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DISTRIBUTION
MANAGEMENT
Session I
SALES MANAGEMENT:
ITS NATURE, REWARDS, AND
RESPONSIBILITIES
PLANNING
The conscious, systemic process of making
decisions about goals and activities that an
individual, group, work unit, or organization will
pursue in the future and the use of resources
needed to attain them.
STAFFING
Activities undertaken to attract, develop, and
maintain effective sales personnel within an
organization.
SALES TRAINING
The effort put forth by an employer to provide the
salesperson job-related culture, skills, knowledge,
and attitudes that result in improved performance
in the selling environment.
LEADING
The ability to influence other people toward
the attainment of objectives.
CONTROLLING
Monitoring sales personnels activities,
determining whether the organization is on target
toward its goals, and making corrections as
necessary.
SALES PERFORMANCE
10
11
In the table, Al Reid gives the steps necessary for getting success in
selling:
Territory Sales Managers Job Responsibilities
To yourself
Increase basic selling skills.
Develop management
abilities.
Keep pace with changes,
trends and developments in
your territory.
Study the latest products,
promotion policies and
procedures.
Be alert to new sales and
merchandising ideas.
To your company
Be proud of your association
with your company.
Maintain the company
standing and standards with
all customers.
To your customers
Work closely with decisiontakers and influencers in each
account.
Point out the advantages of
an association with your
company.
Be prompt in handling
records, reports,
correspondence, etc.
Organise presentations to
inform and save time.
Make the customers aware of
the changes in the companys
policies or procedures.
Stimulate and maintain
enthusiasm for your products.
Build and maintain goodwill.
Cont.
14
15
17
Prospecting
Prospecting is the process of identifying prospective buyers of the
product. A prospect is qualified if he has the authority, need, ability
and eligibility to buy. There are different ways to identify prospects.
Some of the most frequently used methods are described below:
Acquaintance References
Cold Calling
Centre of Influence Method
Personal Observation Method
Direct Mail or Telephone Method
Companys Records
Newspapers
Retailers
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Pre-approach
It emphasises that the salesman should know, after identifying the
prospect in the prospecting stage, the prospects likes and dislikes,
his needs, preferences, habits, nature, behaviour, economic and
social status etc.
Significance of Pre-Approach
1. Salesman concentrates only on the prospects and not the
suspects.
2. S/He is able to give a sales presentation more efficiently, effectively
and with confidence.
3. It does not waste the prospects time and energy since the
salesman is already aware of the needs and preferences of the
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prospect.
Approaching
In this stage the prospect and the salesman come in contact with
each other face to face.
The salesman has an opportunity to understand and interact with
the prospect in a better way.
Salesman should put forward his best efforts to make the best use
of this opportunity in getting the attention of the prospect and to
convince him to buy
the product.
Cont.
20
Cont.
21
Presentation
Quick presentation creates a good impression.
Attractively packaged, decorated and well-organised.
Should explain the product with its features and price
advantage to the customer in simple and easy terms.
Customer be shown the kind of quality that he is looking for.
Helps the salesman to prove the features of the product and
emphasise its genuineness.
Cont.
22
Demonstration
Demonstration is an exercise to prove the characteristics of the
product.
It highlights various attributes of the product such as utility,
performance, service and quality.
It is only during the demonstration that the customer gets an
opportunity to verify the facts about the product.
Demonstration is imperative and essential for a prospect to make
a buying decision.
Cont.
23
The Close
This is the last stage of any sales presentation.
The main aim of the close is to convince the prospect to sign the
order form or to place an order immediately rather than in the
future.
It is also important that through proper planning, prospecting,
presentation
capture the attention of the prospect and not let the prospect
change his mind.
24
Cont.
25
27
28
M a r k e t i n g P la n
S a le s F o r e c a s ts
S a le s F o r c e B u d g e t
29
30
F o r e ca s t
O b j ect i v e
D e t er m i n e D e p en d e n t a n d
I n d e p en d e n t V a r i a b l es
D e v el o p F o r eca s t
P r o ced u r e
S el ect F o r eca s t
A n a l y s i s M et h o d
E v a l u a t e R es u l t s
v er s u s F o r eca s t
M a k e a n d F in a liz e
F o r eca s t
T o t a l F o r eca s t
P r o ced u r e
P r es en t A s s u m p t i o n s
a b o u t D a ta
G a th er a n d A n a ly z e
D a ta
31
G e n e r a l E n v ir o n m e n t F o r e c a s t
I n d u s tr y S a le s F o r e c a s t
C o m p a n y S a le s P o t e n tia l
C o m p a n y S a le s F o r e c a s t
P r o d u c t L in e s
I n d iv i d u a l P r o d u c t s
fo r
Customers-Territories-RegionsDevisions-India-World
32
34
S u r v e y M e th o d s
E x e c u t iv e
O p in io n
U s e r s
E x p e c ta tio n
S a le s F o rc e
C o m p o s it e
M a th e m a tic a l M e th o d s
T est M ark et
B u ild - t o O rd er
N a iv e
M o v in g
A v erag e
R e g r e s s io n
T re n d
E x p o n e n tia l
S m o o t h in g
35
Executive Opinion
Sales Force Composite
Users Expectations
Build-to-Order
36
Executive Opinion
Executive forecasting is done in
two ways:
1. By one seasoned individual (usually
in a small company).
2. By a group of individuals, sometimes
called a jury of executive opinion.
37
Delphi Method
Administering a series of
questionnaires to panels of
experts.
Sales Force Composite
Obtaining the opinions of sales
personnel concerning future
sales.
38
Users Expectations
Consumer and industrial
companies often poll their
actual or potential customers.
Build-to-Order
Companies build final products only after
firm orders are placed.
39
MATHEMATICAL FORECASTING
METHODS
Test markets are a popular method of
measuring consumer acceptance of new
products.
40
Nave Method
This Years
Sales
Next Years Sales = This Years Sales X Last Years
Sales
41
Moving Average
Moving averages are used to
allow for marketplace factors
changing at different rates and at
different times.
Regression Analysis
Regression analysis is a statistical
method used to incorporate
independent factors that are thought
to influence sales into the forecasting
42
L i n e a r R e la t i o n s h i p
C u r v i li n e a r R e l a t i o n s h i p
S a le s
S a le s
P o p u la t i o n
(A )
P o p u la t i o n
(B )
43
H a v e Y o u D e v e lo p e d
a G ood
S a le s F o re c a s tin g
P ro c e s s?
M a rk e t D e c is io n S u p p o r t S y s te m
B re a k d o w n
U s e M u l t i p le
F o re c a s tin g
M e th o d s
B u i ld u p
F
O
R
E
C
A
S
T
14 0 %
13 0 %
12 0 %
110 %
90%
80%
70%
60%
44
FORCASTING
METHOD
TIME SPAN
MATHEMATICAL
SOPHISTICATION
COMPUTER
NEED
ACCURACY
Executive Opinion
Short to medium
Minimal
Not essential
Limited
Delphi Method
Medium to long
Minimal
Not essential
Short to medium
Minimal
Not essential
Users Expectations
Short to medium
Minimal
Not essential
Limited
Test Markets
Medium
Needed
Needed
Accurate
Nave Method
Present to medium
Minimal
Not essential
Limited
Moving Average
Short to long
Minimal
Helpful
Exponential Smoothing
Short to medium
Minimal
Helpful
Least Squares
Short to long
Needed
Desirable
Varies widely
Regression Analysis
Short to Medium
Needed
Essential
45
BUDGET
PURPOSES
Planning
Coordination
Control
46
4.
5.
6.
7.
8.
9.
10.
Special incentives
Office expenses
Product samples
Selling aids
Transportation expenses
Entertainment
Travel
47
48
if
S el ect B a s i c
C o n tr o l U n it
A n a lyz e
W o r k lo a d
D et er m i n e B a s i c
T er r i t o r i es
E v a l u a t e, R e v i s e
i f N eed ed
C u s t o m er
C o n t a ct P l a n
A ssign to
T er r i t o r i es
States
Counties
Cities and zip-code areas
Metropolitan statistical areas
Trading areas
Major/ Key accounts
A combination of two or more factors
Forecasted Sales
Average Sales per Salesperson
4. Tentatively establish
territories.
F i r s t C a ll
c
B ase
c
C lo v e rle a f P a tt e r n
W o rk B ac k
M a jo r- C ity P a tte r n
B ase
c
c
c
c
c
3
1
c
E ach L eaf O u t an d
B ack Sam e D ay
1 - D o w n to w n
WHAT IS A QUOTA?
A quota refers to an expected performance
objective.
Quotas are tactical in nature and thus derived
from the sales forces strategic objectives.
TYPES OF QUOTAS
Sales volume quotas.
Breakdown total sales volume.
Profit quotas.
Expense quotas.
Activity quotas.
Quota combinations.
Product lines.
Individual established and new products.
Geographic areas based on how the sales
organization is designed, which would
include:
Sales division.
Sales regions.
Sales districts.
Individual sales territories.
Activity quotas set objectives for jobrelated duties useful toward reaching
salespeoples performance targets.
PURPOSE: WHAT IS
PLANNED
WHO (USUALLY) IS
INVOLVED
1. Marketing
2. Regional plan
3. District plan
4. Territorial plan