MANAGEMENT PROGRAMME Term-End Examination December, 2OO7

MS-62 ) : SALESMANAGEMENT
T i m , e :3 h o u r s Maximum Marks : 700 (Weishtase70%) Note : fl 0n (iiil Attempt any three questictns from SectionA. Secfion B is com pulsary. All questions carry equal morks.

SECTION A
1. (a) Discuss some of forecasting. (b) What sales forecasting techniques will you use to estimate the demand of branded non-toxic gulal (dry colour) which is costlier by 50o/o? This forecasting is needed for the company to plan for the production of the required quantity for the festival of Holi. You may assume the sales for your district or state for this purpose. the rnajor techniques of sales

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2.

What is Sales Quota ? How are sales quota and sales territories interrelated ? Discuss taking specific examples. (a) Briefly explain the methods of developing effective sales budgets. (b) What items (heads) do you consider to give

3.

information in a sales budget I Fxplain in detail. 4. Write brief notes on any three of the following : (i) (ii) , (iii) (iv) (v) Personal Selling Skills Use of lT,/Computers in Sales Management Sales Organisation Sales Training Monetary and Non-Monetary Sales Incentives

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SECTION B 5study the case given below and answer the questions given at the end : Case : Modern Engineering Works Limited

Mr. Ramesh Chauhan, General Manager of Modern Engineering Works Limited (MEW), Jaipur, recommended a sales contest to improve declining sales performance. This was his response to first-quarter results that saw sales fall substantially below quota. Mr. chauhan believed that a sales contest would, among other things, provide the incentive to get sales up to or beyond territorial quotas. MEW distributed a complete line of electrical motors, pumps, parts, switch-gear and accessoriesin the state of Rajasthan. Its sales lorce of sixty persons operated out of ten branch offices located at Jaipur, Ajmer, Jodhpur, Bikaner, Udaipur, Sriganganagar, Alwar, Bharatpur, Kota and Pali, in Rajasthan. The sales force's compensation plan consisted of a base salary and a bonus. The bonus was based upon the territorial quota, which was set by the General Manager, in consultation with the Branch Sales Manager. Mr. Chauhan proposed a sales contest which would, in his opinion, motivate sales personnel to achieve their quotas.

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P.T.O.

The details of the contest were as under : (a) The duration of the contest would be a quartr, i.e. 13 week s .

(b)

There would be a weekly sales volume quota for each salesperson determined by the General Managerand respective BranchManager.
Each of the ten branches would also have a branch sales volume quota for the quarter.

(.)

(d) . A cash bonus of Rs. 500 each week would go to the sales person exceeding his/her quota by the greatest percentage. Mr. Chauhan wanted to use total sales volume instead of percentage but settled for the percentage eventually. (e) Each sales person who achieves the quarter. quota would get a bonus of Rs.

1,000,

(0

A cash bonus of Rs. 2,000 would be paid to the sales person exceeding his,/her quarter sales quota by the greatest percentage. Bonus of Rs. 1,000, Rs. 750 and Rs. 500 would go to sales persons in second, third and fourth places respectively.

(s)

In the competition amongst branches', the branch exceeding its quota by greatest percentage would receive Rs. 4,000 as prize which would be shared equally among the sales persons associatedwith that branch. Second, third and fourth places in Rs . 2, 00 0 a n d R s .' 1 ,0 0 0 re s p e c ti v e l y. thg inter-branch competition would receive Rs. 3,000,

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(h)

All sales persons, who achieve their quotas and those who are to receive bonuses at the end of the quarter, would be invited for a grand award function at Hotel Rajputana Sheraton, Jaipur, a leading S-star hotel. The award would be handed out by Mr. Naresh, the Executive Director of MEW. When Mr. Chauhan formally proposed his plan for a

sales contest, many objections were raised. All these objections related to usual objections in sales contests like disappointment and frustration amongst sales persons who would not win, disruption in normal pace of work, over aggressivenessamongst some people, the likely fall in sales during the quarter succeeding the contest-quarter and so on.

Mr. Chauhan felt that a contest would correct the poor sales performance, raise and kindle a competitive spirit amongst its sales force, give them an opportunity to get their achievementsrecognizedand raise the morale of the entire sales force. In spite of a disagreement, Mr. Chauhan scheduled

the to discuss a meeting of his staff and branch managers

advisability of conducting a sales contest.

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P.T.O.

Questions (i)

Should Modern EngineeringWorks Limited go ahead with a sales contest to motivate its sales personnel to better sales performance ? Why or why not ?

(ii)

What is the purpose of organizing a contest amongst branches ? Should individual performance based contests be run concurrently with group-performance based contests ? Why or why not ?

(iii)

Could you suggest some other proposal to motivate sales personnel to achieve their sales quotas ? Give your reasons with delails of the proposal, as to how would it be better than the sales contest ?

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1,000