Prepared by: Dhaval Motwani

SDM: Dhaval Motwani, MEFGI

Structure of the lecture

Sales Management
Evolution of Sales department Objectives of Sales Management

Scope of Sales Management

Sales Management and Control Sales Control and Organization

SDM: Dhaval Motwani, MEFGI

Evolution of Sales Department

In yester-years, the selling concept was popular The philosophy: Sell what you produce Selling and Marketing were a part time function Industrial revolution saw increase in production in goods of all kinds and descriptions Increase in area of sales coverage leading to increase in problems of hiring workers, land, building, capital etc. Separate departments like manufacturing, finance etc were set up but sales department was set after them The problem of communication let manufacturers to hire middlemen This gave rise to a channel: wholesalers, retailers Manufacturing department became more and more remote from customers Finally the modern day position of sales as an isolated department came up while proper emphasis on marketing and research & development for developing new ideas and product innovations came into picture

SDM: Dhaval Motwani, MEFGI

Responsibilities of Sales
More than just selling Requires analysis, market efficient qualities, implementation skills, time management and route planning, forecasting, persistence etc Also requires them to work in accordance to the organizations culture, objectives and situation Responsibility towards top management Obtain sales volume Provide profit contribution Continue business growth Responsibility towards customers(including wholesalers, retailers or industrial users) Supply easily resalable products and services Support activities like training dealers, provision of credit, help in local advertising Assurance that products and services are wise investments Responsibility towards society Fair pricing Goods which are least damaging to environment

SDM: Dhaval Motwani, MEFGI

Sales management
Definitions committee of American Marketing

Association defined sales management as the planning, direction and control of personal selling including recruiting, selecting, equipping, assigning, routing, supervising, paying and motivating these tasks

SDM: Dhaval Motwani, MEFGI

Sales management-responsibilities
Responsible of personal selling activity
Primarily responsible for management for personal sales force Responsible for organizing sales effort, within and outside the

organization Within the organization: sales manager builds formal and informal structures for effective communication with subordinates and all departments Outside the organization: sales manager serves as a key contact with customers and other public and builds s distribution network Also responsible for budgeting, quotas and fixing territories Serves as a feedback source to R&D department, customer service department, marketing department, personnel department etc
SDM: Dhaval Motwani, MEFGI

Objectives of Sales Management

3 general objectives Sales volume Contribution to profits Continuing growth Sales department carries out the activities leading to the

above objectives however, the final responsibility is with the top management Sales people provide estimates on market and sales potential, sales force capabilities etc based on which reasonably achievable goals are set Sales personnel play a critical plan in implementing the plans to achieve the set goals
SDM: Dhaval Motwani, MEFGI

Sales executive as a Co-ordinator

Sales executives have responsibility for co-ordination

involving
The organization The planning Other elements in the marketing strategy

SDM: Dhaval Motwani, MEFGI

Organization and Co-ordination

Generally the marketing vice-president or director or

marketing or Chief Marketing Officer is responsible for co-ordination of different order-getting methods like personal selling, advertising etc (Eg. Co-ordination with finance dept, HR and activities like product launches etc) Sees to it that order-getting departments will work independently towards the goals Within the sales department all different units are responsible of functioning in co-ordination to achieve a smooth Sales process
SDM: Dhaval Motwani, MEFGI

Planning and Co-ordination

Sales executives are in touch with the market and sales

force A good source of inputs for determining elements like advertising, sales promos, etc that make up the marketing plan Also a good source for budget forecasting the above and target setting Role of market planners essential to achieve sales, profits and growth objectives Sales executive seeks to secure a marketing program which is in line with both, market conditions and probable contributions of the sales force
SDM: Dhaval Motwani, MEFGI

Co-ordination with other elements

Coordination with advertising campaigns, display and

other efforts a must to achieve desired results Proper Sales effort and pitch helps in reinforcement of the facts/information advertised which creates a good brand name Point of purchase displays

SDM: Dhaval Motwani, MEFGI

Co-ordination with distributive network

Gaining product distribution
Obtaining dealer identification Reconciling business goods

Sharing promotional risks

SDM: Dhaval Motwani, MEFGI

 Gaining product distribution

Difficult task Proper convincing on the salability of the new product

to the channel partners by sales staff is required Forced distribution eg. Pressurizing dealers with other means like heavy advertising so that they themselves sell the product Co-ordination of maintaining the stock and timely delivery, timely payouts logistics
SDM: Dhaval Motwani, MEFGI

 Obtaining dealer identification

Proper identification about which dealer stock the goods

needs to be done (for rewards/recognition purpose) Identification of stock holding capacity and selling performance of channel partners/dealers Making signboards, advertising material available to the dealers Customers need to be made aware about such dealers Display at retail showrooms Visibility and availability Proper interior arrangement
SDM: Dhaval Motwani, MEFGI

 Reconciling business goods

Proper coordination helps reduce conflicts between

business goals of manufacturer and middlemen This can be done by

Sharing business information

Sales executives as vehicles of communication Proper training and mentoring of the channel sales force

Ensuring that proper and impartial dealings with all

middlemen and dealers

SDM: Dhaval Motwani, MEFGI

 Sharing promotional risks

Sales executives ensure that sales personnel make

effective presentation designed to convince dealers to participate in co operative advertising Utilization of selective or exclusive agency distribution gives better results Using mass distribution doesnt allow to delegate much promotional authority to middlemen Steps should be taken to make the job of middlemen more interesting, profitable and challenging
SDM: Dhaval Motwani, MEFGI

Co-ordination and implementation of overall Marketing strategy

Overall marketing strategy is implemented in phases Sales and advertising/marketing executives work in co

ordination to reduce time lapses and mistakes Sales department also provides useful information about the intervals between advertisements, customer preferences and culture Also see that every phase is properly carried out at all distribution points Proper feedback for timing of various stages while introduction of new brand Effective implementation
SDM: Dhaval Motwani, MEFGI

Sales management and control

There are various phases of control Sizing up the situation Setting quantitative performance standards Gathering and processing data on actual performance Evaluating performance Action to correct controllable variation Adjusting for uncontrollable variation

SDM: Dhaval Motwani, MEFGI

Sizing up the situation

4 primary questions are asked Where are we now? How did we get here? Where are we going? How do we get there? All the policies and procedures used are revisited while

an attempt to answer these questions is made and corrective measures are taken

SDM: Dhaval Motwani, MEFGI

Setting quantitative performance standards

After finding the weakness, quantitative standards to

measure performance are set A good standard will be one which helps achieve more personal selling efficiency than its costs Should be set by proper and experienced individual Generally, an upper and a lower limit should be set along with danger flags to control the performance

SDM: Dhaval Motwani, MEFGI

Gathering and processing data on actual performance

Information required for comparing it with the set

standards Care to be taken of amount of data, cost of data collection and processing Effects of changes in basic policies and other policies to be taken care of Saving methods to find more data from one source and care of de duplication Timing of data availability very important Use of electronic data processing systems
SDM: Dhaval Motwani, MEFGI

Evaluating performance
Comparison of actual performance with set standards
Classifications into controllable and uncontrollable

departures Uncontrollable departures: war, strike, flood, droughts, earthquake Controllable departures: follow up on leads, selling a balanced line, etc

SDM: Dhaval Motwani, MEFGI

Action to correct controllable variation

Steps for correction are Direction or pointing out more effective ways to perform certain tasks Guidance or additional instructions or training Restraint

SDM: Dhaval Motwani, MEFGI

Adjusting to uncontrollable variation

Adjustments to be made on sales objectives which are

unrealistic because of uncontrollable variations Basic revisions of objectives

SDM: Dhaval Motwani, MEFGI

Sales Control-Formal and Informal

Informal control A dependable machinery to provide facts which help to formulate workable policies and plan of action In small size organizations, it is easy. In large size organisations its difficult because of the distance in hierarchy. Formal control and written sales policies Generally found in large sized organisations Uniformity and proper awareness is very much required Helps save time in problem solving Policy formulation and review Properly set objectives Proper evaluation of tangible information A timely check and improvements/adjustments if required Formal control over sales volume Sales forecasting helps in control and also future planning Industry sales trends, competitors activities, share-of-the-market percentages to be taken care of Budgetary control Control over expenses for sales effort and activities Profit and loss statements for different sales territories, sales units and even sales persons There has to be a balance between decentralization and centralization for all the sales activities.
SDM: Dhaval Motwani, MEFGI