what it buys; how it
buys;
2. Using communication tools to gather leads –
Advertising, Direct mail, Telemarketing, Trade
shows, buying data
3. Qualifying the Leads.
60

61. SELLING FIRST TIME TO
PROSPECTS
(PRE SALE PLANNING)
Adequate knowledge of the product to be sold, company being
represented, the market competition ,category or segment of customers
and selling techniques.
Product knowledge: Evolution-Features-Benefits-Uniqueness-Price
Company knowledge: History-Values-Achievements-Management-Policie
61

62. PRE SALE PLAN
Competitors knowledge :structure-share-strategy-
systems.
Customer knowledge :attitudes-preferences-
behavioural habits
Selling techniques :
62

63. PRE APPROACH PLANNING
Focus on understanding customer needs and
characteristics and preparing a proposal on
how the product or service offered can satisfy
the need.
Steps involved are:
Determining call objectives.
Development of customer profile.
Determine customer benefits.
Determine the flow and content of the
presentation.
63

64. UNDERSTANDING BUYER’S
NEEDS
Situational questions: questions about
prospect’s current situation. (who will decide?
is it the first time ? Changing source ?
Problem identification question: Questions to
uncover problems, difficulties or needs (
problems on quality, delivery ?)
Problem impact questions: questions to make
the buyer realise the impact of the problem and
the need to solve it.( what will be the impact on
costs , on customer satisfaction ?)
64

65. Solution value questions :questions to help the buyer
asses the value or usefulness of the solution ( for x
benefit how much would you save ?
Confirmation questions: (how would an error free system
help?)
65

66. NEED AWARENESS
At this stage you need to THINK
Prospect and Salesperson should both be aware of the
need. (remove blind spots)
66

67. NEED SOLUTION
Present your product
Time to stop asking questions and start providing
solutions.
People don’t buy products, they buy what the product
does for them.
67

68. QUESTIONS ARE THE
ANSWER
Thinking vs. feeling questions.
When you learn how the customer feels you are more
likely to find out what the person thinks.( the seat belt
case)
Tying emotion to logic.
68

69. THE QUESTIONING PROCESS
Three basic types of questions enable us to discover the
needs of our potential customers.
1st The Open Door Questions.-allows the prospect the
freedom to go where ever they like. the “who, what
where ,when, how and why” questions
69

70. QUESTIONING …
The closed door question: “would you tell me more”;
“what do you mean by…Answers to these give you
information to helping the prospect and building trust.
70

71. QUESTIONING…
“yes or no” questions demand a direct response. “do you
agree..” “would my proposal..” “are we in agreement..”
They allow you to check on your progress on the sales
process. “trial close”
71

72. PRESENTATION METHODS
Stimulus response method: also called a
‘canned approach’, a memorised sales
presentation .It assumes that if a right stimuli
is made it will get a favourable response.
Formula method: the AIDA process.
Need-satisfaction method: an interactive sales
presentation. The most challenging and
creative method. The FAB way.
Features, Advantages, Benefits.
72

73. THE PRESENTATION
Attracting Attention
Creating Interest
Building Desire and conviction
Initiate Action to buy.
73

74. PRESENTATION METHODS
Team selling method: a multi person sales
team deals with a multi person buying centre
(or buying committees)
Sales team consists of Account executive,
technical support engineer, logistics expert, IT
or systems executive and Finance executive.
Buying committee consists of materials exec.
manufacturing/operations exec. supply chain
exec. Materials manager and Finance exec.
74

75. PRESENTATION METHODS
Consultative selling method: problem-solution method.
Requirements are:
Knowledge of the industry, clients company, awareness of
key members needs,
75

76. OBJECTIONS
Objections , opposition , resistance to the presentation
typically happens during the presentation or while asking
for the order.
Objections should be welcomed.
Objections indicate that the prospect is involved and not
indifferent.
Objections reflect the prospect’s view.
76

77. OBJECTIONS
1. Psychological ( hidden ) – includes pre-determined
ideas or beliefs, preference for established brands,
dislike of making decisions , anxiety or resistance to
spend money , suspect about quality etc.
2. Logical or practical or real –delivery schedule, high
price , product availibility,
77

78. HANDLING OBJECTIONS
Listen
Understand
Negotiate
78

79. METHODS OF HANDLING
OBJECTIONS
Ask questions: listen, rephrase, reconfirm the objection
and explain.
Turn objection into a benefit and trial close.
Deny objections tactfully. (arrogance and sarcasm to be
strictly avoided)
Testimonials, referals
Compensation for valid objections.
79

80. NEGOTIATION
Plan – pre determine ‘firm’ and ‘flexible’ factors; define
limits.
Ensure an atmosphere of trust , understanding and
respect.
Define purpose and objective.
80

81. NEGOTIATION STYLES
Win – loose
Win – Win
Loose - Loose
81

82. CLOSING THE SALE
Summarize
Advantage and disadvantage comparison
Opportunity benefit
Emotional appeal
Direct closure
A.A.F.T.O=Always Ask For The Order
82