Professional Documents
Culture Documents
Mechanism of control
◦ Composite of sales, expense & profit goal
◦ Yardstick to measure progress/ performance
◦ Identify weaknesses
◦ Revision or Correction
Form & Content
Statement of projected sales revenue &
selling expenses
Sales volume in units or currency
Details of sales volume
◦ Unit sales of each product
◦ Unit sales by sales territories
◦ Unit sales by quarter/ month
◦ Unit sales by class of accounts
Budgetary Procedure
Usual first stage is the sales budget in an
organizational budget
Once Sales budget is okayed
◦ Production gives budget for manufacturing
expenses and inventory
◦ Financial Dept. gives budget for Capex,
administrative expenses etc.
Production is more interested in Unit
sales projections & Finance in currency
sales figures
Planning Styles
Top Down
◦ Based on Theory X (No one like to work)
Bottom Up
◦ Based on Theory Y (People like to work &
take responsibility)
At least partial Bottom Up approach
should be used
◦ Participation at all levels enhances confidence
in budget and leads to higher sales
Competition Within
All managers in marketing/ sales present
their budgets
◦ Sales Manager
◦ Advertising Manager
◦ Market Research Manager
◦ Customer Service Manager
◦ Product Managers etc.
‘Sell’ your requirements to senior
Competition Outside
All divisions fight for funds from top
management
Top management is like a prospect
Sales executive gives presentation on
budget like a sales pitch
Focus should be on need/ wants (Profit)
of top management
Correlate requirements with profits
Budget for Control
Weekly or monthly progress report
prepared by Sales Manager
Shows sales & expenses for week to date,
month to date & year to date
Broken down sales figures are displayed
Variance of actual from budgeted is
analyzed
Correction or Revision undertaken
Not easy to change the budget
Conclusion
Sales budget is a statement of projected
sales revenue & selling expenses
Best prepared by Bottom Up approach
Regular comparison between budgeted
and actual paves way for Correction or
Revision
Sales Territories
Sales Territory is a group of customers &
prospects assigned to an individual sales
person
May be planned geographically
May be non geographical when
◦ Personal acquaintance selling is required
◦ Highly specialized salesperson
Reasons for having Sales Territories