Sales, Distribution and Supply Chain Management

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Unit 1

Introduction to Sales Management

Structure: 1.1 Introduction Objectives 1.2 Importance of Sales Management 1.3 Responsibilities of Sales Personnel 1.4 Sales Manager: Role and Skills Sales manager as sales coordinator Sales manager as controller Generating profits Sales manager skills Differences and similarities between a salesperson and a marketer 1.5 Developing a Sales Organization 1.6 Types of Sales Organizations Line and staff components Formal and informal organizations Horizontal and vertical organizations Centralized and decentralized organizations Formulation of sales organization 1.7 Linking Sales and Distribution Management 1.8 Interdependence of Sales and Distribution 1.9 Summary 1.10 Terminal Questions 1.11 Answers

1.1 Introduction
Sales refer to the exchange of goods and services for an amount of money or its equivalent in kind. Sales play a vital role in any company as regards revenue generation. With the growing importance of sales, the concept of sales management has gained a lot of importance these days. Considering this, a well motivated and extremely efficient sales force is an important requirement. With the development of large business operations and an increase in the volumes of production, i.e. production on mass scale not only for local consumption but also to cater of the demand at national and
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global levels, the importance of sales management has increased considerably. As per the Definition given by Committee of the American Marketing Association, 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 management, however, is concerned with the process of encouraging customers to exchange their funds for your services or goods. Effective sales management will help to capture newer markets, retain existing market share, determine profitable levels of sales volume and maintain the revenue earning capacity of the business. Objectives: This introductory unit on sales management will help you get familiar with the concept of sales management and other important aspects of sales. After studying this unit, you should be able to: Explain importance of sales management Discuss various responsibilities of sales personnel Discuss the types and skills of sales manager Identify various types of sales organization

1.2 Importance of Sales Management

Importance of sales management is critical for any organization. In present scenario, expanding business is not possible without increasing sales volumes and the goal of effective sales management is to organize sales team work in such a manner that ensures growing flow of regular customers and increasing amount of sales. Sales management entails: Defining desired corporate results. Working with business partners to ensure goals of both organizations complement one another. Determining the specific activities required to achieve company and partner objectives.
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Implementing a compensation plan that motivates salespeople to achieve corporate objectives. Providing training and coaching to enable salespeople to meet their goals. Establishing appropriate monitoring systems to ensure activities are taking place. Measuring results by evaluating performances on a regular basis

Sales Management achieves the organizations sales goals in an effective and efficient manner with the help of other management functions of planning, staffing, training, leading and controlling organizational resources. Sales planning involve predicting demand for the product and demand on the sales assets (machines, people, or a combination of both). Failure to plan always means lost sales. Planning ensures that when a consumer wishes to purchase the product, the product is available, but it also means opportunities for additional sales are presented and the sales assets are available to exploit these opportunities. Planning should allow for meeting increasing customer demand for more products, services and/or customization as the business is growing, but also react quickly when demand decreases. Sales planning improve efficiency and decreases unfocused and uncoordinated activity within the sales process. Sales tracking is an integral part of ongoing planning and development in sales management. Ideally, sales information should be gathered on the sales process and not on the end result. It includes how many customers you are able to reach, not how many of them are purchasing from you. The fact that you sold ten widgets is valuable for accounting purposes, but the fact that so many were walk-ins, so many were out-bound phone sales, and so many were up-sells, and which sales person or asset did what, would be better information. Tracking the point-of-sales information: Software used for sales tracking should allow sales team leaders to control sales tasks completion by using reminders and notifications, highlighting overdue tasks, analyzing task history, as well as keep detailed information on customers and, as important, the people who didn't buy. The most difficult part of tracking selling activities is ascertaining whether or not the activities can be tracked effectively and economically.
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Timely information: If your sales task management system is really great and duly implemented, the sales manager is informed about all details of your companys sales process in real time and knows who does what, when and how. In the end, management must have measurable methods of knowing if sales representatives are correctly engaging in the activities that produce revenue. This leads to three key metrics: the right activities, the right way and the right amount. An individual sale is a stepwise process and key activities, or Transitional Milestones, must be achieved along the way. Sales management must collect data on how the sales function as a whole, as well as individual sales personnel, are progressing through these Transitional Milestones to determine the likelihood of future revenue. Use of sales reports by internal and external customers: Sales report is made for internal use for top management. And sales reports are required for investors, partners and government, so the sales management system should have advanced reporting capabilities to satisfy the needs of different stakeholders. Self Assessment Questions 1. Increase in the __________ generate revenue for the company. 2. __________ is an integral part of ongoing planning and development in sales management.

1.3 Responsibilities of Sales Personnel

Sales personnel They are the people employed to sell the goods or services (mainly of an organisation). People who are responsible for the sales of either a single product or the entire range of an organization's products can be called sales personnel. Sales personnel normally report to a sales manager. The job of sales personnel involves a number of responsibilities. It is the income producing division of a business. The salesperson is responsible for: Providing profit contribution Creating a proper image for the company and it's products/services Achieving the sales targets of the organization Satisfying the customers and participating in marketing activities
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He/she is responsible to the customer and society for continuing growth of the organization. He has multifarious activities, including setting goals and achieving them, building sales organizations and managing them.

For example, in Eureka Forbes Pvt. Ltd. they called their sales force as sales champs (champions) as they are responsible for the direct marketing of companys products and revenue generation. Qualities of good sales personnel Sales people are the backbone of the organization because they have to face customer and interact with them. Some people say, salesmen are born salesmen, while others believe that training can help in making good salesmen. Irrespective of these opinions, good salesman has certain qualities and abilities as a result he is able to perform better than others. In this section, we will discuss qualities of a good sales person. Philip Kotler has identified two basic qualities of a good sales person namely, empathy and persuasion. Some of the qualities of a good sales person are as follows: Ability to estimate customer's needs and desires: He is alert and quickly determines what the customer wants and the best way to sell. Ambition: He likes to do a good job and is interested in getting ahead with companys goals and sales objectives. Appearance: Appearance means a lot today and the successful salesman is neat and organised. He presents himself well in person. Also, he keeps his desk books and manuals neat and ready for use. Business sense: He is quick to learn the strengths and weaknesses of the company and makes an effort to improvise on the companys strengths. Courtesy: He reveals a sincere desire to help customers and treats them as guests even when he visits their places of business. Creativeness: Imagination, vision and the ability to create ideas make your man dynamic. Enthusiasm: A salesman must radiate enthusiasm during and after the sales call.

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Figure sense: He should have the mathematical ability to figure and fill up order form correctly and to make the necessary reports. Flexibility: A good salesman is able to adapt himself to a variety of customers. Each contact may require a adapting the sales talk, speech habits and even appearance. Friendliness: A salesman should be able to make people like him and he must like to meet people. Health: Good health generates energy and energy is needed to sell. Poor health prevents many salesmen from fulfilling their potentials. Integrity: A salesman must be trusted to do his job well. He cannot help but he successful when his customers trust him. Interest in his job: He likes selling and working for the company. Knowledge: In some business, sales person must also have a through knowledge of the highly specialized products or services his employer offers. In some cases, this knowledge can be gained only by years of experience. Loyalty: He must be able to impress upon his customers the idea that his company is the best in the business. Mental abilities: He has the intelligence to understand your products and those of your competitors. He must know how to use words, to understand and direct people and to remember names and faces. He should also be able to understand prospective customers and know how to act under varying conditions. Motivation: He must have more than just an interest in selling. They live in the present and not in the future. They do want power over others and prefer not to work under close supervision. Self Assessment Questions 3. __________ is responsible for providing profit contribution. 4. __________ is the backbone of the organization because they have to face customer and interact with them.

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1.4 Sales Manager: Role and Skills

The sales manager is the most important person in a sales organization so, all activities are based on his functions and responsibilities. Following are some of the principal duties of a sales manager: Organising sales research, product research and such other research activities. Getting the best output from the sales force under him. Setting and controlling the targets, territories, sales experiences, distribution expenses, etc. Advising the company on various media, sales promotion schemes, etc. Monitoring the company's sales policies. 1.4.1 Sales manager as sales coordinator The sales manager performs the function of a coordinator and ensures that the other departments in the company are well informed of sales activities so that they can produce what is required, when it is required and whether the same can be produced with the existing facilities or it requires changes and so on. The sales manager also carries out coordinating work with the distribution network. 1.4.2 Sales manager as controller Sales manager should act as per the objectives set by the organization and exercise control over his staff so that they may look for advice and may give their best efforts to bring results. He should analyze present condition of the firm, make plans for future and find ways to achieve those plans. 1.4.3 Generating profits Sales department is responsible for the sales of the products at the best available prices in the given circumstances. Salesperson produce volume sales as per targets, and he sell the product at a price which may generate profit for the company. After all it is positive financial results that add position and power to the sales manager and bring credit to the sales department.

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1.4.4 Sales manager skills A sales manager should possess following skills: Active listening: Giving full attention to what other people are saying, taking time to understand the points being made, asking questions as appropriate, and not interrupting at inappropriate times. Speaking: Talking to others to convey information effectively. Mathematics: Using mathematics to solve problems. Time management: Managing one's own time and the time of others. Service orientation: Actively looking for ways to help people. Persuasion: Persuading others to change their minds or behavior. Social perceptiveness: Being aware understanding why they react as they do. of others' written reactions sentences and and

Reading comprehension: Understanding paragraphs in work related documents.

Monitoring: Monitoring/Assessing performance of self, other individuals, or organizations to make improvements or take corrective action. Negotiation: Bringing others together and trying to reconcile differences. 1.4.5 Differences and similarities between a salesperson and a marketer Points that differentiate marketers from sales persons: 1. The marketers perform market research and explore the target markets. 2. They run focus groups and launch various market surveys. 3. They analyze data constantly and develop pricing strategies which is based on a number of business variables. 4. They brand the products and services. 5. They develop and analyze marketing campaigns. 6. They refine and adjust marketing strategies based on data and feedback.

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Points that differentiate salespersons from marketers: 1. Sales personnel are responsible for selling religiously. They need to spend most of their time selling. 2. They interact with customers and prospective customers. 3. They live to present and always look for opportunities to show off their product or service. 4. They are driven by achievement, targets and goals (quotas, sales competitions, financials, etc.) 5. They have a successful track record of selling. 6. They have confidence, know their products inside and out, have a passion for sales, and can overcome obstacles. Although they have many differences, there are a few similarities too. They are listed below. 1. Both marketers and sales personnel work towards common ultimate goal of revenue generation. 2. They both need to be passionate and aware of the current market trends. 3. Sometimes, they both report to a common manager, may be the department head or the marketing manager. 4. Though marketers do not interact with customers very often but still they do need to know about their needs and preferences, like the sales personnel. 5. Sometimes, sales personnel also carry out the work of the marketers and vice versa. Activity 1: Analyse the personality and skills of few of your friends. Do they have qualities to be a good sales person? Self Assessment Questions 5. Organizing sales research & getting the best output out of sales force are duties of a sales manager. (True/False) 6. Negotiation is the job task of a sales manager. (True/False)

1.5 Developing a Sales Organization

Due to intense global competition as well as slow growth in the market any company will require the re-engineering of a sales organizational structure.
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Figure 1.1 a step by step process of developing a sales organization. The objectives of the sales organization are to define the corporate objectives in both quantitative and qualitative term. The step that follows is the identification of the necessary activities that need to be performed if these quantitative and qualitative objectives are to be achieved. Next step is, defining the positional levels at which these activities will be performed. Similar activities and tasks will have to be grouped together and assigned the positions, such that each position has adequate tasks to perform which are also varied enough to provide challenge and motivation. The number of the different classes of activities assigned to a single position would depend upon the degree of specialization associated with each position. The place of an activity in the hierarchy would depend upon the relative importance of that activity for the sales department, for example, in an organization trying to sell a new product through middlemen, dealer relations becomes a crucial activity and has to be assigned to positionshigher up in the sales organization.

Source: Dr. Matin Khan, Sales and Distribution Management, Excel Books.

Figure 1.1: Process of Developing a Sales Organization Sikkim Manipal University Page No. 10

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Once the different positions and the activities associated with them have been decided upon, these positions have to be assigned to personnel. A decision that has to be taken along with the identification of positions, is that of the relationship between these positions in the organization how many individuals would a person have reporting to him, who shall be accountable to whom, which positions in the structure would have the authority to command and which shall only advise and guide. Sales organizations have to be responsive to changing market trends, growth in both products and markets as well as to competitive requirements. While designing a sales organization therefore a key consideration is the provision of flexibility, effective coordination procedures and defined lines of communication. Self Assessment Questions 7. Because of intense global competition and slow growth in the market the company require. __________ of an organization structure. 8. Key considerations while designing a sales organisation are provision of flexibility, effective coordination efforts and defined lines of __________.

1.6 Types of Sales Organizations

Sales organization development refers to the formal, coordinating process of communication, authority and responsibility for sales groups and individuals. An effectively designed sales organization has a framework that enables the organization to serve its customers. Once the sales people know what their responsibilities are and who they report to, they can concentrate on doing their expected jobs to the best of their ability. Thus, a sales manager must recognise and deal with some basic problems faced by organizations, when developing his own sales organization. The sales organization structure can be: Line and staff components of organizations, Formal and informal organizations, Horizontal and vertical organizations, Centralized and decentralized organizations 1.6.1 Line and staff components Marketing organizations also feature line and staff components. A line function is a primary activity and a staff function is a supporting activity. In a marketing organization, the selling function is the line component whereas
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advertising, marketing research, marketing planning, sales training and distributor relations are usually considered staff roles. Although the use of the terms line and staff has been criticized in many quarters, the basic premise behind them remains applicable to marketing organizations. A modern sales force has to receive various types of support in order to accomplish its objectives. Advertising and sales promotional support is needed to precondition the prospect to accept the salesperson's presentation; marketing research and sales planning are required because they allow field representatives to concentrate their efforts on the largest potential markets; in-house sales correspondents relieve the field force of activities that would distract them from their basic efforts; and distribution, credit, and maintenance of personnel ensure that the customer is satisfied with the purchase.

Figure 1.2: A Line Marketing Organization

Some firms operate with a simple line marketing organization such as the one shown in Figure 1.2. Here, a marketing organization is simply the sales organization. This type of arrangement may be satisfactory for small firms in basic industrial markets. Figure 1.3 demonstrates several key aspects of a large-scale marketing organization. First, the Chief Marketing Officer is typically called the Vice President for Marketing or Director of Marketing, rather than Vice President of Sales. The title change is indicative of the person's added responsibilities under a line and staff structure. The Vice President for Marketing is in charge of more than just the field sales force. The line and staff organization shown in Figure 1.3 indicates that all marketing activities have been grouped together, suggesting that the basic tenets of the marketing concept have been accepted.
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Figure 1.3: Line and Staff Marketing Organization

Second, staff activities report to the line position that they support. Distributor relations, sales planning, sales analysis and sales training are considered to be directly supportive of the field sales effort so these departments report to the General Sales Manager. By contrast, marketing research and advertising are broader functions and they report to the Vice President for Marketing. 1.6.2 Formal and informal organizations Every firm has a formal and an informal organization. The formal organization is a fixed set of rules of intra organization procedure and structure that of the management whereas the informal organization is often developed from the informal relationships existing within the organization. Also called the grapevine, informal organization is basically a communications pattern that emerges to facilitate the operation of its formal counterpart. Most formal organizations would be totally ineffective if it were not for a supportive informal organization. Figure 1.4 shows an informal communications pattern that might exist in a marketing organization. Actual communications do not usually follow the formal organizational lines. This allows the formal structure to operate efficiently.

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Figure 1.4: Informal Communication System in a Marketing Organization

Consider the case of a field salesperson who is responsible for collecting certain competitive information such as prices and trade discounts. If this information were forwarded through the formal organization (Figure 1.5) the data would be so backdated that it would be useless to the management. The informal communication system, however, allows the information to be transmitted directly to the director of marketing research. Similarly, consumer complaints over delays in correcting billing errors can be mitigated when the district sales manager directly contacts the head of accounts.

Figure 1.5: A Lengthy Formal Communications

The development of an effective sales organization requires that informal relationships and communication patterns be recognised as being equally useful in accomplishing sales objectives. They should be encouraged to the extent that they improve organizational efficiency. 1.6.3 Horizontal and vertical organizations A sales force can have either a horizontal or a vertical organizational format. This arrangement varies among companies even within the same industry.
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A purely vertical sales organization would be similar to the structure represented in Figure 1.6. In this structure, there are several layers of sales management all of which report vertically.

Figure 1.6: Vertical Sales Organization

The other extreme is a horizontal organization, shown in Figure 1.7. Here the number of management levels is reduced appreciably, but the number of managers at any particular level is increased. Instead of two or three district sales managers, there may be seven or eight. The factor that determines whether a vertical or horizontal organizational structure should be employed is the effective span of control. The span of control refers to the number of employees who report to the next higher level in the organization. Horizontal structures tend to exist where larger spans of control are acceptable, while vertical organizations characterise cases in which closer managerial supervision is required. It is difficult to generalise how to set guidelines for appropriate spans of control. It appears that the optimum span of control is reduced as the type of selling becomes more technical or complex. With this in mind, approximate guidelines for setting reasonable spans of control are: trade selling 12 to 1; consumer service selling 10 to 1; missionary selling 10 to 1; and technical or industrial selling 6 to 1. While these guidelines may seem appropriate, it must be remembered that they are only guidelines. Each company must determine the span of control that works best for its sales organization. Once set, the span of control should be monitored periodically in order to assure maximum effectiveness.
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Figure 1.7: Horizontal Sales Organization

1.6.4 Centralized and decentralized organizations In a decentralised organization, responsibility and authority are delegated to lower levels of sales management while in a centralised sales organization; the responsibility and authority for decisions are concentrated at higher levels of management you find higher degree of decentralization as an organization grows in size. Expansion results with top executives being less able to deal with the range of decisions that they handled when the organization was small. By necessity, these decisions are then shifted downwards in the organization. A decentralised organization structure is ineffective unless commensurate responsibility and authority accompany the assignment of decisions to a specific level of sales management. A classic mistake is for the top management to charge a field sales supervisor with the responsibility to perform a particular task, and then fail to grant the related authority to accomplish the same. This type of mistake should be avoided, since it results in poor morale as well as failure. 1.6.5 Formulation of sales organization As seen in the Figure 1.8, the formulation of sales organization is a three step process. Step 1 Sales Strategy: The first step is to segment the population into different categories, by using various methods of segmentation. The population can be segmented on the basis of demographics, location, psychographics etc. Mostly the segments with similar sales processes are identified so that they could be easily targeted by the sales organization.
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After deciding on the segments, the products and services that relate to each decided segment is specified. Effectively reaching the segments with right products and services holds the key to success. Step 2 Marketing Strategy: At this stage, the ways to inform customers about the product and services available and ways to reach them are decided. The company decides the channel through which it will reach the prospective buyers. Some companies adopt an indirect channel including intermediaries and some adopt a direct approach. Step 3 Sales Force Design: At this step, the sales organization decides the structure of its sales force. It decides the roles of different sales person, number of sales persons to be devoted to a particular segment, the formal relationships between sales persons, appraisal and evaluation methods, compensation etc.

Figure 1.8: Formulation of Sales Organization Sikkim Manipal University Page No. 17

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Activity 2: Find out the sales management techniques Eureka Forbes Pvt. Ltd. is using in India. Which sales organization structure, company follows? Why? Source: www.eurekaforbes.com Self Assessment Questions 9. Formal communication is also called grapevine. (True/False) 10. Development of an effective sales organization depends upon the recognitions of informal communication & relationships. (True/False) 11. The span of control refers to the number of employees who report to the next higher level in the organization. (True/False) 12. Sales Force Design is a stage where we inform customers about the product and services available and ways to reach them are decided. (True/False)

1.7 Linking Sales and Distribution Management

Sales and distribution management constitutes one of the most important parts of marketing management. Sales management has been defined as the management of a firm's personal selling function while distribution is the management of the indirect selling effort i.e. selling through extra corporate organizations which form the distribution network of the firm. The sales management task thus includes analysis, planning, organising, directing and controlling of the company's sales effort. Distribution management comprises management of channel institutions as well as physical distribution functions. The importance of the sales and distribution function varies across organizations depending upon its nature and variety of products, target market, consumer density and dispersion, and the competitive practices among other things. For example, you may recall that in mail order companies (where the major exercise is distribution in response to orders received) virtually no personal selling effort is utilised. While, most organizations selling capital industrial equipment (say earth moving equipment, mainframe computers, CNC machine tools) do so through a team of their own sales engineers, involving little or no intermediary.

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Except for extreme instances of organizations which make exclusive use of either their own sales force or distribution channels, most organizations get the above functions performed through a combination of their own sales force and the distribution net work they choose to hire. A major decision in sales and distribution therefore becomes the judicious allocation of the above tasks between the sales force and channel members. The determinants of task allocations are: competitive practice, product and market requirements, (including market size, frequency of purchase and customer concentration) preference and buying practices of the target customers, and certainly the management philosophy towards control.

1.8 Interdependence of Sales and Distribution

After going through the above section you would have realised how interlinked distribution and sales management are. Apart from the important fact that in most organizations both sales management and the management of channels of distribution are the responsibility of the sales manager and should be viewed as jointly, contributing to the accomplishment of the marketing task, some other pointers towards the interdependence of these two vital functions are as under: All organizations use their own sales force or distribution network to reach out to their customers. The emerging practice is to use own sales force to sell to wholesalers/semi-wholesalers who in turn sell to retailers. Very few firms (unlike say Brooke Bond) use their own sales force to reach upto the retail level. As both the sales and distribution functions are simultaneously performed to accomplish the firm's sales objectives their dependence on each other for the effective attainment of overall marketing goals becomes obvious. In other words, activities of the sales organization would have to be coordinated with channel operations if sales goals haves to be effectively realised. The decision of the organization to allocate certain responsibility in the exchange process to its channel members would define the scope of responsibility of its own sales force and thereby would determine the type of personnel and training required. Even though, an organization may decide to deal directly with its wholesaler, semi-wholesaler, retailer or consumer, it is required to decide upon the type
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of help it will provide to the first and subsequent level of intermediaries. Since the requirements of each of the above types of first level contact entities are different from that of the other, the company's sales task would have to be defined in context of first level of contact chosen by it. The choice before an organization to have direct distribution, indirect distribution or a combination of the two is of strategic importance and depends upon factors such as the degree of control, flexibility, costs and financial requirements etc. Marketing through channels implies lower degree of control but would also mean lesser funds tied up in maintaining inventory and lower fixed and variable costs of managing the channels. Depending upon it own set of variables the organization would try and optimise the effectiveness of the exchange process through the use of some combination of the two. Necessarily then the scope of one (i.e. distribution) would define that of the other (sales management). Within the corporation, the sales organization is the initiator as well as the implementor of these dealer support operations. The effective functioning of dealer-sales organization relationship often becomes the key to successful working operations within the organization. This would mean that the sales management has the responsibility of structuring organizational relationship within their own department and with interacting organizational entities so that the sales task can be performed and coordinated with the overall marketing goals. Activity 3: Obtain the sales organization structure of any firm. Evaluate the design and structure of its sales force. Interview a sales manager of the company to determine how its markets and customers influence the design of its sales force. Self Assessment Questions 13. Sales management has been defined as the management of a firm's personal selling function while distribution is the management of the indirect selling effort. (True/False) 14. The sales organization is the initiator as well as the implementer of these dealer support operations. (True/False)

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1.9 Summary
The success of sales depends upon a good sales department headed by a competent, efficient and result oriented sales manager, who devotes his energies to fulfilling the targets with the help of other persons working in his department. It is highly dependent on team work but the responsibility lies with the sales manager. Sales management is generally referred to as the backbone of marketing. It is overall management of selling activities and it refers to only the specialised application of the process of management as a whole. The ultimate objective of sales management is to influence the consumers of the target market to get sales orders. The sales manager occupies a key position in a sales organization. All activities are based on his functions and responsibilities. Glossary Sales management: Sales management is concerned with the process off encouraging customers to exchange their funds for your services or goods. Monitoring: Assessing performance of self, other individuals, organizations to make improvements or take corrective action. or

Centralized organization: The responsibility and authority for decisions are concentrated at higher levels of management. Decentralized organization: Authority is delegated to lower levels of sales management. Formal organization: The formal organization is a fixed set of rules of intra organization procedure and structure that of the management.

1.10 Terminal Questions

1. Explain how negotiation skills act as a prerequisite for a sales manager. 2. Discuss the roles and responsibilities of a sales manager. 3. What factors should be kept in mind while developing a sales organization? 4. Compare and contrast the various types of sales organization structures. 5. What are the qualities of good sales personnel?
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1.11 Answers
Answers to Self Assessment Questions 1. Sales 2. Sales tracking 3. Salesman 4. Sales person 5. True 6. True 7. Re-engineering 8. Communication 9. False 10. True 11. True 12. False 13. True 14. True Answers to Terminal Questions 1. Refer to 1.4 How to reconcile differences 2. Refer to 1.4 Coordinator, controller 3. Refer to 1.6 Sales strategy, marketing strategy and sales force design 4. Refer to 1.6 Line and staff, formal and informal 5. Refer to 1.3 Ability to estimate customer's needs and desires

Mini-case
A large company which is producing wide range of health & personal care products is selling all over India. They are controlling the sales by having a geographical sales organization given below:

All the Regional Sales Managers are under the national sales manager who is controlling all the sales from the Centre. The weekly reports are being sent to the national manager which are compiled & analysed at the Centre.
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The regional manager has under them the area sales manager, the field sales supervisor and the sales representative in hierarchical order. The entire planning and co-ordination, sales training, territory development, sales promotion, after-sale service is all being taken care of at the Centre. The company is faced with the problem of coordination and proper recruitment and training of the salesmen. The company has two types of salesmen dealing in health care and personal care products. It is observed that keeping two types of salesmen is increasing the expenses but the volume of sales is satisfactory. The two types of salesmen from the same company are selling different products in the same territory and are calling upon the same customers. This practice leads to objection from some customers and there is wastage of time attending to both of them. Since all the planning, training and development is done centrally, some problems are being faced by the regional manager, as different types of salesmen are required by different regions who can understand and also be understood by the consumer. This is an important consideration for the promotional sales. Questions 1. Can you suggest an alternative organizational structure or modify the existing one? 2. How can you further help the organization for being more effective in sales?
Source: Dr. Matin Khan, Sales and Distribution Management, Excel Books.

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