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Authors: Tapan k.

Panda & Sunil Sahadev


Course: BBA

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 1: Introduction to Sales Management


Learning Objectives
1)
2)
3)
4)
5)
6)
7)
8)

Sales & Distribution Management


Evolution of Sales Management
Evolution of Personal Selling Strategies
Nature and Role of Sales Management
Types of Personal Selling
Types of Selling
Difference between Selling and Marketing
The Sales Management Process

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 1: Introduction to Sales Management


Sales & Distribution Management
As a Composite Function of Marketing, it has evolved into key area of
Marketing Expertise and Knowledge
It focuses on:
Development of Sound Sales and Distribution Strategy
Management of Marketing Channels
Sales Force Management of an Organization

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 1: Introduction to Sales Management


Sales & Distribution Management
Traditionally, marketers focused on Developing Methods and Practices to
enhance Sales Force Productivity and Efficiency focusing on Individuals
Performance
Now focus is on the Process (Formulating Strategies and Methods for
improving Selling Approach) involved in the Enhancement of Performance

Sales Force Downsizing


Application of Information Technology
Enhance use of Telemarketing
Key Account Management
The use of Independent Sales Organizations
Electronic Data Interchange
Cross Functional Team Selling

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 1: Introduction to Sales Management


Evolution of Sales Management
Marketings Early Development

Marketing was the natural outgrowth of Production Surpluses

Trading was the beginning of Modern Marketing System


After purchasing goods, Traders resold them in other Geographical
Locations
Traders were chiefly Responsible for the Physical Distribution of Goods

Town Economy: Medieval Economic Organizations in which commercial


activities were concentrated in the Local Population Centers

Agricultural Middleman: Early businessperson who purchased Staple


Products from the countryside and transported them to Local Market for
resale

Guild System (Association of Craftsmen): The Guild System provided


the background from which First Industrial Society emerged

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 1: Introduction to Sales Management


Evolution of Sales Management
Marketings Early Development
Bagman: Eighteenth Century Salesperson who sold Goods produced by the
Developing Factory System

Bagman emerged in Late Eighteenth Century during Englands


Industrial Revolution
Bagman are the first True Salespersons as they sold Goods for Firms in
which they did not have any Ownership
They are called Bagman as they sold their Goods from Sample Bags

Sometime after 1810, there developed Two Methods of Personal


Selling

Horse-Drawn Wagons called Wagon Peddlers


Retailing: Result of Strict Licensing requirements impose on
Peddlers

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 1: Introduction to Sales Management


Evolution of Sales Management
Marketings Early Development
Credit Investigators: Supplier Employed people who evaluated
Retailers Credit and developed Good Will.

Commercial Traveler : Credit Investigators later on started to sell


Merchandise to Retailer

Greeters: Supplier Employed Sales Reps who Solicited Business from


Retailers on buying Trips

Rural and Small Town Retailers both made annual Trips to Cities to buy
Merchandise
They shifted their base to Railroad Stations

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 1: Introduction to Sales Management


Evolution of Sales Management
Marketings Early Development
Drummers: 19th Century Salespeople who journeyed to merchants places
of business
Increase competition made Greeters to travel Outside the City
The term Greeter was replaced by Drummer
There are Two Views about the Term Drummer

They Drummed up Sales for Manufactures and Wholesalers which


they represented
The trunks which were used for carrying Samples, Personal Items
were shaped like Drums

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 1: Introduction to Sales Management


Evolution of Sales Management
Selling in 20th Century

From Production to Sales


At first, Selling was overshadowed by tremendous growth of
Manufacturing (Industrial Revolution)
Focus was on Production rather than Selling

Production Surpluses resulted in Re-emergence of Sales Era until WWII


Great Depression >> Aggressive Selling >> Need for Successful
Marketing
Creation and Rapid Growth of Corporate Departments designed to
Support Sales Effort e.g. Marketing Research

Postwar Era >> Modern Sales Era >> Professional Salespeople >>
Greater Emphasis on Educated Sales People and Extensive Sales Training

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 1: Introduction to Sales Management


Evolution of Sales Management
Selling in 20th Century

Traditional Sales Approaches

During the Modern Sales Era Traditional Sales Function called


Salesmanship Approach Emerged

Salespeoples behavior was considered the Key Ingredient in Sales


Process
Success or Failure of a Sales Call was depended on how the Salesman
handled a Prospect

There were Three Variations of Traditional Sales Approaches:


Canned Sales Presentation
Stimulus Response Theory
Selling Formulas

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 1: Introduction to Sales Management


Evolution of Sales Management
Selling in 20th Century

Traditional Sales Approaches

Canned Sales Presentation

A prepared, Structured Sales Script memorized by Salespeople


First used in Door to Door Selling and Now in Telemarketing
Company considers the Best Way to Sell
Major Weakness Prospect is treated as essentially Passive

Stimulus Response Theory


If the Salesperson Says or Does the Proper thing (Provides the Right
Stimulus) then Prospect will respond to the Stimulus by buying Good or
Service

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 1: Introduction to Sales Management


Evolution of Sales Management
Selling in 20th Century

Traditional Sales Approaches


Selling Formulas
Salespeople has to lead Prospects through various Steps in a
Persuasive manner

Arthur Fredrick Sheldon Selling Course


AIDR: Attention, Interest, Desire, Resolve are four progressive
Identifiable Stages before making Purchase Decision

AIDA: Attention, Interest, Desire, Action

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 1: Introduction to Sales Management


Evolution of Sales Management
Selling in 20th Century

Emergence of the Marketing Concept

During 1950s and 1960s, The Marketing Concept emerged as a Framework


for Business Philosophy of Customer Orientation

The formation of Technically Qualified Sales Support Departments aided in


Professionalization of Field Sales Force

Major Changes under Customer Orientation Philosophy are:


Problem Solving Role of Salesperson
Helping customers to buy rather than attempting to sell them
something
Building Long Term Relationships
Questioning and Need Analysis has replaced Sales Presentations

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 1: Introduction to Sales Management


Evolution of Personal Selling Strategies

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 1: Introduction to Sales Management


Evolution of Personal Selling Strategies
1. Persuasion: The peddlers carried their inventory and their goal was to
Persuade Buyers to buy goods at hand
2. Negotiation: As competition grew and buyers had a choice to opt for a
particular player:

It became requirement to Understand the Needs of Customers


Modification of Products, Prices and other Related Services

3. Consultative Selling (1970s): The sellers were required to identify New


Needs and Uses for the existing products:

Consultative Selling required Sellers to think like Buyers

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 1: Introduction to Sales Management


Evolution of Personal Selling Strategies
4. Business Management (1980s 1990s):
Emphasis was put on Management of Sales Territories and Accounts as
Profit Centers
Salespersons were expected to have Financial Knowledge
Training in Business Management and Practice of Business
Management Strategies

5. Partnership Strategies:
Linking of Information Systems of Buyers and Sellers to improve
Product Planning and Reducing Inventory

Information Sharing

Salespersons are trained on Data Processing, Data Warehousing &


Mining, Financial Analysis and Relationship Building Strategy

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 1: Introduction to Sales Management


Types of Personal Selling
1. Industrial Selling: It is basically termed as Business to Business Selling
and it is grouped into Four Categories based on Consumer Base:
1.

Selling to Resellers: Wholesalers or Retailers which buy Finished


Goods and resells them to End Users

2.

Selling to Business Users: This means Output of one Producer


enters the Production Process of another Producer to manufacture a
Final Good

3.

Institutional Selling: Institutional Customers use products in their


Daily Operations

4.

Products are used to Support Buyers Business rather than


Producing Buyers Products

Selling to Government: In most countries, Government is a Leading


Buyer

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 1: Introduction to Sales Management


Types of Personal Selling
2. Retail Selling: Retailing is defined as defined as all the Activities directly
related to Sales of Products and Services to Ultimate Consumer
In Retail Environment, a customer approaches the seller
3. Service Selling: Services are Activities or Benefits provided to a
consumers and Services are different from Products in 4 Areas:
1. Services are Intangible
2. Services are Produced, Sold and Consumed at the Same Time
3. Services cannot be Standardized
4. Services cannot be Stored or Inventoried

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 1: Introduction to Sales Management


Types of Selling
The diverse nature of Buying Situations demand a Diverse Pattern of Selling
Function and Selling Function varies according to nature of Selling Tasks:
1.Order Taker Salespeople
A. Inside Order Takers are the Sales Assistants and their role is just to
Complete the Transactions
B. Delivery Salespeople: Their job is to Deliver Products to the
consumers
C. Outside Order Takers visit the customers regularly and their
primary task is to Respond to Customer Calls rather than seek New
Customers
2.Order Creators
Missionary Salespeople are the sales staff who do not close a sale but
Persuade the customers to Promote a Sellers Brand Medical
Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad
Representatives

Chapter 1: Introduction to Sales Management


Types of Selling
1.Order Getters Salespeople: These are the salespeople whose objective
is to Persuade customers to make a Direct Purchase.
A. New Business Salespeople persuade New Buyers and Non Users
to buy companys Products & Services
B. Organization Salespeople are the Industrial Sellers who try to
establish and nurture long term relationships with Organizational
Buyers
C. Consumer Salespeople comprise of Door to Door Salespeople who
sell Products & Services for Individual Consumption
D. Technical Support Salespeople support Frontline Salespeople when
product is Technically Complex or needs negotiations demanding
Financial Attention
E. Merchandisers provide Sales Support in Retail and Wholesale
Selling. The give advice on Display, Execution of Sales Promotion
Prepared
By: Hamid Ali Raza
| Source:
Sales in
& Distribution
Management
by Tapanof
K. Panda
& Sunil Sahadev
| Preston University,
Programs
and
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Chapter 1: Introduction to Sales Management


Difference between Selling & Marketing
Selling
1.Emphasis on Product
2.Product First & then Decision to
sell it

3.Management is Sales Volume


Oriented

Marketing
1.Emphasis on Consumer Needs and
Wants
2.Understanding of Customer Needs
& then a Product or Service to
satisfy these Needs
3.Management is Profit Oriented

4.Planning is Short Term todays


Products & Markets

4.Planning is Long Term New


Products, Tomorrow's Markets &
Future Growth

5.Stresses needs of Seller

5.Stressed Needs of Buyer

6.Views business as Goods


Producing Process

6.View business as Consumer


Satisfying Process

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 1: Introduction to Sales Management


Difference between Selling & Marketing
Selling
7.Emphasizes on staying with
existing Technology and Reducing
Costs
8.Different departments work
separately
9.Cost determines price

Marketing
7.Emphasizes on Innovation
8.All departments work in Integrated
manner
9.Consumer determines price, price
determines cost
10.Marketing views customers as
the very beginning of a Business

10.Selling views customers as last


link in Business

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 1: Introduction to Sales Management


The Sales Management Process
Sales Management is the process of attaining Sales Force Goals in Effective
and Efficient Manner through Planning, Staffing, Training, Leading and
Controlling Organizational Resources. Sales Management Process covers
Three Interrelated Steps:
1.Formulation of a Strategic Sales Management Programme
Evaluating Environmental Issues Effecting Organization (SWOT, PEST, Core
Competencies)
Organizing and Planning Over All Personal Selling Efforts
Integrating Over All Personal Selling Strategy with other Elements of
Marketing Strategy
2.Implementation of Strategic Sales Management Programme
Selecting, Training, Leading and Motivating appropriate Sales Personnel
Designing & Implementing Policies and Procedures to direct Efforts of
Salespeople
toAliachieve
Corporate
Objectives
Prepared By: Hamid
Raza | Source: desired
Sales & Distribution
Management by Tapan
K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 1: Introduction to Sales Management


The Sales Management Process
Sales Management is the process of attaining Sales Force Goals in Effective
and Efficient Manner through Planning, Staffing, Training, Leading and
Controlling Organizational Resources. Sales Management Process covers
Three Interrelated Steps:
3.Evaluation and Control of Sales Force Performance
Developing Methods and Practices for Monitoring & Evaluating Individual &
Group Sales Force Performance
Taking Corrective Steps either in Formulation or Implementation
Programmes to achieve Corporate Goals

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 2: Selling Skills & Selling Strategies


Learning Objectives

Selling & Buying Styles


Sales Task & Function
Communication Skills
Listening Skills
Conflict Management & Resolution Skills

Negotiation Skills
Problem Solving Skills

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 2: Selling Skills & Selling Strategies


Buying Styles

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 2: Selling Skills & Selling Strategies


Selling Styles

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 2: Selling Skills & Selling Strategies


Sales Task & Function
A salesman has to undertake various Tasks/ Functions during the Process of
Selling. Different Sales Tasks/ Functions from Selling Point of View are:
1.Communication Function: When a salesperson gives Sales Presentation or
makes a Sales Call
2.Listening Function: A Customer may have Queries, Doubts and
Apprehensions and wishes the salesperson give him Patient Hearing, thus,
Salesperson must perform Listening Function
3.Information Function: Providing Information about Existing Products of the
company and New Products that are likely top come in market
4.Negotiation and Bargaining Function: Salesperson has to Negotiate and
Bargain for the benefit of the Organization (usually in Non Standardized
Markets)
5.Problem Solving Function: In case of Solution Selling a Customer has a
problem and he expects the salesperson to solve his problem
Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 2: Selling Skills & Selling Strategies


Types of Selling Situations
According to different Marketing and Situational Factors; Types of Selling are:
1.Maintenance Selling
The art of Servicing the Existing Accounts, Securing Promotional
Cooperation, Counting Inventory & Taking Replenishment Orders
There is no need of Prospecting as this kind of selling is done with Existing
Customers
2.Developmental Selling
The art of Contacting Potential Customers and Building Business for the
Firm
Salespeople engaged in Developmental Selling are called Business
Development Sales Executives
These sales people take the prospect through the complete Selling Process
fromPrepared
Prospecting
to| Source:
Closing
a Sale.
By: Hamid Ali Raza
Sales & Distribution
Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 2: Selling Skills & Selling Strategies


Selling Skills

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 2: Selling Skills & Selling Strategies


Communication Skills
The ability and expertise to communicate is necessary in Selling Function
Salespeople should possess Good Vocabulary and should be able to express
themselves Intelligently
A salesperson ability to perceive Verbal & Non Verbal Clues help in
answering Objections and finding about the Purchase Intention
A good Voice Quality improves the Personality of the Salesperson and
contributes to the success
Effective Communication Skills contribute in Nurturing Long Term
Relationships with customer based on Mutual Trust through:
Truth of Words
Intent and Empathy
Communication Skills are important for Persuading Customers

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 2: Selling Skills & Selling Strategies


Communication Process
Communication Process is defined as a Set of Activities & Systems Integrated
for an Exchange of Ideas, Concepts, Information and Knowledge between a
Sender and a Receiver through Alternative Channels e.g. Sales Presentations,
Sales Literature & TVCs are the examples of Sales Communication
A Typical Communication Process has the following Components:
Source/ Sender: (Salesman who provides information about Product or
Service)
Source has Ideas, Concepts, Information & Knowledge to be
communicated to Audience
Ideas, Concepts, Information & Knowledge have to be encoded in
presentable form
E.g. Print Ads, TVCs, News Releases etc.
Receiver: (Customer)
Receiver is the one for who the communication is directed at
Receiver Provides the Feedback
Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 2: Selling Skills & Selling Strategies


Communication Process
Communication Process is defined as a Set of Activities & Systems Integrated
for an Exchange of Ideas, Concepts, Information and Knowledge between a
Sender and a Receiver through Alternative Channels e.g. Sales Presentations,
Sales Literature TVCs are the examples of Sales Communication
A Typical Communication Process has the following Components:
Channel/ Medium:
Tools or Systems used to transmit Message (Ideas, Concepts,
Information, Knowledge)
E.g. Electronic and Print Media, Internet
Feedback:
Receiver assesses the Effectiveness & Response of the
Communication through Feedback
E.g. Interest in Product, Purchase Decisions, Rejecting any Sales
Offer
Noise: Any element which affects the Transmission or Effectiveness of
Reception of Message
Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 2: Selling Skills & Selling Strategies


Communication Process

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 2: Selling Skills & Selling Strategies


Types of Sales Communication
There are Two Types of Sales Communication
1.Non Personal Communication
It includes the use of Mass Media for providing Product Information
Mass Media includes Newspapers, Television, Internet
The effectiveness of Non Personal Communication is Limited:
Scope of Recipients is not known
Ability to persuade customers is less
Effective in disseminating Product Information to Enhance the Level of
Awareness
2.Personal Communication
Effectiveness of this Medium is High
It takes Customers to High Level of Buying Decision Process
Customers are provided on the Spot Solutions/ Response to their
Problems and Objections
Prepared
Hamid Ali Raza
| Source:
& Distribution Management
by Tapan K. Panda & Sunil
Sahadevof
| Preston
University, Islamabad
By:
Results
can
beSales
evaluated
with Conversion
Rate
Prospects
into

Chapter 2: Selling Skills & Selling Strategies


Forms of Communication
There are Two Forms of Communication
1.Non Verbal Communication
It includes Information which is not in Oral &Written Forms
It is the most Basic Form of Communication and includes:
Facial Expressions, Gestures, Spatial Relationships, Attitude towards
Time & People, Dress Code, Voice Intonations, Expression of
Emotions like Laughter, Surprise etc.
Non Verbal Communication is Less Structured and More Difficult to Study/
Understand
2.Verbal Communication
Verbal Communication consists of Words arranged in Meaningful Pattern
It can be Oral or Written
Salespeople prefer Oral Communication over Written Channels
By: Hamid
Ali Raza | Source: Sales & Distribution
Management
by Tapan K. Panda
& Sunil Sahadev
Preston University, Islamabad
Its Prepared
ability
to communicate
Senders
Intended
Message
is| Limited

Chapter 2: Selling Skills & Selling Strategies


Managing Body Language
The Non Verbal Cues taken together are called Body Language. Salespeople
should manage Body Language to show that they are Confident to Handle
Sales Situation
1.Personal Appearance
Personal Appearance includes elements such as Dress, Hair Style,
Accessories and Over All Grooming
First Impact of any Potential Buyer is created by Personal Appearance of
Salesperson; even before he speaks
Salespeople should be careful about their Personal Appearance as it may
put Audience in a Hostile, Friendly or Agreeable Position

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 2: Selling Skills & Selling Strategies


Managing Body Language
The Non Verbal Cues taken together are called Body Language. Salespeople
should manage Body Language to show that they are Confident to Handle
Sales Situation
2.Posture
Postures refers to the way one Stands, Sits, Walks and it also includes the
Mobility of Hands, Legs and other Parts of the Body
Postures are indicators of whether a person is Vibrant, Nervous, Jittery,
Confident or Self Assured
A salesperson should cultivate his Posture to create Positive Impact:
Stand Tall, Feet Together and Weight on Instep and Chin should be
parallel to Floor
Sitting Straight
Learn where to keep Hands and How to shift Weight of the Body
Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 2: Selling Skills & Selling Strategies


Managing Body Language
The Non Verbal Cues taken together are called Body Language. Salespeople
should manage Body Language to show that they are Confident to Handle
Sales Situation
3.Gesture
Gestures include movement of thehands,face, or other parts of thebody
Gestures enhance the Impact of what is being said
Gesture may or may not accompany Oral Delivery
Practice in front of Mirror how to use different kind of Gestures to improve
ones Communication Skills

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 2: Selling Skills & Selling Strategies


Managing Body Language
The Non Verbal Cues taken together are called Body Language. Salespeople
should manage Body Language to show that they are Confident to Handle
Sales Situation
4.Facial Expressions
Face is the most Expressive Part of the Body and can add meaning to Verbal
Communication
A Smile is a Symbol of Friendliness
A Frown is a Symbol of Discontent
Raising Eyebrows as an Expression of Disbelief
Negative Facial Expressions can decrease the Effectiveness of a Sales
Presentations
Negative Facial Expressions include:
Deadwood Expression
Biting Lips
Raising Eyebrows
Blinking Eyes too much

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 2: Selling Skills & Selling Strategies


Managing Body Language
The Non Verbal Cues taken together are called Body Language. Salespeople
should manage Body Language to show that they are Confident to Handle
Sales Situation
5.Eye Contact
Eye Contact is an Automatic Process of Obtaining Feedback
Eye Contact enables Salesperson to Alter, Adjust, and Reframe his Sales
Message
Eye Contact should be maintained as it Expresses Sincerity of Salesperson
and Attentiveness of Customer

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 2: Selling Skills & Selling Strategies


Managing Body Language
The Non Verbal Cues taken together are called Body Language. Salespeople
should manage Body Language to show that they are Confident to Handle
Sales Situation
5.Space Distancing
Salespersons does not allow to invade Personal Space until the relationship
is very Friendly or if there is Prior Relationship
Social Distance (A Zone of 4 12 Feet) is maintained for Formal
Presentation
Social Distance also includes the Standing/ Seating Position

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 2: Selling Skills & Selling Strategies


Noise/ Barriers to Communication
Any element which affects the Transmission or Effectiveness of Reception of
Message will be categorized as Noise
1.Physical Noise
Noise Emanating from Telephones or Computers or any other Physical
Objects
2.Psychological Noise
It includes Fantasies, Daydreams and Mental Blocks due to Culture, Religion
etc.
3.Factual Noise
It results from Factual Distractions which may be due preoccupation with
factors which deter the reception of real message

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 2: Selling Skills & Selling Strategies


Noise/ Barriers to Communication
Any element which affects the Transmission or Effectiveness of Reception of
Message will be categorized as Noise
4.Semantic Noise
It occurs when one Over Reacts to an Emotional Statement
5.Self Focus
A Level of Preoccupation with thoughts about oneself
6.Self Defensiveness
It results when people are threatened about their positions due to Negative
Feedback
People tend to make arguments and Ignore the Communication by being
Self Defensive
Due to Self Focus the Attention Level becomes Low
Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 2: Selling Skills & Selling Strategies


Noise/ Barriers to Communication
Any element which affects the Transmission or Effectiveness of Reception of
Message will be categorized as Noise
7.Experiential Superiority
It is found in people who have gone through Varied Experiences
8.Egocentrism
It is the tendency to view oneself as the center of everything
9.Selective Perception
When Receiver is not in Same Frame of Mind as that of Sender due Poor
Level of Comprehension or High Level of Distortion
Selective Attention also means that people will pay more Attention to
Information which is of Value of them in the Present Situation rather than
which has Long Term Relevance
Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 2: Selling Skills & Selling Strategies


Listening Skills
Listening is an Active Search of Meaning in the Message Received
A good listener welcomes New Ideas, stays Informed, Up to Date and Out of
Danger
Effective Listening needs Conscious Effort and Willing Mind
Effective Listening supports Effective Relationships and Enhance Efficiency
of Salesperson

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 2: Selling Skills & Selling Strategies


Types of Listening
There are Three types of Listening. These types differ on the Basis of Purpose
of Listening or in the Degree of Feedback or Interaction is required
1.Content Listening
The objective of Content Listening is to Understand and Retain the
Speakers Message
Feedback is not involved as it is only the reception of Message
2.Critical Listening
The objective of Critical Listening is to Understand and Evaluate the
Meaning of the Speakers Message at Several Levels

Logical Level of Argument


Strength of Evidence
Validity of Conclusions
Implications of Message
Speakers Intention and Motives

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 2: Selling Skills & Selling Strategies


Types of Listening
3.Active/ Empathetic Listening
The objective of Empathetic Listening is understand Speakers Feelings,
Needs and Demands
The purpose is to appreciate Listeners Perspective whether we Like it or
not
By Listening in Empathetic way; the Listener allows the Speaker to vent his
Emotions

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 4: Managing Sales Information


Learning Objectives

Market/ Sales Forecast and Market Demand


Marketing Decision Support System
Importance of Sales Forecasting
The Forecasting Process
Approaches to Forecasting
Sales Forecasting Methods

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 4: Managing Sales Information


Market/ Sales Forecast and Market Demand
Market/ Sales Forecast: It is the estimated Rupee or Unit Sales for a
Specific Future Time Period based on Companys Marketing Plan and an
Assumed Market Environment
It depends on:

Industry Sales
The Market Share of the Firm
The Growth Rate in the Category
The Performance of Product Line and Individual Products Market

Market Demand: It is the Sum Total of All Individual Demand for a Product
or Service
It depends on:
Consumer Preferences (Advertising, Innovation, Changes on Customs
&Traditions)
Income Levels of Consumers
Price
of By:
other
Prepared
Hamid AliGoods
Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 4: Managing Sales Information


Marketing Decision Support System (MDSS)
MDSS is an Ongoing, Future Oriented Information Structure designed to
Collect, Collate, Categorize, Edit, Store and Retrieve Information to Aid
Decision Making in an Organizations Sales & Marketing Programs
It involves Problem Solving Technology consisting of People, Knowledge,
Software & Hardware

It collects Data from Transaction System & Analytical System and provide
Analysis for Decision Making

A Valuable MDSS provides Fast, Less Expensive and more Complete


Information for Sales Management Decision Making

Senior Management can Continually Monitor Sales, Markets, Performance of


Sales People and Other Marketing Systems in details

MDSS is Key for Accurate Sales Forecasting

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 4: Managing Sales Information


Importance of Sales Forecasting:
Success of Business depends on Sales Forecasting because:
Supply Chain Management & Value Chain Management depends on
Demand Patterns of Product

Procurements can be Channelized as per Demand

Inventory Level during Production and Final Output Inventory can be


Regulated and Modified depending on the Sales Patterns

It forms the Basis for developing Production Schedules

It helps managers to decide Sales Quotas to different Segments, Zones &


Individual Salesmen

It forms the Basis for Developing Sales Budgets

An Integration of all these Variables help in Developing Marketing Plan,


Growth Strategies & Marketing Offer

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 4: Managing Sales Information


Sales Forecasting Process
It is defined as Series of Decisions & Actions in Identifying the Sales
Forecasting Objectives, Determining the Independent & Dependent Variables,
Developing a Forecasting Procedure and using the Available Data in the
Selected Method to Estimate Future Sales
Supply Chain Management & Value Chain Management depends on
Demand Patterns of Product

Sales Forecasting Objectives: Rupee Sales, Unit Sales or Number of


Salespeople Hired

Dependent Variables are the Variables which are Forecasted (Rupee


Sales, Unit Sales or Salespeople Hired)

Independent Variables are the Market Factors which influence


Dependent Variables (Quantitative)

Forecasting Methods & Methods: Quantitative or Qualitative

Sales Forecast is finalized


and
itSahadev
is Evaluated
and
Modifications are made
by Tapan K. Panda
& Sunil
| Preston University,
Islamabad

Chapter 4: Managing Sales Information


Approaches to Sales Forecasting
There are Two Approached to Sales Forecasting:
1.Break Down Approach
General Environment Forecast: It is the Study of Factors of Internal &
External Environments that influence to a Significant Levels (Pricing, Product
Changes, Distribution, Promotion, Financial Resources, Management Skills,
Technology, Economy etc.)
Industry Forecast/ Market Potential: The Sum Total of All Individual Demand
for a Product or Service or the entire Industry
Company Sales Forecast: The maximum Estimated or the Potential Sales
that company may reach in a defined Time Period under given conditions
(Percentage of Industry Sales)
Sales Forecast for the Product Lines
Individual Product Sales Forecast
by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 4: Managing Sales Information


Approaches to Sales Forecasting
There are Two Approached to Sales Forecasting:
1.Build Up Approach
It is the Reverse of the Break Down Approach
Strategic Units or Unit Heads make Individual Forecasts
Individual Forecasts are combined to make Broader Forecast of the Firm
Difficult Method when Firm has Large Product Offerings and Serving Multiple
Markets

by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 4: Managing Sales Information


Sales Forecasting Methods
Based on the Type of Input Data; there are Two Types of Sales Forecasting
Methods:
1. Qualitative Methods: These methods are based on Judgments either of
Experts or a Collective Judgments of Knowledgeable People of Industry:
A.Experts Opinion Method: Experts in the Specific Area are asked for their
Forecast Estimates:
Marketing Professionals
Distributors/ Dealers
Industry Associations
Marketing Consultants
It can be in the form of Individual or Group Forecast
Group Approach has Two Methods:
Key Executives submit Independent Estimates without discussion and
Individual Estimates are Averaged into One Estimate
Group discussesby Tapan
and
presents
separate
estimates,
differences are
K. Panda
& Sunil Sahadev
| Preston University,
Islamabad

Chapter 4: Managing Sales Information


Sales Forecasting Methods
1. Qualitative Methods
B.The Delphi Method: This is an improvement on Expert Opinion Method:
Group of Experts and Delphi Coordinator are selected
Experts give their Written Responses to Coordinator
Coordinator processes, complies and refers them back to Panel Members for
Revision this process continues for several Rounds (Usually Three Rounds)
Process stops when a consensus is reached
Only Coordinator will know all the Members of the Team and only he will
have access to all Responses and he runs Statistical Analysis
The process aims at Gradual Reduction of Variability
This method is widely used for Sales Forecasting regardless of Company
by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad
Size

Chapter 4: Managing Sales Information


Sales Forecasting Methods
1. Qualitative Methods
C.Sales Force Composite: This method is based on the fact that individuals
with Direct Contact with Customers will be better informed
Organizations Salespersons come up with their Forecasts
Individual Forecasts are summed up to get a Overall Demand Forecast for
the product
Results can be affected by the:
Staff Biases
Lack of Interest in the Process
Ignorance about wider Economic Changes and Trends

by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 4: Managing Sales Information


Sales Forecasting Methods
1. Qualitative Methods
D.Survey of Buyers Expectations: This method is based on Survey of
Buying Intentions and Market Tests
The Survey of Buying Intentions involves the selection of a Sample of
Potential Buyers and getting information on their likely purchase of Product in
Future
Forecast based solely on this method tend to be overly Optimistic; as a
positive response in survey may not result in Purchase in Future

by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 4: Managing Sales Information


Sales Forecasting Methods
1. Qualitative Methods
D.Historical Analogy Method: This method is used for Forecasting the
demand for a Product or Service for which there is no Past Data
Marketing Personal may use Historical Analogy between Two Similar
Products and derive Demand for New Product using Historical Data

by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 5: Sales Organization


Learning Objectives
Sales Organization
Objectives/ Advantages of Sales Organization
Factors Influencing Structure
Organizational Principles
Span of Control
Centralization and Decentralization
Integration and Coordination
Organizational Design
Line Design
Organizational Design by Territory
Organizational Design by Management Function
Organizational Design by Product
Organizational Design by Customer
Combined Organizational Design
Key Account Sales
Emerging Organizational Designs
Agency & Distribution Selling
Shared Sales Force
Telemarketing
Number of Sales People

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 5: Sales Organization


Sales Organization
Definition: A Sales Organization is an organization of Individuals either
working together for the marketing of Products & Services manufactured by
an enterprise or for Products that are procured by the firm for the purpose of
Reselling.

Objectives/ Advantages of Sales Organization


Sales

Organization helps to achieve coordination among the activities of


individuals
Sales

Organization defines the duties, roles, rights and responsibilities of


Salespeople
A

proper Sales Organization helps in the flow of both upward and downward
communication for taking Sales Related Decisions
A

proper Sales Organization also removes Duplication of Efforts

Sales

Organization helps in achieving Effectiveness and Efficiency


Prepared By:
Hamid Ali Raza | Source:
Sales &Targets
Distribution Management
by Tapan K. Panda Costs
& Sunil Sahadev | Preston University, Islamabad
achieving
maximum
Sales
with minimum

Chapter 5: Sales Organization


Objectives/ Advantages of Sales Organization
A

Sales Organization serves as the unified Contact or Relationship Point with


Customers
Sales

Organization contributes to building the morale of Salespeople as they


become clear about his position, role and responsibilities

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 5: Sales Organization


Factors Influencing Sales Organizational Structure
1. Product & Service Related Factors
In

case of FMCGs (soaps, oils, toothpaste) the Size of the Organization is


Large as a large customer base is to be served
Organization

will be Complex and Large in Size when both Product Mix and
Quantity in each Sale Category is Large

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 5: Sales Organization


Factors Influencing Sales Organizational Structure
2. Organization Related Factors
If

the Size of Enterprise is Small then it will have limited number of Products
and Customers and a Simple Structure is required and Vice Versa
Organizations

having Specialized Products and Serving Niche will have Small


and Simple Sales Organization
An

organization with Limited Financial Resources will prefer to engage


intermediaries for distribution and keeps Sales Organization Simple and Vice
Versa
If

organization follows a Centralized Policy for Sales Related Decisions then


Sales Organization will be simple and Vice Versa

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 5: Sales Organization


Factors Influencing Sales Organizational Structure
3. Marketing Mix Related Factors
Size

of the Market also determines the Structure and Size of Sales


Organization
Global, International, National Market >>> Large Sales Organization
Organizations

which have Selective Distribution Strategy as compared to


Organizations with Intensive Distribution Strategy will have Simple Sales
Organization
Price

Policy also influences the Size and Structure of Sales Organization


Low Price Products with High Demand and Large Customer Base >>>
Large Sales Organization

4. External Factors
The

Customs and Traditions used in the past to cater the market influence
the Size and Structure of the Sales Organization
Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 5: Sales Organization


Organizational Principles
1. Span of Control
Span

of Control refers to number of Subordinates and Sales Staff under the


Supervision of one Sales Manager
Narrow

Span of Control: Less or Limited Number of Sales Staff under the


Supervision of one Sales Manager
Appropriate Model when there are New Recruits to be handled in the
field
New Recruits learn from Experienced Managers when it is One to One
Coaching
It has following disadvantages:
Complicated Communication Flow
Demotivation due to Direct Supervision
Resistance by Innovative New Recruits to Traditional Methods of
Coaching
Isolation of Management from Grassroots Levels
Higher Operations Costs

Wide

Span of Control: Large Number of Sales Staff under the Supervision


of one
Sales
Manager
Prepared
By: Hamid
Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 5: Sales Organization


Organizational Principles
2. Centralization and Decentralization
The

extent of Control and Authority of the Top Management versus the Field
Sales Manager over the Sales Force decides the Level of Centralization in an
organization
Centralized

Organization: In Centralized Organizations; Top Management

decides:
Recruitment, Selection, Training, Supervisions, Fixation of Quotas,
Territory Allocations and Compensation Plans
Consistency in Marketing Plans, Uniformity in Products & Services and
Coordination & Integration of Sales People are the Advantages of
Centralization
Helps in saving Recruitment, Selection, Training and Motivational Plan
Costs

Decentralized

Organization: Field Managers take all the decisions

It helps Organizations to be more Competitive and Responsive at


respective Market Levels

to action
results
Motivated
Prepared By:Greater
Hamid Ali Raza Freedom
| Source: Sales & Distribution
Management
by Tapanin
K. Panda
& Sunil Sahadev and
| PrestonProductive
University, Islamabad

Chapter 5: Sales Organization


Organizational Principles
3. Integration and Coordination
Integration

and Coordination relates to Flow and Use of Communication and


Marketing Intelligence
Traditional

(Butter Fly) Approach: All information flows through the


Sales Organization or Sales is the only Upfront Department
Modern

(Bow Tie) Approach: Organization across all departments is


integrated to serve customers
Sales

Department provided information to:

Research & Development for New Product Development


Sales and Marketing Departments interact for deciding Advertising

Policy, Sales Promotion, Cooperative Advertising with Intermediaries


Sales Department also provides about Financial Arrangements, Credit
Policy, Credit Collection
Coordinates information on Compensation and Dealer Motivation Plans

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 5: Sales Organization


Organizational Design
Organizational Design refers to:
Formal

and Coordinated task of assigning Territories

Establishing

of Flows of Communication

Establishing

Responsibilities of Sales Groups and Individuals

Organizations

adopt different kinds of Structures e.g.

Line Organization
Organization Design by Territory
Organization Design by Management Function
Organization Design by Product
Combined Organization Design

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 5: Sales Organization


Organizational Design
Line Organization
Small

Firms have Line Organization

Chief

Executive does the Decision Making and Decisions flow down the Line
for execution
Chief

Executive has all the Authority over Sales Function

Advantages
Decisions

are made Faster, Overhead Costs are Low and Salespeople need
to follow command
Disadvantages
Salespeople

do not have time for Sales Planning and are busy in achieving
Targets set at the Top

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 5: Sales Organization


Organizational Design
Organizational Design by Territory
Organization

is designed on the basis of Geographic Territory

Several

Areas are combined together as Territory for assigning a Supervisor


and several Territories are combined to assign a Sales Manager
Advantages
Travel

Times are Limited and Sales Force remains close to the customers

Quality

of Customer Service is Better as Number of Customers is Limited


and Geographically Concentrated
Conflict

is minimum as customers are identified in each area

Demand

for New Products can be identified

Product

Modifications, Marketing Strategies, Sales Recruitment can be


adjusted to specific requirements of Level of Competition, Area, Job and
Demand

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 5: Sales Organization


Organizational Design
Organizational Design by Territory
Disadvantages
Salespeople have to sell entire Product Line in a Specific Area to all Types of
Customers

Salespeople

spend too much time on Products which are easier to sell but
may not be Profitable or provide High Growth Potential
Coordination

is difficult over Territories

There

is High Probability of Conflict in Resource Allocation

These

problems can be solved through:

Close Supervision
Proper Incentive Structure
Hiring Better Sales Talent
Professional Training and Technical Support

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 5: Sales Organization


Organizational Design
Organizational Design by Management Function
It

is the Grouping of Sales Task according to their characteristics

Firms

need Special Expertise for which Selling Activities are divided into
Functions to be performed
Sales Planning
Recruitment & Training of Salespeople
Supervision of Sales Personnel
Advertising Function
Sales Promotion
Sales Analysis & Marketing Research
Advantages
Special

Expertise and Support makes organization profitable

Specialization
Response

is achieved at different Levels of Hierarchy

to and Decision Making on Sales related problems is faster

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 5: Sales Organization


Organizational Design
Organizational Design by Management Function
Disadvantages
Dependence

on each other on Delivery of Final Customer Service

Integration

is achieved at Higher Level which makes the job of Higher


Authority Complex
Interdepartmental

rivalry and Non Cooperation issues arise

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 5: Sales Organization


Organizational Design
Organizational Design by Product
Organizations

with Diversified Product Portfolios prefer Design on the basis


of the Type of Products
Product

Specialization is necessary when products are Technical and


Complex but completely different from each other
Advantages
Close

attention to each Product in Product Portfolio

Salespeople
The

can master all the relevant Product Information

interference from other departments is minimum

Satisfaction

of Customer is highest as customer receives maximum

attention

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 5: Sales Organization


Organizational Design
Organizational Design by Product
Disadvantages
Coordination

of Sales function is difficult across different product categories

There

can be Duplication of Effort when Salespeople from the same


organization call same customers; it increases cost of selling
Operational

Cost is high because of Large Number of Employees

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 5: Sales Organization


Organizational Design
Organizational Design by Customer
Organizations

with several and distinct markets are designed on the of


Customer Profiles
These

designs are based on Customer Profitability Analysis and Varied


Service Delivery
Each

Salesperson sells entire Product Line to the same customer

Advantages
This

design is Customer Driven and Salespeople gain more Knowledge on


Customer Requirements and become experts
This

design helps in building Successful Customer Relationships

Sales

and Marketing Planning developed depending customer requirements


and behavior
Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 5: Sales Organization


Organizational Design
Organizational Design by Customer
Disadvantages

This design is expensive to maintain

There is fear of Duplication of Effort as controlling and coordinating


activities are difficult in large firms

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 5: Sales Organization


Organizational Design
Combined Organizational Design
Many organizations that are Large in Size and Complex in Product Offering
prefer complex design

This design can be a combination of Product, Function, Geography or the


customer depending on the Market Coverage and Scope of Business

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 6: Management of Sales Territory


Learning Objectives
Sales Territory
Designing a Sales Territory

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 6: Management of Sales Territory


Sales Territory
Definition: A Sales Territory is a Group of Present and
Potential Customers assigned to an individual salesperson, a
group of salesperson, a branch, a dealer, a distributor or a
marketing organization at a given period of time.
Advantages of Sales Territory
It ensures better Market Coverage, Effective Utilization of Sales
Force and Efficient distribution of Workload among Salespeople
It enables Sales Managers to Evaluate the Performance of
Salespeople, Control over Direct and Indirect Costs of Sales Function
and Optimum Utilization of Sales Time by Sales People
Restricting Sales Force to Specific Geographic Areas helps in
generating more Sales from the same area
Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 6: Management of Sales Territory


Sales Territory
Advantages of Sales Territory
Sales Territory ensures that Salespeople do not encroach on each
others Territory
Restricting Sales Force to Specific Area helps salespeople to
understand the Current and Latent Needs of Customers and to serve
them better
Disadvantages of Sales Territory
A Sales Territory may not help a New Established Organization or
where Sales are made through Personal Relationships
Sales Territory may also not suitable for organizations which are
selling Highly Sophisticated and Technically Complex Products
Organizations which have customer base distributed over a vast
Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 6: Management of Sales Territory


Designing Sales Territory
Various Factors are considered while Designing a Sales Territory
Size of Organization
Level of Competition in each Product Category
Number and Quality Level of Products in Portfolio
Type and Quality of Services and Customer Support to be provided
Quality of Salesperson serving in the Organization

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 6: Management of Sales Territory


Designing Sales Territory
Step 1: Select Appropriate Geographical Control Unit
Small enough to allow Flexibility but not so small that High Level of
Data Computation is needed
Homogenous and of Reasonable size to achieve Economies of Scale
The Basic units can be Country, State, District, Division or Block
with Clear Boundaries
Basic Control Units should be based on Trading Area. A Treading
Area is made up of a Principal City and the surrounding dependent
area

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 6: Management of Sales Territory


Designing Sales Territory
Step 2: Criteria
Managers identify the Sales Potential of each Geographical Control
Unit based on Current Customer Base as well as Future Customer
Base
Based on Forecasted Sales (for both Current and Potential
Customers) and Geographic Size Managers Combine Contiguous
Control Units to form Territories
Each Sales Territory should as Equal as Possible in terms of Market
Potential
Differences in the Workload and Sales Potential due to different
Levels of Competitive Activity are ignored at this stage
It is also assumed that all Salespeople have equal Experience and
Capabilities
Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 6: Management of Sales Territory


Designing Sales Territory
Step 3: Starting Point
After ascertaining Sales Potential in Control Units, a Sales Manager
should form Tentative Sales Territories
Location Point
Trading Area
Location of Large Account
Central Geographic Location or State Capital

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 6: Management of Sales Territory


Designing Sales Territory
Step 4: Territory Shapes
Shape of Territory affects the Sales Expenses and Ease of Coverage
and Less Time on Travel
Wedge Shaped: Used by FMCGs which serve both Urban and
Rural Areas
Circular Shaped: These are suitable when companies have
their accounts distributed across equally sized areas.
Salesperson is located in Central Part of the Territory and
Travels uniformly to different areas
Cloverleaf Shaped: It is used when accounts are distributed
randomly through out the Territory

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 6: Management of Sales Territory


Designing Sales Territory
Step 5: Control Units Adjacent to Starting Point
After deciding Starting Point Sales Managers then combine Control
Units to build up Market
Sales Manager keeps on running totals on the Allocation Criteria for
each newly designed Territory
The process continues until all Control Units are assigned to each
Sales Person
At this Level, Sales Territories are tentative and necessary
adjustments can be made in future on the basis of Scope of Market
Coverage

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 7: Management of Sales Quota


Learning Objectives

Sales Quota
Importance of Sales Quota
Principles of Setting Quota
Procedure for Setting Quota
Types of Sales Quota
Methods of Setting Sales Quota
Quotas Based on Sales Forecasts and Potentials
Quotas Bases of Forecasts
Quotas Based on Past Sales or Experience
Quotas Based on Executive Judgement
Quotas Based on Salespeople Judgement
Quotas Based on Compensation

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 7: Management of Sales Quota


Sales Quota
Sales Quota are the Targets (Sales Target and Duties) that Salespeople try
to achieve within a Specific Period of Time, which contributes towards
achieveing the Organizational Goals regarding Sales Forecasts

It is an expected Performance Objective

Quotas are assigned to Sales Units such as Departments, Divisions and


Individuals

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 7: Management of Sales Quota


Importance of Sales Quota

Motivating Salespeople

Management by Expectation

Objectivity in Measurement and linked with Reward Systems


Feedback on Performance

Focus on High Performers and taking care of their Interests


Focus on Poor Performers and making efforts in their Skill Building

Giving Direction to Salespeoples Performance


Rewards are linked with attainment of Quotas and Desired Type & Level
of Behaviors can be achieved
Performance based on Sales Volume in Product Categories, New
Accounts and Expenses

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 7: Management of Sales Quota


Principles of Setting Sales Quota

Objectivity

Based on Facts & Figures drawn from Market

Simples Method should be used

Easy to understand by all stakeholders

Uniform for all Salespeople by taking Competition Level, Experience &


Ability of Salespeople

Achievable Limit

Level of Definiteness

Should be fixed in Terms of Goegraphic Territory, Money Value or Units


Frequent Changes in Quotas can create problems

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 7: Management of Sales Quota


Procedure for Setting Sales Quota

Schedule Planning
Planning for Goal Setting Meetings
Explaining Systems, Reasons, Benefits and Incentives for each
Salesperson
Orientation Sessions
Submission of Individual Goal Proposals

Conferencing with Each Salesperson


Discussion of Individua; Goal Proposals
Territory, the Account, the Call Management and Self Management
Volume per Month, Expense per Month, Gross Margin per Month, Market
Share per Month and Key Account Coverage per Month

Written Summary of Agreed Upon Goals

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 7: Management of Sales Quota


Types of Sales Quota

Sales Volume Quota

Sales Budget Quota

Monetary Terms and Unit Terms


Variuos Product Lines

Control Expenses
Profit Quota: Gross Margins and Net Profit

Sales Activity Quota

Quota can be set on Activity Level instead of Final Outcome


Prospecting, Generate Sales Leads, Develop New Buisness

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 7: Management of Sales Quota


Methods of Setting Sales Quota

Quotas Based on Sales Forecasts and Potentials

Quotas Bases of Forecasts

Quotas Based on Past Sales or Experience

Quotas Based on Executive Judgement

Quotas Based on Salespeople Judgement

Quotas Based on Compensation

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 8: Recruitment & Selection of the Sales Force


Learning Objectives

Hiring Process
Challenges in Sales Force Selection
Sales Force Recruitment
Sources
Selection of a Salesperson
Socialization

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 8: Recruitment & Selection of the Sales Force


Hiring Process
Turnover

Strategic Position Analysis

JQ & JD

Decide No. of Salespeople to be hired


Planning

Identify Sources of Recruitment

Recruitment

Generate Database of Candidates

Evaluate Candidates
Selection

Select and Induce

Socialization

Socailize

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 8: Recruitment & Selection of the Sales Force


Sources for Sales Forces Recruiment

Internal Sources
Lateral & Upward Moves
Intern & Cooperative Students
Emplyee Referral Programmes

External Sources

Other Industry Sources


Educational Intitutions and Campus Recruitments
Advertising
Employment Agencies
Walk In
Networking
Web Sources

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 11: Sales Force Compensation


Learning Objectives

Objectives of Sales Compensation Plan


Characteristics of an Effective Compensation Plan
Factors Influencing the Design of Compensation Plan
Types of Compensation Plan
Financial Compensation
Non Financial Compensation

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 11: Sales Force Compensation


Objectives of Sales Compensation Plan

Attract Quality Sales People

Retaining Quality People and Reducing Attrition

Improve Prodcutivity Level

Maximise Sales and Reducing Sales Expensed & Production Cost

Good Rapport between Sales Managers & Salespeople

Better Company Image

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 3: The Selling Process


Learning Objectives
Prospecting
Identifying Prospects
Qualifying Prospects MAN
Preparing
Pre-approach
Call Planning
Presenting
Approach
Probe for Needs
Convince the Prospect
Handle Objections
Close
Follow Up

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 3: The Selling Process


The Selling Process
It is a process by which a salesperson

Identifies and Locates Prospects


Separates the prospects from Suspects
Approaches them
Makes a Sales Presentation
Handles their Objections
Close a Sale
He also Follows Up with the Existing Customers to Identify further
Sales Leads, Measure Success and Customer Satisfaction Level of
Current Products & Service Offerings

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 3: The Selling Process


The Selling Process

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 3: The Selling Process


Prospecting
It is a process by which a salesperson
Identify Potential Buyers who have Need for Products & Services
The Ability to Pay for it
The Adequate Authority to Buy it
Prospecting is important for Effective Utilization of Selling Time by
distinguishing the Prospects from Suspects
Key Steps involved in Prospecting Process are:
Define Target Market
Generating Sales Leads
Qualifying Prospects (MAN)

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 3: The Selling Process


Prospecting

Define Target Market

Generate Sales Leads

Determining the type of Person or Organization which is most likely to


buy a Product or Service
Salesperson can be helped by Researchers, Product Managers, Market
Planners and Sales Managers for Defining Target Market
Networking
Market Survey

A Sales Lead is any Specific Person or Organization that might Need a


given Product or Service

Qualifying Prospects
Qualifying means: Need and/ or Desire to Buy >> Financial
Resources >> Authority
MAN: Money > Authority > Need

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad

Chapter 3: The Selling Process


Prospecting

Identifying Prospects

Present Customers
Former Customers
Cold Calling
Spotters
Directories and Mailing Lists
Prospecting Services

Referrals
Center of Influence Approach
Endless Chain Prospecting

Personal Contacts
Trade Shows and Exhibits
Direct Marketing

Prepared By: Hamid Ali Raza | Source: Sales & Distribution Management by Tapan K. Panda & Sunil Sahadev | Preston University, Islamabad