Sales organization

Presented by Under the Guidance of

1.Puja
2.Niraj
3.Rajeev
4.Sneha
 Introduction
Sales Organisation is the organisational unit
which responsible for the selling of the product,
movement of goods to the client, customer right of
recourse.
A sales organization is a structural body through
which the functions of Sales management are
carried out.
This assists the sales manager to carry out needed
tasks efficiently and effectively to achieve results
 Definition:-

The sales organization provides the vehicle for

making decision on product, sale channels,
physical distribution, promotion& price.
A/C to CANDIFF
 Nature of Sales Organization

 An organization is simply an arrangement of

activities involving a group of people.
 The goal is to arrange these
activities so that the people involved can act
better together than they can individually.
 ‡Salespeople are more often apart
of the cross functional team design to serve
specific customers.
Role /Purpose of sales organization.

1. To permit the development of specialist.

2. To assure that all necessary activities are
performed.
3. To achieve coordination or balance.
4. To achievement of company objective
5. To economize on executive time.
 Setting up a sales organization.  
Defining the Objectives.
Determination of activities and their volumes of
Performance.
Grouping activities into positions.
Assignment of personnel to positions.
Provision for coordination and control
 Basic types of sales organizational
structure
1.Line and staff sales organization.
Characteristics: Specialists called as Staff managers are
available for senior marketing / sales managers. Staff
managers· role is to assist / advise line managers. Used
in medium and large size organizations
Merits –
1. Specialized services available.
2. Executive can concentrate more on coordination and
control.
3. Better marketing decision
4. Superior sales performance
Limitation –
Staff work has to be coordinated which is costly.
Close control over staff line relations is essential.
Critical decisions tend to be delayed.
 Marketing
Area sales
Research Sales people
manager 1
Manager

Area sales
Sales manager Sales people
manager 1
Head-Marketing
Promotional Area sales
Sales people
manager manager 1

Customer
service manager
Formal organization
Formal organization have rigid structure and reporting
relationships. It follow the bureaucratic structure.
Advantage:-
1.clear cut reporting relationship
2.Easier to evaluate sales force performance
3.Structured and defined format to perform
4.Clearly defined policies ,procedure and hierarchical relationships
Disadvantage:-
1.Fail to develop cross-functional expertise
2.Lack of flexibility
3.Prevent personal contact between superiors and subordinate
 Informal organization

A informal organization does not have a rigid hierarchical

structure, set communication channels or reporting
relationships.
Adv:-
1.It helps sales personnel to redefine responsibilities and
relationship.
2.It helps positive norms and values within the organization
Disadv:-
1.May not support the establish goals and objective
2.Lead to conflict
 Vertical organizations
It is a traditional management structure with authority being
the basis of control. Vertical organizations have more
hierarchical levels. They are organized as per function such
as sales marketing and Human resource etc.
Advantages:-
1.Functional excellence
2.Smaller span of control
3.Less chances of duplication of control over sub ordinates.
Disadvantages:-
1.Difficulty to co-ordinate various department
2. Complicate the communication of objectives ,policies and
plans
 Horizontal organization
A horizontal organization is one in which both management levels
and department boundaries. They are built around natural work
flows.
Advantages:-
1. reduce the number of hierarchical levels
2. Helps to respond to market changes
3. Facilities teamwork and collaboration among employees.
4. It help improve decision making in an organization.
5. Flexible n less time taken
Disadvantages:
1.Not suited for all level of organization
2.Money consuming
 chairman

G.M.(prod.) G.M.(mktg.) G.M.(R&D)

Manager Regional Chief

manager manager
 Centralization organization
centralized sales organization almost all activities, including
sales force management, are administered from a central
headquarters. The central sales office has full responsibility&
authority.
Adv:-
1.Easier to align sales force activities with the mission n
objective.
2.Suited to small sized organization
3.No conflict between different function
Disadv:-
1.Response time is high.
 Decentralization organization
In the decentralized organization, all these activities are
handled by field sales executives.
Adv:-
1.Better utilization of information and skill
2.Greater flexibility
3. Less response time taken
Disadv:-
1.Increse the organization cost
2.Lead to organizational inefficiencies.
3.Unaware of ground realities on the sales front
Specialization within Sales Organization
 ‡Needed to increase effectiveness of sales force. Done by expanding basic
sales organization.
‡Basis of specialization

 ‡ Geography
 ‡Type of product
 ‡Customer
 ‡Combination of above

‡Criteria for selection ²

(1) nature of product,
(2) sales force abilities,
(3) demands of selling job,
(4) customer and market facts
 Geographical organization
Geographical organization is the one in which selling
personnel are given the responsibility for direct selling
activities in a geographical area. The sales rep is
responsible for selling the firm’s full line of products.
Characteristics: salespeople, assigned geographic areas,
are responsible for all selling activities to all customers
within assigned areas. Branch sales managers adjust
marketing plan to local needs
‡Advantages:
Better market coverage and customer service, more
control over sales force, quick response to local
conditions & competition
‡Disadvantages:
Limited specialization of marketing tasks. Hence, it is
combined with product / market sales organization
 Canada
Americas
U.S.A

Scandinavia

Eastern
C.E.O. Europe
Europe
Country
manager
Western
Europe
Sales force
Australia
Asia pacific
South Asia
Product specialization
Product specialization is one in which selling personnel
concentrate their efforts on particular product lines or
product.
adv:-
1.Reduce the frequency and number of calls on a customer by
salespeople
2.Reduce time n cost in large aspect

Disadv:-
1.Sometimes, more salespeople contact the same customer,
resulting in customer dissatisfaction
 CHAIRMAN

Deputy
Deputy director(new
director(Product
device evaluation) Quality)

Director(toxicology Director(Haematology Director(Microbiology

device) device) device)

Manager(sales)

Sales force
CUSTOMER SPECIALIZATION
Customer Specialization is the sales organization in
which selling personnel are organized by particular
customer or industries
Adv:-
1.Meets needs of specific customer requirement
Disadv:-
1.Lack of co-ordination
 Horizontal
Competency
Units
Vertical
business Units Customer
Regional
business Units
Combination Sales Organization
A structure that combines various types of structure i.e.
Geographic, customer, and product specialization are
the basic approaches to sales organization.
It takes the best of each structure’s individual merits,
while eliminating the demerits associated with it.
Adv:-
1.Flexible n adoptable
Disadv:-
1.High administrative cost
2.Difficult to coordination
Size of the company
Size of the company is a major factor influencing the
organization structure.
For a small company there is likely to be no formal
organization structure.
 If the firm grows beyond the small scale
entrepreneurial stage, the top management must
devote more attention to overall policy and planning
and less time to daily operations.
Middle level management should be developed to take
over the specialized functions of the growing business.
THANKS