Beruflich Dokumente
Kultur Dokumente
Chapter
1
Sales
Management Strategy
1-1 Sales and Distribution Management Text & Cases (2nd Edition) S L Gupta Excel Books
Block: Basics of Sales Management
I Ch-1 Sales Management Strategy
Introduction
Sales management is defined as “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”.
Sales force is responsible for the sale of products of a company and to add profit
to the business operations and fulfill social obligations. Sales force should be
hardworking, result oriented, well educated and competent to handle changing
situations. Technical developments which are taking place at a rapid speed have
made the task of sales force more challenging.
Copyright © 2010, S L Gupta
1-2 Sales and Distribution Management Text & Cases (2nd Edition) S L Gupta Excel Books
Block: Basics of Sales Management
I Ch-1 Sales Management Strategy
1-3 Sales and Distribution Management Text & Cases (2nd Edition) S L Gupta Excel Books
Block: Basics of Sales Management
I Ch-1 Sales Management Strategy
Relationship-based selling
Relationship-based selling works because people would rather buy what they
need to buy anyway from those they have come to relationship.
The objective of relationship selling is to help the buyer do the right thing for
the buyer.
1-4 Sales and Distribution Management Text & Cases (2nd Edition) S L Gupta Excel Books
Block: Basics of Sales Management
I Ch-1 Sales Management Strategy
1-5 Sales and Distribution Management Text & Cases (2nd Edition) S L Gupta Excel Books
Block: Basics of Sales Management
I Ch-1 Sales Management Strategy
1-6 Sales and Distribution Management Text & Cases (2nd Edition) S L Gupta Excel Books
Block: Basics of Sales Management
I Ch-1 Sales Management Strategy
2. Getting the best output from the sales force under him.
1-7 Sales and Distribution Management Text & Cases (2nd Edition) S L Gupta Excel Books
Block: Basics of Sales Management
I Ch-1 Sales Management Strategy
In the table that follows, Al Reid gives the steps necessary for getting
success in selling:
Territory Sales Manager’s Job Responsibilities
1-8 Sales and Distribution Management Text & Cases (2nd Edition) S L Gupta Excel Books
Block: Basics of Sales Management
I Ch-1 Sales Management Strategy
Grow, so that you can assume Cut selling costs by economical Inform the customers about the
greater responsibilities as routing, good use of time, trends in their areas.
opportunities permit. planning and greater awareness
of opportunity. Handle complaints effectively
Maintain the appearance and and to the complete satisfaction
goodwill expected of a territory Check demand and movement of the complainants.
sales manager. of products in the territory.
Suggest the best technique for
Analyse your weak and strong Report activities of the selling your products to the
points and then think about competitors. customers.
them.
Strive to reach the best goals. Organise presentations to
inform and save time.
Ask for help, when you need it.
Make the customers aware of
Cooperate with other the changes in the company’s
departments of the company. policies or procedures.
1-9 Sales and Distribution Management Text & Cases (2nd Edition) S L Gupta Excel Books
Block: Basics of Sales Management
I Ch-1 Sales Management Strategy
Actual supervision of, and guidance to, individual salesmen is also a sine
qua non of a sound sales manager.
1-10 Sales and Distribution Management Text & Cases (2nd Edition) S L Gupta Excel Books
Block: Basics of Sales Management
I Ch-1 Sales Management Strategy
3. Target-setting
Sales targets are fixed on the basis of past experience, time period and
brand positioning in the market. The targets should be fixed in such a manner
that they are achievable.
4. Sales Forecasting
1-11 Sales and Distribution Management Text & Cases (2nd Edition) S L Gupta Excel Books
Block: Basics of Sales Management
I Ch-1 Sales Management Strategy
1-12 Sales and Distribution Management Text & Cases (2nd Edition) S L Gupta Excel Books
Block: Basics of Sales Management
I Ch-1 Sales Management Strategy
Relationship Strategy
The sales force that builds effective relationships with the customer and
provides valuable service are usually high performers and top achievers.
Cont….
Copyright © 2010, S L Gupta
1-13 Sales and Distribution Management Text & Cases (2nd Edition) S L Gupta Excel Books
Block: Basics of Sales Management
I Ch-1 Sales Management Strategy
A Selling Partner
A Selling Partner
P - Prepares strategically for a long-term, high-quality relationship that
P - Prepares strategically for a long-term, high-quality relationship that
solves customer’s problems.
solves customer’s problems.
A - Asks questions to get on the customer’s agenda.
A - Asks questions to get on the customer’s agenda.
R - Restates customer needs with confirmation questions.
R - Restates customer needs with confirmation questions.
T - Teams with support people to provide the customer with solutions.
T - Teams with support people to provide the customer with solutions.
N - Negotiates double-win solutions with joint decision making.
N - Negotiates double-win solutions with joint decision making.
E - Exceeds customer expectations whenever possible.
E - Exceeds customer expectations whenever possible.
R - Re-examines the ongoing quality of the relationship frequently.
R - Re-examines the ongoing quality of the relationship frequently.
In this model, a customer is treated as a partner. Therefore, maintaining a good
relationship with the customer is important.
Cont….
Copyright © 2010, S L Gupta
1-14 Sales and Distribution Management Text & Cases (2nd Edition) S L Gupta Excel Books
Block: Basics of Sales Management
I Ch-1 Sales Management Strategy
In this strategy, both the customer and the salesperson come out of the sale
with a sense of satisfaction. The salesperson not only obtains the order but
sets the stage for a long-term relationship, repeat business and future referrals.
They both come out of the sale feeling satisfied, knowing that neither has
taken advantage of the other and that both have profited, personally and
professionally, from the transaction.
However, some salespeople have still not accepted the merits of the win-win
approach. They have adopted a win-lose approach which means that the
salesperson wins at the buyer’s expense.
Cont….
Copyright © 2010, S L Gupta
1-15 Sales and Distribution Management Text & Cases (2nd Edition) S L Gupta Excel Books
Block: Basics of Sales Management
I Ch-1 Sales Management Strategy
1-16 Sales and Distribution Management Text & Cases (2nd Edition) S L Gupta Excel Books
Block: Basics of Sales Management
I Ch-1 Sales Management Strategy
Instant Service
It is in this context of providing almost “instant service” to the customer that
the concept of “supply chain management” has caught the imagination of
managements the world over.
No matter how efficiently and effectively goods/services are produced, if they
cannot be delivered to the customer in the quickest possible time, all efforts
made earlier are in vain, particularly in the context of very short product life
cycle – counted in months rather than years.
As depicted in Figure below, a combination of effective process plus supply
chain management is what is required to cope with the challenges of the
international market-place.
One cannot survive in a highly competitive market without conforming to the
so called Q-C-D triangle – Highest Quality, Lowest Cost and Least Delivery
times. Cont….
Copyright © 2010, S L Gupta
1-17 Sales and Distribution Management Text & Cases (2nd Edition) S L Gupta Excel Books
Block: Basics of Sales Management
I Ch-1 Sales Management Strategy
Exceeding customer
Customer expectations
Delight
On time delivery
leading to customer
loyalty and lasting Cont….
relationship Copyright © 2010, S L Gupta
1-18 Sales and Distribution Management Text & Cases (2nd Edition) S L Gupta Excel Books
Block: Basics of Sales Management
I Ch-1 Sales Management Strategy
Cont….
Copyright © 2010, S L Gupta
1-19 Sales and Distribution Management Text & Cases (2nd Edition) S L Gupta Excel Books
Block: Basics of Sales Management
I Ch-1 Sales Management Strategy
1-20 Sales and Distribution Management Text & Cases (2nd Edition) S L Gupta Excel Books
Block: Basics of Sales Management
I Ch-1 Sales Management Strategy
Selling Process
The selling process is defined as a process by which a salesperson identifies
and locates the prospects, separates the prospects from the suspects
approaches them and makes a sales presentation, handles their objections.
He also follows up the existing customers to identify further sales leads and
measures the success and customer satisfaction level of the current products
and service offerings.
Selling concept refers to the exchange of goods or services for an amount of
money or its equivalent in kind. Selling helps an organization achieve its
organizational goals. Thus, managing sales in an organization is a critical
activity. A sales manager needs to ensure that the salesman are motivated
to give their best performance.
The sales team continuously look out the changes taking place in the
external environment regarding competitors, customers, government policy
and other regulatory agencies, advances in technology, and industry trends.
This provides the sales personnel a vital information regarding trends in product
sales, product development, and budgets. Cont…. Copyright © 2010, S L Gupta
1-21 Sales and Distribution Management Text & Cases (2nd Edition) S L Gupta Excel Books
Block: Basics of Sales Management
I Ch-1 Sales Management Strategy
1-22 Sales and Distribution Management Text & Cases (2nd Edition) S L Gupta Excel Books
Block: Basics of Sales Management
I Ch-1 Sales Management Strategy
Mail order houses are retail trading organisations engaged in the mail order
business.
Cont….
Copyright © 2010, S L Gupta
1-23 Sales and Distribution Management Text & Cases (2nd Edition) S L Gupta Excel Books
Block: Basics of Sales Management
I Ch-1 Sales Management Strategy
In case of the mail order business, the selling function is performed without
the intervention of the personal salesman.
The goods should be known for their utility so that there is no need of
convincing prospective buyers about their usefulness.
Cont….
Copyright © 2010, S L Gupta
1-24 Sales and Distribution Management Text & Cases (2nd Edition) S L Gupta Excel Books
Block: Basics of Sales Management
I Ch-1 Sales Management Strategy
1-25 Sales and Distribution Management Text & Cases (2nd Edition) S L Gupta Excel Books
Block: Basics of Sales Management
I Ch-1 Sales Management Strategy
Storing or warehousing
Transporting
Financing
Risk-bearing
1-26 Sales and Distribution Management Text & Cases (2nd Edition) S L Gupta Excel Books
Block: Basics of Sales Management
I Ch-1 Sales Management Strategy
In the process of acting as a link between the wholesaler and the consumer,
a retailer performs many functions. The more important of them are given
below:
Warehousing or storing
Selling
Financing
Advertising. Cont….
Copyright © 2010, S L Gupta
1-27 Sales and Distribution Management Text & Cases (2nd Edition) S L Gupta Excel Books
Block: Basics of Sales Management
I Ch-1 Sales Management Strategy
Direct Selling
THE STRATEGY: Eureka Forbes structures its demos according to the time
at the customer’s disposal.
1-28 Sales and Distribution Management Text & Cases (2nd Edition) S L Gupta Excel Books
Block: Basics of Sales Management
I Ch-1 Sales Management Strategy
Follow up sale
with prompt
service
Ensure
increase in
Is the Is salesman customer value
process clearly empowered to be
structured? flexible?
Yes Yes
No Yes
Cont….
Copyright © 2010, S L Gupta
1-29 Sales and Distribution Management Text & Cases (2nd Edition) S L Gupta Excel Books
Block: Basics of Sales Management
I Ch-1 Sales Management Strategy
THE STRATEGY: Modi Telstra uses a clearly structured sales call process to
market its cell phone services.
THE LESSON: Use your customer to sell your product to other customers.
THE STRATEGY: INDAL empowers its sales force to take pricing decisions
on the spot when closing sales.
THE LESSON: Ensure that your direct seller can conclude a deal
immediately.
Copyright © 2010, S L Gupta
1-30 Sales and Distribution Management Text & Cases (2nd Edition) S L Gupta Excel Books
Block: Basics of Sales Management
I Ch-1 Sales Management Strategy
1-31 Sales and Distribution Management Text & Cases (2nd Edition) S L Gupta Excel Books
Block: Basics of Sales Management
I Ch-1 Sales Management Strategy
Sales Manager
Regional Manager Regional Manager Regional Manager Regional Manager Regional Manager
(North) (South) (East) (West) (Staff)
BM BM BM BM BM BM BM BM BM BM BM BM BM BM BM BM BM BM BM BM
Field Staff Field Staff Field Staff Field Staff Field Staff
Cont….
Copyright © 2010, S L Gupta
1-32 Sales and Distribution Management Text & Cases (2nd Edition) S L Gupta Excel Books
Block: Basics of Sales Management
I Ch-1 Sales Management Strategy
The stand points of sales representatives and the managers are as follows:
Cont….
Copyright © 2010, S L Gupta
1-33 Sales and Distribution Management Text & Cases (2nd Edition) S L Gupta Excel Books
Block: Basics of Sales Management
I Ch-1 Sales Management Strategy
1. Financial
2. Non-Financial
But monetary compensation is one of the most direct and least ambiguous ways
of communicating to sales people about their performance.
1-34 Sales and Distribution Management Text & Cases (2nd Edition) S L Gupta Excel Books
Block: Basics of Sales Management
I Ch-1 Sales Management Strategy
2. The plan should be simple and easy to understand for the salesman.
1-35 Sales and Distribution Management Text & Cases (2nd Edition) S L Gupta Excel Books
Block: Basics of Sales Management
I Ch-1 Sales Management Strategy
Methods of Remuneration
The sales force can be remunerated in the following ways:
1. A straight salary
5. Salary and different rate of commission on varying totals or for different types
of goods
1-36 Sales and Distribution Management Text & Cases (2nd Edition) S L Gupta Excel Books
Block: Basics of Sales Management
I Ch-1 Sales Management Strategy
Expenses Accounts
The major sales expenses accounts are categorized as follows:
1. Salary accounts
2. Commission accounts
3. Bonuses
4. Meals and entertainment
5. Air travel
6. Automobiles rentals
7. Lodging
8. Travel accounts
9. Tour expenses accounts (Advance accounts)
10. Communication and services expenses accounts. Copyright © 2010, S L Gupta
1-37 Sales and Distribution Management Text & Cases (2nd Edition) S L Gupta Excel Books
Block: Basics of Sales Management
I Ch-1 Sales Management Strategy
Fringe Benefits
Types of fringe benefits are:
1. Company Car
2. Supplemental life insurance and medical insurance
3. Tax-return preparation
4. Personal tax and financial planning
5. Low or no interest loans
6. Deferred compensation
7. Supplemental retirement benefits
8. Air travel and First class A.C. for Train Travel
9. Relocation allowance
Cont….
1-38 Sales and Distribution Management Text & Cases (2nd Edition) S L Gupta Excel Books
Block: Basics of Sales Management
I Ch-1 Sales Management Strategy
1-39 Sales and Distribution Management Text & Cases (2nd Edition) S L Gupta Excel Books