SDM

2018
LONG ANSWERS
a. Functions of Sales Management 

1.Sales Planning-
Sales Planning is the first functions of sales management and it means
that the role of a sales manager is to facilitate planning. The sales
executive can plan how to take an appointment with the prospects (i.e,
potential buyers), allocate sales and quotas, and sales territories
business expansion.
This point is also helps to identify the target market of a sales
individual.

2. Recruitment and Selection-

Recruitment is the second functions of sales
organisation/ management and it means that the sales manager recruit
the right person or individual with appropriate selling skills and select
him for a sales job. This function is very essential for the sales
department because it helps to choose the effective manager or
employee for the organization.
The recruitment can be classified into two categories such as an
internal source of recruitment and external source of recruitment.

3. Training-
Training is the third functions of sales management and it means, it is
a very important function of sales manager. Since it enhances the
skills, potential, knowledge, and ability of a salesperson to take
challenging jobs and perform effectively.
If an organization wants to increase the sales potential of sales
executives then it will have to provide proper training facilities and
development programs also.
5. Equipping-
Equipping is the fifth functions of sales organisation/management and
it means that the sales manager equipped the sales team so that the
team is ready with templates, brochures, price list, yellow papers,
hoardings which can facilitate the sales.

6. Relationship Building-
The relationship is the sixth functions of sales management and it
means that the critical task of a sales manager is to acquire the
prospects, grow the customers, build the customers, manage the
customers and retain them through relationship marketing.
7. Attainment of Sales Target-
Attainment factor is the seventh functions of sales
organisation/management and it means that the ultimate objective of a
sales manager is to maximize the sales revenue. He will be
responsible for the attainment of sales target by himself and also by
the team.
Thus, the achievement of a sales target helps to grow the business or
an organization in an effective or efficient manner.

8. Delegation-
Delegation is the eighth functions of sales
department/management and it means that the degree of control
and accountability is possible through delegation. There will be a
grouping of jobs along with the concerned authority so that work is
completed within a stipulated period of time.
However, delegation is also known as the transfer of something (it
can be work, power, etc).

9. Supervising-
Supervising is the ninth functions of sales
management/representative and it means that the task of the sales
manager is to supervise the actions of sales executives so that he can
rectify any deviations if possible.
10. Allotment of Sales Territories-
Allotment strategy is the tenth functions of sales manager and it
means that the sales territories refer to the grouping of customers over
a particular area. Companies allot sales territories to sales
representatives so that there is complete the coverage of the market.

11. Sales Budget Preparation-

The sales budget is the twelfth functions of a sales manager and it
means that they comprise of personal selling function expenses,
expenses involved in transportation, promotional expenses, tele-
calling expenses and so on.

12. Communication-
Communication is the thirteenth functions of sales management and it
means that the sales manager maintains proper communication
between various sales executives and inform the top level of
management about the sales targets or revenue attained.

13. Sales Controlling-

The sales controlling is the fourteenth functions of sales
management and it means if there is the deviation in actual sales then
the salesperson makes corrections sales targets attained so that
mismatch between actual sales and desired sales could be minimized.

b. Sales planning:
Sales Planning is a key function in the procedure of sales
management process. Sales planning is an effective method that
involves sales forecasting, demand management, setting profit-based
sales targets, and the written execution steps of a sales plan.
Sales Planning is the process of organizing activities that are
mandatory to achieve business goals. A sales plan contains a strategic
document that figures out your business targets and several
resources. These can be used for some activities which you perform
to reach your desired goal.
Half done
 c. Sources of salesperson recruitment
1. Recruitment of Salespersons from among the existing
employees
Preference may be given to the existing employees of the concern.
Employees working in other departments may be considered if they
possess the desired qualification, aptitude and attitude for a sales
career. Some of the advantages of selecting from within the
organization are:

1. They can be easily assessed, as their service records are already

available.

2. Such people are supposed to be more loyal and sincere.

3. The initial training to be given (called induction training) is not

necessary as they are already familiar with the organization.

4. Better control can be exercised over their activities as they are not
strangers. To quote the proverb here ‘known devil is better than an
unknown angel will be more appropriate.

5. As the person is already an employee of the concern, he need not

be paid a very high remuneration.

Limitations of selecting salespersons from within organization

Selection from within the organization has certain limitations too.
These are

1. People without any aptitude for selling may get selected.

2. As the selected persons are already employees of the same
concern, they may adopt a casual approach towards the work.
3. Such a method prevents dynamic youngsters, from outside the
concern, from getting selected.
2. Recruitment of Salespersons through Newspaper
advertisements
The vacancy may be notified by way of newspaper advertisements.
The nature of work, the qualification expected, previous selling
experience, salary offered, etc., will be usually specified in the
advertisement itself. Interested persons may be asked to apply along
with their bio-data within a stipulated time. Job seekers also advertise
in newspapers. The employer may keep the particulars of such
individuals and inform those who are found good.

3. Recruitment of Salespersons through Employment exchanges

The Government run employment exchanges may be contacted in this
regard. The employer may request such employment exchanges to
furnish a list of eligible candidates. There are also private
employment consultants and bureaus that provide valuable
information on such matters.

4. Recruitment of Salespersons through Campus interviews

Another popular method of recruitment these days is what is known
as ‘campus interview’. By this it is meant that the employers will visit
colleges and universities at a particular period of time every year and
interview the students studying certain degree courses. Usually, the
eligible final year students will be interviewed. Those found suitable
will be given the placement orders immediately. Such selected
persons can join the concerns after completing their degree course.

5. Recruitment of Salespersons from competitors

Salespersons working for the competitors may be lured with better
perquisites. The ethics in such a practice has been a matter of
controversy. The advantage of such an approach is that the
salespersons selected are already well versed in the particular line of
business and therefore can perform their work more effectively. Such
people do not require much training. But the drawback of such an
approach is that the salespersons may not be loyal. If some other
businessman tempts them with even greater perquisites, they may
ditch the present employer and go.

6. Recruitment of Salespersons from unsolicited applications

Renowned organizations receive a number of applications frequently
from the unemployed graduates although the concern has not called
for applications. The personnel department of the concern may
maintain a record of all such applications for future consideration.
Any candidate found suitable may be informed when a vacancy
arises.

7. Recruitment of Salespersons by recommendation

Another important source of recruitment is that the employer may be
informed of a suitable candidate for a job in the concern.
Such a recommendation may come either from an employee of the
organization or from any friend or relative of the employer.

d. Functions channel members in distribution channel

1. Risk taking –
Assuming the risk connected with carrying out channel
work or being a part of a channel. If the distributor or
channel member is buying a product, it does not sell, or the
distributor suffers bad debts or any untoward thing
happens, then these are risks which the channel member
has to take and it is the function of channel member.

2. Financing –
Most companies deal in advance payments or a credit
limit. However, it is not necessary that the channel
member is getting the payments from customers within
that period of time. A company might take advance
payment for product X but maybe that product sold after
40 days. So till 40 days, the financial burden of that
product was on the channel member. Channel member
should be ready for such financing.

3. Physical distribution of goods 

 Look at any channel driven company and you will find
that there are different modes to reach the end customer.
The company is responsible for delivering the product to
channel member. But it is the function of channel
 members to ensure that the goods are distributed to end
customer at the earliest and in optimum condition.

4. Negotiations –
All negotiations with the end customers is done by channel
members and the company does not take part. Once a
product has been purchased by the channel member, it
belongs to the channel member, and the sale of the same
depends on the channel member as well.

5. Inventory management –
The distributor or dealer has to match the inventory which
is in demand in the market, and which is in his stock. He
should not uselessly order material which is not being sold
in the market because this will block the dealers inventory
and finances.

6. Contacts –
Maintaining contacts with existing customers as well
establishing contacts with potential customers and sharing
the same with the company is the work of channel dealers.
Good companies also enable their dealers to maintain
a CRM and use it for better customer retention.

7. Promotions –
Promotions are not only done at the company level
or brand level, but they are done quite a bit on the channel
level as well. Whenever a dealer or distributor wants to
create more brand awareness and let customers know
about the buying point for the brand, at that time he uses
marketing and promotions to attract customers to him.
This is in fact an inherent function of channel members –
to increase sales in their locality.
 8. Information –
Gathering information about potential customers,
competition as well as tracking the environmental factors
is a function of channel member. He is intricately involved
in making marketing strategies for the company, because
without information from the channel member, the
company cannot move in the right direction.

e. Advantages of On the Job Training

 Simplicity
Yes..the training process that is involved with this method is
quite simple to understand as it particularly only focuses on
the company. It can be learned through experimentation
process itself and doesn’t need a formal classroom structure
coupled with teachers for training.

 Economy

OJT is economical in the sense that it does not require extra cost
burden for arranging training needs. Moreover, it does not require
separate training space to provide training.

 Actual Work Station

OJT is conducted at the actual workstation; hence, employees can get

the first-hand experience from the job as they learn it through actual
equipment and materials.

 Immediate Productivity

Since trainees are involved in the actual work process, quick learning
and immediate productivity will be obtained from the work performed
by the trainees.
  Quick Learning

OJT provides a favorable environment for quick learning. This is

because trainees are involved in the actual work process.

 Multi-skill

As it is a practical approach, it develops multi-skill in trainees. The

employees can get quick feedback about the correctness of their
performance.

Disadvantages of ‘On the Job’ Training:

1. Low Productivity rates will occur:

As the trainees or the employees are actually taken to the real work
station for the training process, they will only be in the progression of
acquiring and learning the necessary skills. As a result, the
organizational productivity as one single unit will be lowered
considerably.

2. Errors On Production will also occur:

Since the concerned employees are not mixed up with any of the
company’s day to day production activities, there will be a huge
possibility of the occurrence of errors on the overall production
activities. On the other hand, the goods that were produced by the
skilled trainers will be of a qualitative nature.

3. Costly both monetarily and physically:

On-the-Job Training method is expensive in the sense that the

workers are distressed by the ongoing training activities; the goods
produced by the learning trainees will be of considerably less quality
and there will be huge chances of damaging the goods permanently.
These all will result only in the higher cost of production rates.

4. Disturbance arises:

A large commotion may happen during the everyday work process as

the trainees are still in their learning phase only. The existing and
experienced workers may feel troubled due to the interruption of both
the trainees and the supervising members.

5. Possibility Of Accidents:

Beneath OJT, the learners are straight away involved with the real
production process, and they do not have the sufficient knowledge
and dexterity of working with the known equipment and resources.
Hence, the possibility of accidents survives and loom as a huge threat
in the work station.

f. why should the performance of sales person be evaluated

1. To ensure that compensation and otherreward disbursements

are consistent withactual salesperson performance

2. To identify salespeople that might bepromoted

3. To identify salespeople whose employmentshould be terminated and to

supply evidenceto support the need for termination.

4. To determine the specific training andcounseling needs of

individual salespeople andthe overall sales force

5. To provide information for effective humanresource planning

6.To identify criteria that can be used to recruitand select

salespeople in the future
7. To advise salespeople of work expectations
8. To motivate salespeople

9. To help salespeople set career goals

10. To relate salesperson performance to salesorganization goals.

11. To enhance communications beweensalesperson and sales manager.

12.To improve salesperson performance

g. Techniques of evaluating the performance of sales person

Evaluating performance of Salesperson by Sales Target:

The organization sets sales. target for each salesman that he has to
attain. Such targets may be set either on the basis of units to be sold or
based on the value of sales. However, while setting the target it is
important to consider the following points:

1. The target for sales must not be impossible to attain.

2. It must be reasonable.

3. It must be set taking into account the past records, market

potentials, etc.

4. Sales target must not be rigid.

5. The incentives to be given to the salesmen shall be linked to the

targets.

Advantages of fixing sales targets

1. Fixing sales target enables the salesman to work according to a
plan.

2. It provides a basis for the evaluation of the salesman’s

performance.
3. It is possible to coordinate production and sales.

Problems in setting sales targets

1. It is difficult to evolve a basis upon which the target may be set.

2. Certain unpredictable changes in the market conditions may render

the targets unrealistic.

3. The same target cannot be set for all salesmen as the potentials of
each person and each market differ.

Evaluating performance of Salesperson by Sales Territory

A sales territory is a small segment of the entire market for a product
or service. Each salesman is usually made in charge of a particular
area or territory. For the trend in sales in each such area, the salesman
concerned becomes accountable.

Thus, sales territory enables the business to not only evaluate the
performance of the salesman but also to know the sales trend.

Advantages of establishing sales territory

The advantages of establishing sales territory may be mentioned as
follows:

1. It enables the business to cover the entire market more effectively.

2. It makes it possible for the salesman concerned to maintain good

rapport with the clients in his area.

3. It is possible to compare the progress in sales in each territory.

4. It also gives scope to compare the performance of salesmen

working for different territories.

5. It avoids duplication of work by salesmen in the same area.

6. It ensures proper allocation of funds for different territories.

Evaluating performance of Salesperson by Sales report
Salesmen are duty bound to prepare reports on the progress of their
work and forward the same to their organization for necessary action.
As the salesmen are the persons who know the dealers, buyers and
competitors in each area, they are expected to send periodical reports
to their office at regular intervals.

Advantages of sales reports

1. Sales reports enables the concern to take suitable action at the
appropriate time.

2. The report is an evidence of the actual work done by the

salesperson.

3. It helps to evaluate the performance of the salesman.

4. The sales report is also an indicator of the effectiveness of the sales

promotional activities of the business.