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Chapter Thirteen

SALES AND
SALES MANAGEMENT

McGraw-Hill/Irwin Copyright © 2006 The McGraw-Hill Companies, Inc. All rights reserved.
THE KEY ROLES OF SALESPEOPLE

1. THE SELLING FUNCTION

2. MANAGE CUSTOMER RELATIONSHIPS

3. GATHER INFORMATION
• From Customers
• From Competitors
• About Market Forces

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 DETERMINING THE SALES STRATEGY
OPTION TO FIT YOUR CUSTOMER
1. SCRIPT-BASED SELLING—Used when all customers’
needs are similar

2. NEEDS SATISFACTION SELLING—Identifying buyers’

needs and selling to them

3. CONSULTATIVE SELLING—Bring specialized expertise

for a customized solution

4. STRATEGIC PARTNER SELLING—Seller-Customer

joint effort for developing product solutions

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 STAGES IN RELATIONSHIP BUILDLING
Commitment

• Secure
Expansion
complete
commitment
Exploration • Generate from both
reorders companies Dissolution
Awareness • Set correct • Upgrade • Manage
expectations • Full-line change
• Ensure proper sell
• Limited
initial use
relationships
• Follow up
• Failure to
• Make personal
monitor
visits
competitors
• Handle
or industry
complaints
• Complacency
• Achieve
customer
satisfaction
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 PARTNERSHIP COMMUNICATION:
FROM SINGLE LEVEL TO MULTI-LEVEL
Buying Company Before Partnering Selling Company
Production Engineering
Marketing Marketing
Purchasing Sales
Department Finance
Finance Purchasing Credit and
Salesperson
Accounting Agent
Billing
Shipping Shipping
& Receiving After Partnering & Receiving
Buying Company Selling Company
Production Engineering
Marketing Marketing
Purchasing Sales Purchasing
Finance Finance
Accounting Credit & Billing
Shipping Shipping
& Receiving & Receiving
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BUYING AND SELLING TEAMS STREAMLINE
MULTILEVEL SELLING

Buying Company Selling Company

Vice President Vice President
Of Purchasing Of Sales

Director of Account
Purchasing Manager

Product
Engineer
Specialist
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CUSTOMER FOCUSED TEAM STRUCTURE

Sales Specialists
Manufacturing
Account
Customer Manager
Support Team Account
Service CSS Leader Consultant Finance and
Rep. F&A Rep. Accounting
Customer Sales
Shipping
Manager Specialists
Prod. / Ind.
Shipping Other Mktg. Groups
Purchasing
Agent Rep.(s)

Purchasing Other Business

Units

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ALLOCATION GRID FOR SALES RESOURCES

Sales Potential
Low High
Relatively fewer Maintain sufficient
Strong resources should resources to continue
be allocated here to reap the sales
Market potential and strong
Position position

Assign to Direct more sales

alternative method resources here
Weak of communicating,
such as
telemarketing
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DO YOU OUTSOURCE THE SALES FORCE?

YES NO
• Establish relationships • Loss of control over
• Salary and selling sales presentation
expenses can • Products may not be a
be limited selling priority with
• Little/no up-front representative
investment

TO MAKE IT WORK:
INVEST IN TRAINING AND
MERCHANDISING MATERIALS

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 SALES FORCE CONTROL MECHANISMS
• ESTABLISH QUOTAS – Fair and Understandable
• Activity Quotas
• Performance Quotas
• ESTABLISH COMPENSATION PLAN – Equitable,
Stable, Understandable
• Straight Salary
• Straight Commission
• Combination Plans
• Bonus System

• MOTIVATION ACTIVITIES–
• Keep Sales Force Producing

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 MANAGER’S DILEMMA: EVALUATING
PERFORMANCE & MAINTAINING MOTIVATION

5 STEPS TO EVALUATE SALES FORCE PERFORMANCE

1. REVIEW SPECIFIC SALES OBJECTIVES
2. OBTAIN APPROPRIATE PERFORMANCE DATA
(outcomes and effort)
3. EVALUATE WHAT WAS BEYOND SALESPERSON’S
CONTROL
4. IDENTIFY PROBLEMS AND OPPORTUNITIES
5. CREATE A STRATEGY THAT RESOLVES
PROBLEMS AND SEIZES OPPORTUNITIES

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RECOGNIZING AND IDENTIFYING A PROBLEM
PROBLEM RECOGNITION
“The Problem”
Expectations Results
Enormity of problem rests on length of this difference

PROBLEM IDENTIFICATION
THE 6xWHY FILTER Ask the WHY question at least six times
(or as many times as necessary)
1. Our sales are down: WHY?
2. We can’t see customers: WHY?
3. We can’t make appointments on time : WHY?
4. We spend too much time covering territory : WHY?
5. Our territories are too big : WHY?
6. We don’t have enough salespeople : WHY?
CONCLUSION / PROBLEM
We haven’t matched demand to our sales force.
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