Sales

Strategy & Communication Skills

CH1
What is selling?
Personal Selling:
Salesperson examines a
- customers situation/needs
- provides information and advice
- seeks to gain commitment from the customer that will be continuous

Consultative component:
- The customers situation, problem and needs
Advantages:
- Customer satisfaction
- Customer loyalty
- Word of mouth
- Long term profit

Challenges:
- Salespersons requires skills
- Salespersons stress

Influence Component:
Gain commitment

Consultation and Influence Selling as problem solving

Steps (IDSF)
1 Identify problem
2 - Develop and evaluate potential solutions
3 Select & communicate the best solution
4 Follow through to ensure the solution is effective

Required skills
- Analytical skills
- Communication skills
- Presentation skills
- Persuasion skills

The Buyers Side Why do they buy?
- Selling creates economic exchange
- Involves profits for both parties

Buyers value
= Benefits received
- [Selling price + Time and effort of purchase]

The Role of personal selling in a firm?
The purpose of selling increase the profit
Profit
= Price
X Quantity
- Cost

Creating Value: Role of salesperson

Go to market strategies:
Options of companies to approach customers as they add value
- Internet
- Field Sales Representatives
- Business partners
- Resellers
- Manufacturer agents
- Franchises
- Telemarketers

What factors determine the go-to-market strategy?
Customer lifetime value:
Estimated value of customer over the lifetime of the relationship

Multichannel strategy (segments):
Using several strategies at the same time

Integrated marketing communications:
Communication programs that coordinate the use of various vehicles

Communication methods
Paid/Unpaid
Impersonsonal/Personal

Roles of salespeople
Client relationship manager
Activities include: 50% of the time
- Prospecting new customers
- Making sales presentations
- Demonstrating products
- Writing orders

Admin Tasks: 50% of the time
- Internal meetings
- Working with internal support people
- Travelling
- Waiting for sales interviews

Principles:
- Customer centric, 24/7 availability, six stigma selling programs

Account team manager
- Research and development
- Designers
- Marketing
- Sales Reps
- Legal
- Customer service

Supply chain logistics and channel manager
- Supplier A1, A2, etc. to supplier A to seller to buyer
- Supplier B to seller to buyer
- Supplier C to seller to buyer


Information provider to their firm
Salesperson Information provider to the firm

Role of sales Traditional & Modern view
Marketing process:
- Situation analysis
- Objectives
- Market segmentation
- Marketing Mix
- 4 Ps
- Budgets and controls

Tasks:
- Investigate market
- Identify targets
- Groups of customers with same needs
- Develop integrated strategy to attract selected customer groups

Modern View:
- What strategic input may sales be able to deliver
- Market intelligence

What are the different types of salespeople?
Distribution channel:
Set of people and organisations responsible for flow of products and services from
producer to ultimate user

Business to business channels
Direct sales to a business customer
Sales through distributors to business customers

Industrial sales people
Employed by manufacturer to sell to businesses

Trades salespeople
Employed by manufacturer to sell to distributor
Distributor salespeople
Employed by distributors to sell to business

Missionary salespeople
Work for manufacturer and promote their products to other firms

Customer channels
1. Direct sales to consumers
2. Sales through retailers
3. Sales through distributors

Manufacturer agents:
Independent businesspeople paid a commission by manufacturer for products and
services sold

Describing the sales job
Characteristics

Stage of buyer-seller relationships

New VS Existing
Salespersons role




Single orders VS Headquarters
Importance of customers purchase decision
Minor VS Major
Location of salespeople



Field VS Inside
Nature of offering sold by salesperson

Product VS Service
Salespersons role in securing commitment
Informing VS Placing order

What characteristics do successful sales-people have?
- Self-motivated
- Dependable
- Ethical
- Customer/product knowledge
- Communication skills
- Creativity
- Flexible

Emotional intelligence
Ability to effectively understand and regulate ones own emotions and to read and
respond to the emotions of others

Aspects:
Knowing own feelings, controlling them & avoiding acting impulsively, recognising
customers emotions, using ones emotions to interact with customers, positively related
to performance and retaining customers

Ways that salespeople can add value in a selling situation?
- Provide interface between the buying and selling companies
- Identify networks of key players & help them to co-create value
- Encourage two-way communication & help create effective bonds
- Help to create a co-leadership with seller

What are the rewards of a selling career?
Rewards:
- Feedback
- Independence & responsibility
- Financial
- Skill set development
- Management opportunities

CH 2: Buying behaviour and the buying process
The buying centre: (IIGDM)
- Initiators
- Influencers
- Gatekeepers
- Deciders
- Users

Initiators:
- Start the buying process
Influencers:
- Provide information
- Economic influencer (financial aspects)
- Technical influencer (technical requirements are met)
- Coach (advise & directs a salesperson in a buying process leading to sale

Gatekeepers:
- Control the flow of information and limit the alternatives considered
- Ensure purchases are consolidated under one contract
- Reduce costs and increase quality
Deciders
- Make the final choice
Users:
- Do not make the ultimate purchasing decision
- Manufacturing personnel for OEM products & capital equipment

Types of customers: (PGCRI)
Producers
- Buy products & services to manufacture and sell their products & services to
customers

Government agencies
- Purchase goods & services
- Develop quantified specifications for products
- Invite qualified suppliers to submit bids
- Conduct small purchases without bidding

Consumers
- Purchase products/services for use by themselves of by their families

Resellers
- Buy finished products or services with the intention to resell them to business
consumers

Institutions
- Public and private

Why does it matter for salespeople?
- Different needs
- Different purchase processes
- Different importance of relationship-building

Government agencies:

Multi-attribute model of product evaluation and choice (PIOVS)
- Performance evaluation of characteristics
- Importance weights
- Overall evaluation
- Value offered
- Supplier selection

Implications for salespeople
- Approaches for changing perceived value

Increase performance rating for the product

Decrease the rating of competing products

Increasing/decreasing an importance wright

Adding a new dimension
- Decreasing the price of the product

Types of organisational buying decisions:

New purchase:
purchasing a product/service for the first time

Straight re-buys:
Buying the same product from the source it was previously bought

Modified re-buys:
Obtain new information about a product purchased in the past


Making a purchase decision
Think again of the complex product in which you analysed before
Try and identify different steps/activities that you undertook before and after the
purchase

Organisational buying process (RDDSAEPE)
- Recognition of need
- Define product type needed
- Development of detailed specification
- Search for qualified suppliers
- Acquisitions and emphasis of proposals
- Evaluate proposal select supplier
- Place/receive order
- Evaluation or product performance

Supplier evaluation and choice selection of products & suppliers are affected by
the needs of:
Supplier evaluation & selection of products & suppliers are affected by the needs of:
- organisations
- individuals making the decisions

Categories of organisational and personal needs:
Rational needs: Performance of the product
Emotional needs: Personal rewards & gratification of the person buying the product

Factors influencing organisational buying decisions:
Organisational factors:
Economic criteria
Quality criteria
Service criteria

Individual factors:
Needs of buying centre members
Personal risks
Personal needs

Economic criteria Life-cycle cost
- May have higher initial cost, but lower lifetime cost (power, maintenance, operating)

Service criteria
- Value analysis
- Remove unnecessary components
- Use other materials

Collaboration between purchasing department, technical experts, production,

quality control and supplier

CH 3 Using communication principles to build relationships

Two Way communications
Encoding
The sender (seller) encodes messages

Decoding
Receiver (buyer) decodes message

Feedback
The receiver becomes the sender who encodes a reply message

The receiver then decodes the buyers message

Communication breakdown
- Environment (noise, physical comfort)
- Encoding & decoding problems
- Buyers hidden agenda

Sending verbal messages effectively
Achieve persuasion:
The salesperson attempts to convince people to change their attitude or behaviours
regarding an issue while understanding that the other person is free to accept/reject the
idea
- choice of words (dos: strong, force, charm donts: overeager, tasteless, slang
- voice characteristics (rate of speech, loudness, inflection, articulation
- stories (word pictures, analogies)
- keep open lines of communication (80% listening 20% speaking)

Active listening:
Think about speakers conclusions, evaluate evidence presented, sort out important
facts from irrelevant ones, attempt to draw out as much information as possible

How can you improve?
Repeat information, restate or rephrase, clarify information, summarise conversation,
tolerate silence, concentrate on the ideas being communicated

Face to face communication
Words 40%
Voice 10%
Nonverbal 50%

Non-verbals: Body angle
Back and forth motions positive outlooks
Side-to-side motions Insecurity, doubt
Towards person positive regard
Leaning back boredom, apprehension, possible anger

Face
Large pupils interest/excitement
Blink rate 50-70 minute = stress
Focus straight = passive, staring = anger & dislike, right = logic & facts, left =
emotional, down = concentration, away extensively = disinterest

Arms
Crossed - disagree
Movement rate high convey opinion
Movement style broad vigorous = more empathetic about point being conveyed

Hands
Open & relaxed positive signal, especially with palms facing upward
Touching own hands tension
Involuntary gestures reveal true inner emotions

Legs
Open & uncrossed cooperation, confidence, friendly interest
Crossed away disinterest, with to end the call

Distance Zones
Intimate zone For closest relationships
Personal zone For close friend and people with shared interests
Social zone For business transactions and other impersonal relationships
Public zone For speeches and passers-by

Customer touching groups
Non contact (STOP)
- see contact as overly friendly and obtrusive
- reaction: disliking, aggressions

Contact (YES)
- see non-contact as cold and unfriendly
- reaction: liking and persuasion

Attire Dress for success
Consider geography temperatures & local cultural norms
Consider customers their appearance, their expectations of your appearance
Consider corporate culture norms for your industry
Consider aspirations top levels of your organisation, dress above your position
Consider personal style wait until you have the halo effect, be reasonable

Telephone communications
Decide what to say before
Be polite, enthusiastic and an active listener
Take notes and restate the message
Encourage two-way communications with verbal ones
Give customer opportunity to ask questions
Tips for voicemail

Email communications
Immediacy does not mean intimacy
Use meaningful subject lines
Put important in the first few lines

Be careful of the tone or intent of email

Avoid techno overkill

CH 4 Adaptive selling for relationship building

Sources of knowledge
Top performers
Performance feedback
Internet
Customer meetings
Trade shows

Social style matrix
Low assertiveness:
Ask orientated
Go along attitude
Cooperative
Supportive
Risk avoider

High assertiveness:
Tell orientated
Take-charge attitude
Competitive
Directive
Risk taker

Low responsiveness:
Controls emotions
Cool
Talk orientated
Uses facts
Serious
Impersonal

High responsiveness:
Shows emotions
Warm approachable
People orientated
Use opinions
Playful

Social style
Analyticals:
Uses solid, tangible evidence
Use sales presentations that recognise their technical expertise
Technical background
Conservative dress

Drivers:
Direct, businesslike, organised presentation with quick action and follow-up
Emphasise the effects of a purchase decision on profits

Amiable:

Build personal relationships

Give guarantees about a products performance
Follow through on commitments
Stress the products benefits in terms of its effects on the satisfaction of employees

Expressive:
Demonstrate how a product will help to achieve personal status and recognition
Use product demonstrations and creative graphics
Use testimonials from well-known, firms and people

Characteristics of strong presentations (KIHOC)
1 Keep buyers attention (humour, visuals, consider buyers social style)
2 Improve buyers understanding (diagrams, product launch, personal selling)
3 Help buyer to remember (retain 20% of what we hear, 50% of what we hear & see)
4 Offer proof of assertions (what is the problem with claims?)
5 Create sense of value (careful handling of product, dos and donts)

Tools to strengthen presentation:
Verbal tools: words, pictures and stories, humour
Visual tools: graphics and charts, catalogues and brochures, models, samples and gifts
Product demos, handouts, written proposals, value analysis

Give them hard numbers:
Process of showing the prospect that the cost of the proposal is offset by added value

Sample Proposal (ECPC)
Executive summary
Client current situation
Proposed solution
Costs/budget

Adaptive selling
Changing sale behaviour according to the selling situation
Illustrated by customised presentation
Emphasises the importance of satisfying customer needs
Being adaptive


CH 5: Prospecting
Prospecting:
Locating potential customers for a product of service
EXAMPLES: merger, relocate, bankrupt, substitute

The sales funnel
Leads
Potential prospect that may or may not have what it takes
Prospects
Good candidate for making sale, has some interest in offering
Customers
Buys offering

Characteristics of good prospects: (NPAAE)
Need or want exists

Can be created by salesperson
Able to pay



Sufficient income
Has authority to buy

Not user in buying centre
Can be approached favourably
Position of buyer in company seniority
Eligible to buy


Supplier firm may have defined requirements

Finding leads
Satisfied customers larger quantities, cross-selling, generate 75% of customers
Endless chain
attempt to secure at least 1 additional lead from each interview
Networking
personal relationships with those connected & secure leads
Social media
using online tools to prospect for customers & maintain contact

Overcoming fear of prospecting and coping with rejection
- Identify & evaluate excuses not to call
- Engage in sales training & role-playing
- Prospect with supporting partner or sales manager
- Stop negative self-evaluation

Develop a positive approach:
Identify genuine feelings or reluctance
Understand that not all individual targets will lead to success
No is an rejection of the offer, not you

Reasons for rejection:
Company related
may not have corporate image of reputation the client seeks
Competition related may have been approached by competitors, reject due to overkill

CH 6: Planning The Sales Call
Why do you need to prepare?
Buyers perspective: respect & confidence
Sellers perspective: higher chance to meet objectives

What do you need to prepare?
Information about prospect
Individual prospect: personal, attitudes, relationships, evaluation at offering
Prospects organisation: demographics, customers, competitors, current buying situat.
Sources:

CRM, internet, secretaries, non-competing salespersons
Selling your objectives

Setting sales call objectives
Specific

What they hope to accomplish? What the objective targets are?
Measurable
Goals can be objectively evaluated & require a buyers response
Achievable/realistic Challenging but reachable, consider cultural differences
Time based
Achieved within a set time frame

Examples of sales calls
Leading up to sale
To have the prospect agree to demonstration of the product
To schedule a meeting to further discuss proposal
To do a complete survey of buyers requirements
To convince the buyer to endorse the product to the buying committee

Related to consummating the sale
To obtain an order from the prospect
To schedule a co-op advertising/marketing program
To make the prospect agree to a trial run of the product
To convince the retailer to display our promotional offer

Multiple call objectives:

Primary call objective:
Actual goal a salesperson hopes to achieve
Minimum call objective:
Minimum a salesperson hopes to achieve
Optimistic call objectives:
Most optimistic outcome salesperson thinks could occur
Secondary call objectives:
Other objectives, apart from the primary call objective

Making an appointment identifying the right person
Focus on receptivity: The person who will listen receptively & give seller needed info
Focus on dissatisfaction: The person most likely to perceive problems/dissatisfactions
Focus on power: The person who can approve, prevent & influence action


CH 7: Making the sales call

Aspects to consider beforehand:
Making a good impression
Identifying or reiterating needs
Offering the solution to the buyers needs
Creating credibility and trust

Before the meeting (waiting):
Be on time or call if youre going to be late
Make good use of your waiting time
15-minute rule
Be polite and tactful when asking to reschedule
REMEMBER THE NAME

Openings to gain attention:
1- Introduction opening
Simply introduce yourself (may not be interesting)
2- Referral opening

Tell about someone who referred you to buyer (get permission)
3- Benefit opening
Start by telling some benefit of the product (down to business ASAP)
4- Product opening
Demonstrate features and benefit ASAP (visual & not just verbal)
5- Compliment opening
Start by complimenting the buyer or the buyers firm (be sincere)
6- Question opening
Start the conversation with a question (two-way communication)

Develop Rapport
Rapport is a close, harmonious relationship founded on mutual trust
Dos small talk, current news, hobbies, cultural, goals, agenda
Donts controversial topics, sympathy, complain about others, gossip

Open & closed questions
Open cannot be answered with yes or no
Closed yes or no answer

SPIN Technique
Situation questions
General questions, to understand buyers situation, dont use to many

Problem questions
Questions about specific difficulties & problems. Goal: uncover problem
Implication questions
Follow problem questions help prospect recognise ramifications of problem & desire
to solve
Need payoff questions
Implication questions, gauge buyers value of solving the problem & offer solution
If buyer doesnt find problem severe, identify other problems

Translate features into benefits
Feature
Quality/characteristic of the offering
Benefit
A way in which a particular feature will help a particular buyer

FAB
Features
Advantages
Benefit

FEBA
Feature
(mention)
Evidence
(provide)
Benefit
(explain)
Agreement
(ask for)

Making adjustments:
Changing direction
Collecting additional information
Developing a new sales strategy
Altering the style of presentation

Creating credibility and trust
Commit to time meeting takes and stick to it
Back up claims
Credibility statements
Balanced presentations
Demonstrate product expertise

Four As of Selling Process
Acknowledge
Acquire
Advice
Assure


CH 8 Responding to objections obtaining commitment

Objections:
Concern or a question raised by the buyer

Right attitude:
Show proper attitude welcome objections, answer sincerely, refrain from arguing
Right self-perception:
See yourself as helper, counsellor, advisor

Types of objections (NPSPTO)

1 Related to needs
2 Related to product
3 Related to source
4 Related to price
5 Related to time
6 Related to other things

Understanding the buyers weighting
Costs: hassle to switch
Benefits: improve company image, increase morale, reduce absenteeism

Better handling objections (AFRET)
1 Anticipate
2 Forestall
3 Relax and listen, do not interrupt
4 Evaluate objections or excuses
5 Tell the truth

Effective response methods
- Probe first (using probing method) to be sure you understand the objection & to
make sure the buyer is really concerned about it
- Buyer makes a statement that is factually not true - use direct/indirect denial
- Buyer raises a valid concern/offers an opinion - use compensation, referral,
revisit, acknowledge, postpone

Direct of Indirect Denial:
Direct denial:
- Relatively strong statement to indicate error the prospect has made
- Appropriate when objection is: blatantly inaccurate/devastating to presentation
Indirect denial:
- Deny the objection but attempts to soften the response
- Must recognise position of customer who makes the objection
- Then continue by introducing substantial evidence
- Assure prospect that the question is a good one

Compensation & Referral method
Compensation method:
- acknowledge objections validity & show any compensating advantages
- superior benefit method: benefit of one attribute overcomes concern about a
less important attribute
Referral method:
- Feel-felt-found method: relating how others found initial opinions to be
unfounded after they tried the product
- Third-party testimony method: eg. Testimony letter

Revisit & Acknowledge method
Revisit method:
- Turns objection into a reason for buying
- If buyer superficially criticizes the product feature

Acknowledge method:
- Let buyer talk, acknowledge, more on to another topic after a pause
- If buyer just wants to let off steam

Postpone method:
- Seek permission to answer the question after the presentation
- Useful when a price objection occurs early in the presentation
- Answer directly

Objections when selling to a group
- Get an idea of whether other buyers share the concern
- Throw the concern back to the group
- Any response should be directed to all buyers, not just that which asked the
question
- Make sure all buyers are satisfied with the answer

Most common Price objection
- Most frequently mentioned obstacle
- Use up-to-date information
- Dont lower price as a first response
- Establish the value Two step approach

Recall Aspects Discussed
- Types of objections
- Best practice handling objections
- Response options to objections

Closing
Asking for the buyers business
Dont:
Use the traditional focus on closing no matter what As it
- Damages trust
- Insults the buyers intelligence
- Raises the possibility of losing commitment
Do:
- Close should be the natural, logical progression of the sales consultation
- Win buyers commitment that enables a close

Commitment
Examples:
- Informing buyer & having them read product brochure
- Set up follow-up appointments
- Have buyer visiting for product demo
- Have buyer agreeing to call reference customers
- Have buying using offering for trial product

When to attempt to obtain commitment
Closing cues: indications that the buyer is ready to buy
Verbal cues: questions about product, requirements, benefit statement, response to trial
Non-verbal cues: facial expression, actions

To successfully obtain commitment
Best practice:
- Positive attitude
- Let customer set pace
- Be assertive, not aggressive or submissive
- Sell right items in right amounts

Aggressive, submissive & assertive selling style

Aggressive: Too pushy
Submissive: Too diffident
Assertive: Optimal style
Defining customer needs:
Aggressive: believe they are the best judge of customers needs
Submissive: Accept customers definition of needs
Assertive: Probe for the need-related information that customer may not have
volunteered

Controlling the presentation:
Aggressive: Minimize participation by customer
Submissive: Permit customer to control presentation
Assertive: Encourage two-way communication and customer participation

Closing the sale:
Aggressive: Overwhelm customer respond to objections without understanding
Submissive: Assume customers will buy when ready
Assertive: Respond to objections, leading to close

Effective methods:
Direct requests, benefit summary, balance-sheet method, probing method, alternative
choice, trial offers

What to do if buyer says yes (SCSAFR)
No surprises
Confirm buyer choice
Get signature
Show appreciation
Cultivate for future calls
Review actions to be taken

What to do if buyer says no (GPRIA)
Keep showing good manners
Maintain proper perspective
Recommend other sources
Identify reasons: attitudes, presentation skills
Analytically discover cause

Price:
Should be discussed at end
Set the price for buyer after studying
- Competitors offerings
- Value delivered by the product/service
- Cost of providing the product/service

Financial terms & conditions
Discounts based on:
Type of customer
Quantity purchased
Quantity discounts:
Single-order discounts
Cumulative discount discount for transactions over a longer period
Credit terms- cash discounts
Shipping costs:
Free on board (FOB) buyer assumes responsibility for goods & cost of shipping htem

FOB destination Buyer takes responsibility for the goods once they reach the buyers
location, seller pays freight
FOB installed Title and responsibility do not transfer until the equipment is installed &
operating properly

Bringing interview to close:
Leave with a clear plan, review what you will do next, what the customer will do next,
when you will meet again
Follow up promptly with a thankyou and reminder note


CH 9 Formal negotiating building partnering relationships
Formal negotiating:
Negotiation:
Bargaining process through which buyers & sellers resolve areas of conflict & arrve at
agreements
Minor issues:
Eg. Who should attend future meetings
Major issues:
Eg. Cost per unit or exclusive purchase agreements

Negotiation VS. Non-negotiation selling:
- Regular sales call are constrained
- Negotiations differ from regular sales calls more intensive planning, larger
number or people from the selling firm
- Formal negotiations only with very large/important prospective buyers

Negotiation philosophies
Win-lose negotiating:
Negotiator attempts to win all important concessions & thus triumph over opponent
Win-win negotiating:
Negotiator attempts to secure an agreement that satisfies both parties

Planning the negotiation session:
What to plan: (PRTNIT)
Prepare
Location
Time allotment
Negotiation objectives
Information control
Team selection & management

Advantages/disadvantages of teams
Advantages
- More creative than one individual due to different backgrounds
- Members help one another & reduce the chances of making a mistake
Disadvantages:
- More participants involve more time to reach agreement
- Different opinions make the sellers team appear disorganised

Team size, roles & management
Size: as few as possible, match buyers team size
Roles: team leadermanages session, expertstechnical questions, executives-speaker
Understanding: rules & signals to communicate with one another, practice roles

Conflict handling Behaviour models

- Cooperative/Uncooperative, Assertive/Unassertive
- Competing, collaborating, comprising, avoiding, accommodating

Negotiate meeting
Aspects to take into account:
Preliminaries
- Conversation to break the ice
- Ensure a comfortable environment
- Establish a win/win environment
- Prepare an agenda
Guidelines
- Listen carefully
- Keep track of issues discussed or resolved
- Consider cultural differences
Dealing with win-lose negotiators
- Good guy- bad guy routine
- Lowballing
- Emotional outbursts
- Total silence
Making concessions
- Concessions: One of the involved part agrees to change a position in some way
- Dont make concessions using all buyer demands & opening position are known
- Be confident & secure position and do not give concessions carelessly
- Dont be afraid to say no
- Should get something in return

Building partnering relationships
Value of a lasting relationship
Car accessories inspection inspect/repair new car
- More business than initial sale
- Retain customers to unlock/increase customer lifetime value
- To retain consultative sales approach/invest in relationship
Customer lifetime value:
The net present value of all future profits attributed the entire future relationship with a
customer

Customer loyalty:
Loyal customers:
- buy more
- are willing to pay more
- influence friends to buy
- are willing to help develop products

Behavioural loyalty:
Purchase of the same product from the same vendor over time
Attitudinal loyalty:
Emotional attachment to a brand, company or salesperson

Type of relationships
Market exchanges transaction in which each party is concerned about its own benefit
Solo exchanges & Functional relationships
Partnerships Both partners are concerned about each others welfare
Relational partnerships & Strategic partnerships

Choosing the right relationship

Factors to consider:
- Customer preference
- Size of account
- Access & image in the market
- Access to innovation

Phases of relationship development (AEECD)
Awareness Locate/qualify prospects & buyers identify sources of supply
Exploration Search/trial phase for both buyer/seller. Satisfaction = move forward
Expansion Efforts by both parties to investigate benefits of long-term relationship
Commitment Pledge to continue relationship for a period of time investments made
Dissolution Process of terminating relationship loss of investment for both

Due to poor performance, change in needs, clash in culture, other

Foundations of successful relationships:
- Mutual trust belief that other party will fulfil obligations
- Open communication open about drivers, strategies/problems
- Common goals lead to strong incentive to pool strength & help exploit
opportunities
- Commitment to mutual gain Tangible investment in the relationship by both
parties
- Organisational support- Boundary spanning-employees cross boundary &
interact with customers


CH 11 Building long term partnerships ethical issues
Ethics:
Principles governing the behaviour of an individual or group to establish appropriate
behaviour, indicating what is right/wrong

Basic principle of ethical selling
Manipulation:
Eliminating/reducing a buyers choice unfairly
Persuasion:
The decision still remains the buyers, with attempts made to influence it
Guiding principle:
Customer remains free to make a choice

Factors affecting ethical behaviour of salespeople:
Personal goals, Customer goals, Company goals, Social norms, Company policies, Laws
- Potential clash of personal, company & customer goals
- Company policies defined in guidelines
- Laws for basic right & wrong

Negative consequences of unethical behaviour
Lower self-respect & confidence in self
Thinking that the only way to make sales is to be dishonest or unethical
Compromising long-term customer relationships in the pursuit of short term gains

Selling ethics & relationships
In customer relationships
- Deception
- Bribes, gifts and entertainment

-
-
-

Special treatment
Confidential information
Backdoor selling

Sales ethics & relationships
In relationships with the salespersons company
- expense accounts
- reporting work time information
- switching jobs
In relationships with colleagues
- sexual harassment
- taking advantage
Related to competitors
- False claims
- Sabotaging

Illegal Business Practices
Business defamation
Unfair/untrue statements to buyer about competitor or its salespeople
Reciprocity
Special relationship in which two firms buy products from each other
Tying agreement
Buyer is required to purchase one product in order to get another
Conspiracy
An agreement between competitors before customers are contacted
Collusion
Competitors working together while the customer is making a purchase decision
Resale price maintenance
Mimimum price below which distributors/retailers should not resell the products
Spiff (push money)
Special incentives to get a resellers salespeople to push products
Breach privacy laws
Obtain private information about a consumer & illegally use or share it
Do not call register
Call numbers registered on do-not-call register

International Ethical Issues
Lubrication (UNETHICAL)
Paying small sums of money/gifts to low ranking managers/government officials in
countries where these payments are not illegal
Subordination (ILLEGAL)
Paying larger sums of money to higher-ranking officials to get them to do something that
is illegal or to ignore an illegal act

What to do if ethical standard differ
Cultural relativism
View that no cultures ethics are superior

Ethical Imperialism
View that ethical standards in ones home country should be applied to ones behaviour
across the world

Building long-term relationships

Phases of relationship development
Awareness

Exploration Set right expectations, monitor order processing, follow up, handle
complaints
Expansion Generate repeat orders, upgrade/upsell, cross-selling
Commitment Secure commitment to a partnership, communication, corporate culture
Dissolution

Criteria required to gain preferred supplier status
- Hard savings (payment terms, quality/innovation, supply chain management)
- Soft savings (commercial, global incentives, improve process, quality and
innovation

Direct communication between partners
Buyer-supplier interface traditional
Buyer-supplier interface team

Change & resistance
Rate of change slow/fast
Scope of change narrow/broad

Moderate resistance narrow/fast
Little resistance narrow/slow
Major resistance broad/fast
Moderate resistance broad/slow

How to overcome resistance to change:
Identify champions
Position the change
Determine the necessary resources
Develop a time-based strategy

Phases of relationship development:
Reasons:
- limited personal relationships
- failure to monitor competitors actions/industry
- falling into complacency
- conflict

Relationships with customers
Deception deliberately presenting inaccurate information
Bribes payments made to buyers to influence their purchase decisions
Kickbacks payments made to buyers based on amount of orders placed
Special treatment upsets other customers, reduces salespersons productivity
Confidential information disclosing confidential information - untrustworthy
Backdoor selling salespeople ignore the purchasing agents policy/contact directly


CH 12 - Managing within your company
Internal partnerships
Relationships within company required
- sell customers needs to their companies
- carry the customers voice across the organisation

Principles of selling internally

Accept responsibility
Appeal to higher objective
Understand the personal/professional needs
Address the internal customer needs
Increase the internal customers sense of urgency
Never personalise
Negotiate

Company areas important to salespeople
Manufacturing
Tasks: manufacturing interests: long term production, little customisation, low
inventories. Customer interests: fast delivery, made to order, high product availability
Responsibilities: Facilitate customer co-creation

Administration
Tasks: Order entry, billing, credit, employee compensation, decide over scheduling
Responsibility: help collect payment, complete paperwork quickly/accurately

Customer service
Tasks:

Technical services, call centre
Responsibility:
Acquire knowledge about customer, help training customers

Shipping
Tasks:
Decide over scheduling
Knowledge: Consult before making promise

Marketing
Tasks:

Planning, product, promotion, pricing, distribution
Responsibility:
Pass on information, pass on leads

Sales
Tasks:

Account team manager, sales manager, other reps
Responsibility:
Coordinate with

Sales management:
Sales executives:
Top of hierarchy, determine company strategies, determine size of sales-force & long-
run plan, monitor & control sales-force

Sales force size/organisation:
Determined by executive, number, type, depends on: what is required to achieve
companies sales/customer satisfaction goals

Forecasting:
Best practice: Bottom up forecasting, check for under & over estimation

Expense budgets:
Allocate budget for salesperson expenses, Incentive: bonus, but underspending problem

Control & quota setting:
Set minimum performance requirements, sales quota, revenue quota, activity quota,
Quota: quantitative minimum level of acceptable performance for a specific period

Compensation/evaluation:
Salary, incentive pay (commission/bonus), straight salary method, combination plas

Field sales managers
- Evaluate performance
- Training

Managing ethics in sales
Sales executive & sales field manager
Responsibilities:
- Determine corporate policy regarding ethics
- Including: monitoring, punishing, rewarding
- Open-door policy
- Be ethics role model
- Include ethics in trainings


Strategies for handling unethical requests
- Leave the organisation/ask for transfer
- Negotiate an alternative course of action
- Blow the whistle, internally/externally
- Threaten to blow the whistle
- Appeal to higher authority
- Agree to demand/dont carry it out

Salespeople as partners
- Geographic salespeople
- Customer support reps
- Field support reps
- Product specialists
- House accounts managers
- National/strategic account managers
- Key account managers