Sales & Distribution Management:

1. What is direct selling? Write the various techniques how a seller can do direct selling? (8)

Ans. Direct selling is a form of retail in which products and services are marketed directly to
consumers. Direct selling generally takes place one to one, in a group setting, party or
online. The personal component is what makes our channel unique. It is best known for
doorstop, party plan and network marketing or a combination of these methods. Direct
selling is about connecting people and building relationships while offering personal
attention and quality service. These attributes are seeing direct selling move into more
omni-channel forms of retail.

Various techniques of direct selling are:

1. SET GOALS
The only way to achieve your goals is to set them in the first place. We all have goals and
ideas floating around in our heads—take the time to sit down and write them on paper.
Creating a tangible list to go back to will help you hold yourself accountable and give you
something to strive for, even on your most difficult selling days.

2. STAY POSITIVE
When you work in sales, staying positive is absolutely essential to finding success. Not
everyone will want to buy your product, and you’ll likely be told “no” more times than you
ever imagined, but through everything, you need to remain positive. Maintaining an
excitement about your job and the product will help you sell better and find more success
overall in your direct selling career.

3. NEVER STOP LEARNING

The day you stop learning and working to improve your selling skills is the day your career
will stall. Take classes, read books, and attend retreats and conferences like those held by
ASEA that will help you improve your selling skills. Even if you think you’ve heard it all
before, never stop seeking knowledge that will help you in your direct selling career.

4. TIME MANAGEMENT IS KEY

How can you expect a person to buy a product from you or want to join your sales team if
you can’t even manage to keep on top of your own schedule? Missing appointments for any
reason is unprofessional, and will ultimately leave you looking unreliable. Never
overestimate the time you have available to work with customers and team members—you
need to show up when you say you will, or your business will suffer.

5. STAY ORGANIZED
Whether you choose to keep track of your business with the help of an online program, or
even just a simple daily planner, make sure you are doing something to keep yourself
organized. Create a filing system, keep a list of contacts, and make sure you have easy access
to all business information. Establish a system from day one so you don’t have to scramble
to get on top of things when your business takes off.

6. CREATE A DESIGNATED WORKSPACE

 Even if it’s just on a card table in the corner of your basement, you need to create a
workspace designated to your job. Having a place set aside solely for work will allow you to
disconnect from everything else and really devote yourself to building your business.

7. NETWORK, NETWORK, NETWORK!

Without networking, you’ll never be able to build a business larger than your friends and
family. Think of every encounter with a new person as an opportunity to network, whether
it’s in person or on social media. The more people you meet, the more opportunities you
have to make a sale. Incorporate the products you’re selling, whether it’s lipstick or redox
supplement, into every conversation you have.

8. KEEP MAKING CONNECTIONS

You need to continue to make connections with people. Tell your story on social media,
sharing how this product or the company have made your life better. The more you can
show what a life-changer this opportunity is for you, the more people will want to try your
product and have what you have.

9. KEEP THE PASSION ALIVE

Never lose your passion for selling. Even on the most difficult days when selling is the last
thing you want to do, you need to remember why you’re doing this job and keep the fire
burning. The most successful people in life keep the passion alive and never give up.

10. PLAN FOR THE WORST, HOPE FOR THE BEST

As with almost any situation in life, it’s wise to be prepared for the worst case scenario. This
will allow you to accept failure and defeat more gracefully while continuing to trudge on
toward your ultimate goal. Keep the hope alive that things will work out and continue to
work hard, and eventually you will find success.

2. What is closing? Write the various techniques of closing. Which techniques do you find
superior over the other? Justify. (8)

Ans. Closing is generally defined as the moment when a prospect or customer decides to
make the purchase. Very few prospects will self-close, making it necessary for the
salesperson to instigate the close. This can be unnerving, especially for new salespeople, as
it leaves the salesperson open to the chance of rejection from the prospect.

Techniques of closing:

Basic Closes
These basic closing techniques are fairly simple to implement and will work on a wide range
of prospects. If you presented the product well (and addressed the prospect's objections)
but they need an extra nudge, these will do the trick.

Intermediate Closes
Once you've mastered the art of the basic close, you're ready to try your hand at some
intermediate-level strategies. These closes aren't necessarily more difficult than the basic
 closing strategies, but they tend to be more complex. Closing techniques at this level can
save a sale that has not gone well when you have reached the end of the sales process.
Advanced Closes
These closes are a bit trickier than the basic and intermediate closes. Advanced closes
require more setup time or more willingness on your part to push the prospect harder.
While these take more finesse or assertiveness, when used wisely, they can seal the deal
with prospects who otherwise wouldn't buy from you.

3. Write the various functions of sales management. (8)

Ans. Functions of sales management are:

1. Sales Planning-
Sales Planning is the first functions of sales management and it means that the role of a sales
manager is to facilitate planning. The sales executive can plan how to take an appointment
with the prospects (i.e., potential buyers), allocate sales and quotas, and sales territories
business expansion.

This point is also helping to identify the target market of a sales individual.

2. Recruitment and Selection-

Recruitment is the second functions of sales organization/ management and it means that
the sales manager recruits the right person or individual with appropriate selling skills and
select him for a sales job. This function is very essential for the sales department because it
helps to choose the effective manager or employee for the organization.

The recruitment can be classified into two categories such as an internal source of
recruitment and external source of recruitment.

3. Training-
Training is the third functions of sales management and it means, it is a very important
function of sales manager. Since it enhances the skills, potential, knowledge, and ability of a
salesperson to take challenging jobs and perform effectively.

If an organization wants to increase the sales potential of sales executives then it will have to
provide proper training facilities and development programs also.

4. Motivation & Remuneration-

Motivation is the fourth functions of sales management and it is very necessary to attain the
sales target. It helps in understanding the means, emotions, sentiments, and expressions of
a particular sales executive. While remuneration will help in the compensation structure of a
salesperson.

5. Equipping-
Equipping is the fifth functions of sales organization/management and it means that the
sales manager equipped the sales team so that the team is ready with templates, brochures,
price list, yellow papers, hoardings which can facilitate the sales.
6. Relationship Building-

Functions of Sales Management

Image Source: pixabay.com

The relationship is the sixth functions of sales management and it means that the critical
task of a sales manager is to acquire the prospects, grow the customers, build the
customers, manage the customers and retain them through relationship marketing.

7. Attainment of Sales Target-

Attainment factor is the seventh functions of sales organization/management and it means
that the ultimate objective of a sales manager is to maximize the sales revenue. He will be
responsible for the attainment of sales target by himself and also by the team.

Thus, the achievement of a sales target helps to grow the business or an organization in an
effective or efficient manner.

8. Delegation-
Delegation is the eighth functions of sales department/management and it means that the
degree of control and accountability is possible through delegation. There will be a grouping
of jobs along with the concerned authority so that work is completed within a stipulated
period of time.

However, delegation is also known as the transfer of something (it can be work, power, etc).

9. Supervising-
Supervising is the ninth functions of sales management/representative and it means that the
task of the sales manager is to supervise the actions of sales executives so that he can rectify
any deviations if possible.

10. Allotment of Sales Territories-

Allotment strategy is the tenth functions of sales manager and it means that the sales
territories refer to the grouping of customers over a particular area. Companies allot sales
territories to sales representatives so that there is complete the coverage of the market.

11. Allocation of Sales Quotas-

Functions of a sales manager

Image Source: pixabay.com

Allocation strategy is the eleventh functions of sales management and it means that the
sales quota refers to the quantitative targets assigned to individuals salesperson. These are
responsible for planning, controlling, and evaluation of personal selling activities.

12. Sales Budget Preparation-

 The sales budget is the twelfth functions of a sales manager and it means that they comprise
of personal selling function expenses, expenses involved in transportation, promotional
expenses, tele-calling expenses and so on.

13. Communication-
Communication is the thirteenth functions of sales management and it means that the sales
manager maintains proper communication between various sales executives and inform the
top level of management about the sales targets or revenue attained.

14. Sales Controlling-

The sales controlling is the fourteenth functions of sales management and it means if there
is the deviation in actual sales then the salesperson makes corrections sales targets attained
so that mismatch between actual sales and desired sales could be minimized.

4. What is a sales budget? What is the purpose of the sales budget?

Ans. A sales budget estimates the sales in units as well as the estimated earnings from these
sales. Budgeting is important for any business. Without a budget companies can’t track
process or improve performance. The first step in creating a master company while budget is
to create a sales budget. Management carefully analyzes economic conditions, market
competition, production capacity, and selling expenses when developing the sales budget.
All of these factors play an important role in the company’s future performance. Basically,
the sales budget is what management expects to sell and the revenues collected from these
sales.

Purpose of sales budget:

 Determine Sales Goals: Sales budget sets a target for the sales team which they have
to achieve. The expected sales volume for a particular period is determined, and the
efforts of the sales department are directed accordingly.
 Cash Flow Management: The company can estimate its future cash inflow and
outflow through sales budgeting. This helps in determining the potential liquid cash
and prepares for unfavorable market conditions.
 Estimate Overhead Costs: It also estimates the various administrative and sales
expenses which the company has to bear other than the manufacturing cost, thus
determining the potential profit margin.
 Develop Core Strategies: A sales budget provides a base for action to the managers.
The managers frame their strategies and utilize the resources to attain the desired
sales goals.
 Streamlines Business Process: All the business activities, i.e. production of goods or
services, financing the operations, engaging the human resource and marketing
activities are based on the prepared sales estimate.

5. Discuss the role of distribution management in the marketing mix.

 Ans. Roles of distribution management in marketing mix are:

1) Increasing specialization. The deepening of the division of labour and broadening its
product range in production, encourages specialization in distribution. Even if the effects
of this trend are mostly positive, acquiring them may face some specific obstacles. Thus,
with the growing demands, the consumer claims ample opportunities, which cannot be
provided but within the framework of a high experienced trading activity. On the other
hand, the same consumer wishes to minimize the time involved for purchasing goods,
which can be achieved mainly through the distribution offered by broad profile stores.
2) Increasing concentration has its source, including the distribution, in the undeniable
advantages of the scale economy. In the distribution sector, this trend has some
peculiarities, manifested less pronounced than in production - given its role as link
between production, with an ever-increasing degree of concentration, and consumption
with a large scattering in space. In general, the degree of concentration in distribution
channels decreases as we get closer to consumers. In perspective, the trend of
increasing concentration although it seems to widen, it will occur at the company level
and at the level of the operative unit (store, warehouse, etc.). Thus, at company level
there is possible to register very high levels of concentration (through the accumulation
of capital, takeovers, and mergers). But at the level of operative units, the degree of
concentration evolves noticeably slower, given that the number of hyper and
supermarkets will be further reduced.
3) Increased level of integration is in distribution (as in other fields), among others, the
result of the merger, the trend manifesting itself both in terms of vertical integration
and horizontal one. Vertical integration consists in associating some distribution
participants to obtain certain benefits, such as streamlining the flow of goods to the
consumer, correlation of promotional activities and others, reducing distribution costs,
etc. It is initiated by the manufacturer, wholesaler or retailer, and it may be total or
partial (comprising the entire channel or part of it), assuming varying degrees of
cohesion and autonomy of the components of the integrated structures. Horizontal
integration involves the association of some middlemen of the same link of the
distribution channel. If this case there do not occur great changes in the spread of the
functions of distribution, enlarging only their scale and yield.
4) The increase of costs in distribution is a trend with major implications in the
development of this process. By successive mark-ups, expansion and increasing and the
growth of complexity have made of it a factor of growth of the final price paid by
consumers of products. Thus, currently, especially in developed countries, these costs
represent about half the price of goods - thus existing some products (mineral water,
milk, vegetables and fresh fruit imported raw materials, etc.) for which the distribution
share be much higher than the production costs.

6. Explain all the functions of intermediaries.

Ans. Functions of intermediaries:

Direct and Indirect Channels

Manufacturers sell products and services to their customers through direct and indirect
channels. Where manufacturers sell direct to customers through their own salesforce or
 website, they do not require intermediaries. If they wish to sell to customers and prospects
their sales teams cannot reach, they appoint intermediaries to act on their behalf.
Intermediaries may have additional resources and relationships to supplement to a
manufacturer’s own sales and marketing resources, enabling it to reach a wider customer
base.

Selling Through Agents

Agents act as independent representatives for manufacturers, selling to other intermediaries
such as wholesalers or retailers. These agents can be individuals or companies. Agents earn
commission or fees for the sales they make or the services they provide. They form a
valuable extension to a manufacturer’s internal sales resources.

Reaching More Customers Through Retailers

Independent stores and retail chains sell products to consumers and business customers. By
appointing retailers, manufacturers can reach different areas of the country and target
smaller customers they could not afford to serve directly. Retailers buy products for resale
direct from manufacturers or from wholesalers. They generally stock goods from many
different suppliers, including competitive offerings in the same product category, so
manufacturers must use incentives and discounts to encourage retailers to push their
products in order to achieve strong sales.

Simplifying Logistics through Wholesalers

Wholesalers buy products in bulk from a number of different manufacturers, stocking them
in warehouses and selling them to retailers. By holding stock, wholesalers enable
manufacturers to supply customers in different regions without investing in their own
warehousing facilities. Wholesalers also help manufacturers reduce their logistics costs by
delivering stock to retailers or offering stores a collection service.

Cooperative Marketing Through Distributors

Distributors carry out similar functions to wholesalers, but generally have closer working
relationships with manufacturers. Distributors may have exclusive arrangements with
manufacturers and do not carry competing products. They may be part of a franchise, only
offering the products of one manufacturer. Like wholesalers, they provide valuable
warehousing and logistical functions for manufacturers. They may also participate in
cooperative marketing programs with suppliers, improving sales for manufacturers.

7. How does distribution add value to the marketing efforts?

Ans.

Channel switching: Channel-switching (not to be confused with zapping or channel surfing

on TV) is the action of consumers switching from one type of channel intermediary to a
different type of intermediary for their purchases. Examples include switching from brick-
and-mortar stores to online catalogues and e-commerce providers; switching from grocery
stores to convenience stores or switching from top tier department stores to mass market
discount outlets. For the consumer, channel switching offers a more diverse shopping
experience. However, marketers need to be alert to channel switching because of its
potential to erode market share. Evidence of channel switching can suggest that disruptive
 forces are at play, and that consumer behaviour is undergoing fundamental changes. A
consumer may be prompted to switch channels when the product or service can be found at
cheaper prices, when superior models become available, when a wider range is offered, or
simply because it is more convenient to shop through a different channel (e.g. online or one-
stop shopping).

Customer value: The emergence of a service-dominant logic perspective has focussed

scholarly attention on how distribution networks serve to create customer value and to
consider how value is co-created by all the players within the distribution chain, including
the value created by customers themselves.[16] This emphasis on value-creation is
contributing to a change in terminology surrounding distribution processes; "distribution
networks" are often termed value-chains while "distribution centres" are often termed
customer fulfillment centres. For example, the retail giant Amazon, which utilises both direct
online distribution alongside bricks and mortar stores, now calls its despatch centres
"customer fulfillment centres".

Disintermediation: Disintermediation occurs when manufacturers or service providers

eliminate intermediaries from the distribution network and deal directly with purchasers.
Disintermediation is found in industries where radically new types of channel intermediaries
displace traditional distributors. The widespread public acceptance of online shopping has
been a major trigger for disintermediation in some industries. Certain types of traditional
intermediaries are dropping by the wayside.

8. What are the methods used for assessing training needs of salesperson?

Ans. [Not Found]

9. Explain the various channel levels with examples. (5)

Ans. Various channel levels are:

1. Zero-Level Channel: When the distribution of the product is direct from the producer to
the consumer or the user. This is also called direct selling.

2. One-Level Channel: In this method an intermediary is used. Here a manufacturer sells the
goods directly to the retailer instead of selling it to agents or wholesalers. This method is
used for expensive watches and other like products. This method is also useful for selling
FMCG (Fast Moving Consumer Goods).

3. Two-Level Channel: In this method a manufacturer sells the material to a wholesaler, the
wholesaler to the retailer and then the retailer to the consumer. Here, the wholesaler after
purchasing the material in large quantity from the manufacturer sells it in small quantity to
the retailer.
Then the retailers make the products available to the consumers. This medium is mainly
used to sell soap, tea, salt, cigarette, sugar, ghee etc.

4. Three-Level Channel: Under this one more level is added to Two Level Channel in the
form of agent. An agent facilitates to reduce the distance between the manufacturer and
 the wholesaler. Some big companies who cannot directly contact the wholesaler, they take
the help of agents. Such companies appoint their agents in every region and sell the material
to them.
Then the agents sell the material to the wholesalers, the wholesaler to the retailer and in the
end the retailer sells the material to the consumers.

10. What are the major retail formats in India? What are the characteristics of each of them? (5)

Ans. Major retail formats in India:

Mom-and-pop Stores
These are small family-owned businesses, which sell a small collection of goods to the
customers. They are individually run and cater to small sections of the society. These stores
are known for their high standards of customer service.

Department stores
Department stores are general merchandisers. They offer to the customers mid- to high-
quality products. Though they sell general goods, some department stores sell only a select
line of products.

Category Killers
Specialty stores are called category killers. Category killers are specialized in their fields and
offer one category of products. Most popular examples of category killers include electronic
stores like Best Buy and sports accessories stores like Sports Authority.

Malls
One of the most popular and most visited retail formats in India is the mall. These are the
largest retail format in India. Malls provide everything that a person wants to buy, all under
one roof. From clothes and accessories to food or cinemas, malls provide all of this, and
more. Examples include Spencer’s Plaza in Chennai, India, or the Forum Mall in Bangalore.

Discount Stores
Discount stores are those that offer their products at a discount, that is, at a lesser rate than
the maximum retail price. This is mainly done when there is additional stock left over
towards the end of any season. Discount stores sell their goods at a reduced rate with an
aim of drawing bargain shoppers.

Supermarkets
One of the other popular retail formats in India is the supermarkets. A supermarket is a
grocery store that sells food and household goods. They are large, most often self-service
and offer a huge variety of products. People head to supermarkets when they need to stock
up on groceries and other items. They provide products for reasonable prices, and of mid to
high quality.

Street vendors
Street vendors, or hawkers who sell goods on the streets, are quite popular in India. Through
shouting out their wares, they draw the attention of customers. Street vendors are found in
 almost every city in India, and the business capital of Mumbai has a number of shopping
areas comprised solely of street vendors. These hawkers sell not just clothes and
accessories, but also local food.

Hypermarkets
Similar to supermarkets, hypermarkets in India are a combination of supermarket and
department store. These are large retailers that provide all kinds of groceries and general
goods. Saravana Stores in Chennai, Big Bazaar and Reliance Fresh are hypermarkets that
draw enormous crowds.

Kiosks
Kiosks are box-like shops, which sell small and inexpensive items like cigarettes, toffees,
newspapers and magazines, water packets and sometimes, tea and coffee. These are most
commonly found on every street in a city, and cater primarily to local residents.

11. What are the three main areas that give rise to channel conflicts? Explain them in brief. (5)

Ans. Three main areas of channel conflict are:

1) Horizontal channel conflicts

One of the most common type of channel conflicts to occur are the horizontal ones.
Horizontal channel conflict is a conflict between two players at the same level in the
distribution channel. So a conflict between 2 distributors or a conflict between 2 retailers is
known as horizontal channel conflict.

Example of Horizontal channel conflict

There are two stores in a region which are given a territory each. Store 1 is given territory 1.
Store 2 is given territory 2. Now the channel conflict occurs, when store 1 services customers
from territory 2 or vice versa. This means that the channels are not following rules set by the
company and hence it is creating conflict.

2) Vertical Channel conflict

Another type of conflict seen in channel management is the Vertical channel conflict. Where
the horizontal channel conflict exists between players within the same level of the
distribution channel, the vertical channel conflict happens at different levels of the
distribution channel. A typical conflict might be between the retailer and the distributor, or
it might be between the distributor / C&F and the company.

Example of vertical channel conflict –

Let’s take the example of an Ice cream company. To motivate its dealers, many ice cream
companies provide FREEZERS at discounted price along with the ice cream to their retailers.
These freezers are used to keep the ice cream at frozen temperatures. Now, an ice cream
company notices that Region 1 is not performing well and it can motivate region 1 by
providing the freezer completely free. So, it gives freezers for free in the market with ice
cream so that ice cream sale rises. It actually does and because retailers are taking the
freezer for free, they are stocking more ice cream and selling more ice cream. The company
is happy.
 3) Multiple channel conflict
Because of their very nature, vertical channel conflicts happen rarely, but once they
happen, they have a long lasting effect. In the recent decade, we have seen some fantastic
examples of Multi-channel conflicts.

When Small retailers and businessmen were thriving in business, Modern retail came in the
picture. Large hypermarkets and malls were started where people could do all their
shopping. An altogether different distribution channel was created. Due to their bulk buying
power, these hypermarkets were giving huge discounts and making huge sales as well.

12. E-choupal is a concept which can be extended by many companies to improve distribution in
rural areas. Discuss this topic. (5)

Ans. POINTS TO SUPPORT E-CHAUPAL MODEL

The e-Choupal experience highlights that ICT platforms can provide rural connectivity and e-
commerce support. These platforms have enormous potential provided they are
conceptualized for the specific needs of the community and business. Some of the elements
that helped the e-choupal to work successfully are discussed below:

1. Comprehensive knowledge of rural markets:

Rural markets are both economic and social networks and there is a strong connection
between the operation of social and economic transactions. Understanding the operations is
vital before the systems are conceptualized. Use of local population, as much aspossible
helped the network to get the acceptance closely.

2. Designing a Win-Win transaction model:

The success of e-choupal comes from the condition in which both the farmer and the
processor share the benefits coming out of the elimination of middle men and due to timely
information availability.

3. Leveraging the logistics channels:

The existing logistics of the rural markets are leveraged but they are not able to exploit the
information asymmetry (unlike that in a conventional market). In that sense e-choupal uses
the local institutions but eliminates the information asymmetry that they used previously.

4. Selection of Sanchalak:
Both the selection of Sanchalak and the acceptance of Sanchalak by the community are very
critical for the success of e-choupal. ITC used a trial and error method for developing the
procedure for selecting Sanchalaks. In the platform terminology Sanchalak is the interface
for maintaining the platform. For the farmer the Sanchalak is the e-choupal. Training and
sensitizing him for the crucial role has been the main reason for the acceptance of the
Sanchalak by the farmers. Sanchalak, thus, acts as the coordinator of the knowledge
community, and a representative of farming community.

5. Evolving an appropriate user interface:

Technology interface used in rural areas have to be very simple. Interface has to be tried for
rural settings and only after its validation it has to be used. Firstly, one has to understand the
user pattern and secondly, it has to be tried, tested and validated. For example, farmers do
 not understand the concept of insurance. e-Choupal evolved a simple interfacing
arrangement that a farmer can understand.

6. Bottom-up model for entrepreneurship:

e-Choupal encourages enormous amount of creativity at the local level along with local
entrepreneurship stimulation. The farmer and Sanchalak are free to use the e-choupal and
develop new uses. e-choupal unleashes the creative spirit in the rural India. e-choupal
concept helped in the creation of skilled personnel in rural communities.

13. What is a sales territory? Why is it necessary for companies to establish sales territories? (5)

Ans. Sales territory is a designated geographical area (or any other parameter-based
grouping) which is assigned to a sales group. This sales territory is responsibility of that
particular sales team. The sales team ensures that the sales in that area increase and meets
sales targets every year. Any company creates a territory based on geographic area,
population demographics, sales potential etc. This territory is assigned to sales persons as
their operating territory. They cannot go beyond this territory in ideal scenario.

Importance of Sales Territory

Dividing the territory has a specific purpose. The sales territories are identified based on any
one of the factors stated above. The division is made to balance the workload among the
sales persons. Otherwise someone may end up doing more sales and less customer service
and someone may do less sales and more customer service. In both of these cases the
company ends up losing. In the former case the customers may switch to other brand due to
less customer service and hence there will be loss in terms of SKUs sold in the long run. In
the latter case the company may spend too much on a few customers and hence the per-
unit cost to the company will increase.
Thus, each sales representative will have his own target based on the sales territory and it
leads to improved efficiency and competition among the sales reps which adds to the profit
of the company.

14. Describe briefly the common types of quotas set by companies for sales people. (5)

Ans. Common types of Sales Quota set by companies are:

1. Revenue Quotas
The most common type of sales quota is revenue-based. Reps are expected to sell enough
units or subscriptions to earn a certain amount of revenue for the given period.
This type of sales quota is usually set for the quarter or the month. However, businesses in
industries with a longer sales cycle might use annual revenue quotas. For instance, since
many SaaS companies operate on monthly contracts, they might choose to set quotas based
on the value of the client’s annual contract.
Revenue quotas can refer to net revenue, especially in cases where prices are flexible and
upselling is common or expected. If your products have a range of different profit margins,
you might use profit quotas instead of focusing on revenue. Profit quotas incentivize reps to
spend time selling items that yield a higher profit.
2. Activity Quotas
 Another option is to create quotas based on sales activity. This can include the number of
new clients landed for a given period. However, it can also expand to include activities that
are part of the sales process but don’t translate directly into sales.
For example, reps might be expected to make a certain number of phone calls every week,
book a certain number of meetings per month, or close a certain number of deals by the end
of the quarter.
3. Volume Quotas
Quotas based on volume incentivize reps to move a certain amount of inventory or register
a certain number of new users. These types of quotas are often set for the team to achieve
over a given year. Depending on the business, the quota might break down further by
region, product, or individual sales rep.
4. Combination Quotas
Many sales teams operate with some combination of sales quotas in place. Combined
quotas often involve an aspect of both sales volume and rep activity. For instance, reps
might be asked to set ten appointments with new prospects and close 40% of those leads for
a total of four new customers.
However, setting too many different types of quotas can be problematic if it causes your
sales team to become unfocused. When in doubt, prioritize a select few activities or
benchmarks that you want your team to prioritize, rather than asking everything of your
sales reps.

15. Mention the various internal and external sources used by companies for locating or
identifying the prospective candidates. Why employee’s referral programme or schemes are
becoming one of the most popular methods of locating sales recruits? (5)

Ans. Internal Sources:

Best employees can be found within the organisation… When a vacancy arises in the
organisation, it may be given to an employee who is already on the pay-roll. Internal sources
include promotion, transfer and in certain cases demotion. When a higher post is given to a
deserving employee, it motivates all other employees of the organisation to work hard. The
employees can be informed of such a vacancy by internal advertisement.

Methods of Internal Sources:

The Internal Sources Are Given Below:
1. Transfers: Transfer involves shifting of persons from present jobs to other similar jobs.
These do not involve any change in rank, responsibility or prestige. The numbers of persons
do not increase with transfers.
ADVERTISEMENTS:
2. Promotions: Promotions refer to shifting of persons to positions carrying better prestige,
higher responsibilities and more pay. The higher positions falling vacant may be filled up
from within the organisation. A promotion does not increase the number of persons in the
organisation.
A person going to get a higher position will vacate his present position. Promotion will
motivate employees to improve their performance so that they can also get promotion.
3. Present Employees: The present employees of a concern are informed about likely vacant
positions. The employees recommend their relations or persons intimately known to them.
Management is relieved of looking out prospective candidates.
The persons recommended by the employees may be generally suitable for the jobs because
they know the requirements of various positions. The existing employees take full
responsibility of those recommended by them and also ensure of their proper behaviour and
performance.

External Sources:
All organisations have to use external sources for recruitment to higher positions when
existing employees are not suitable. More persons are needed when expansions are
undertaken.

Methods of External Sources:

1. Advertisement:
It is a method of recruitment frequently used for skilled workers, clerical and higher staff.
Advertisement can be given in newspapers and professional journals. These advertisements
attract applicants in large number of highly variable quality.
Preparing good advertisement is a specialised task. If a company wants to conceal its name,
a ‘blind advertisement’ may be given asking the applicants to apply to Post Bag or Box
Number or to some advertising agency.
2. Employment Exchanges:
Employment exchanges in India are run by the Government. For unskilled, semi-skilled,
skilled, clerical posts etc., it is often used as a source of recruitment. In certain cases it has
been made obligatory for the business concerns to notify their vacancies to the employment
exchange. In the past, employers used to turn to these agencies only as a last resort. The
job-seekers and job-givers are brought into contact by the employment exchanges.
3. Schools, Colleges and Universities:
Direct recruitment from educational institutions for certain jobs (i.e. placement) which
require technical or professional qualification has become a common practice. A close
liaison between the company and educational institutions helps in getting suitable
candidates. The students are spotted during the course of their studies. Junior level
executives or managerial trainees may be recruited in this way.
4. Recommendation of Existing Employees:
The present employees know both the company and the candidate being recommended.
Hence some companies encourage their existing employees to assist them in getting
applications from persons who are known to them.
In certain cases rewards may also be given if candidates recommended by them are actually
selected by the company. If recommendation leads to favouritism, it will impair the morale
of employees.
5. Factory Gates:
Certain workers present themselves at the factory gate every day for employment. This
method of recruitment is very popular in India for unskilled or semi-skilled labour. The
desirable candidates are selected by the first line supervisors. The major disadvantage of this
system is that the person selected may not be suitable for the vacancy.
6. Casual Callers:
Those personnel who casually come to the company for employment may also be
considered for the vacant post. It is most economical method of recruitment. In the
advanced countries, this method of recruitment is very popular.
7. Central Application File:
A file of past applicants who were not selected earlier may be maintained. In order to keep
the file alive, applications in the files must be checked at periodical intervals.
8. Labour Unions:
In certain occupations like construction, hotels, maritime industry etc., (i.e., industries where
there is instability of employment) all recruits usually come from unions. It is advantageous
from the management point of view because it saves expenses of recruitment. However, in
other industries, unions may be asked to recommend candidates either as a goodwill
gesture or as a courtesy towards the union.
9. Labour Contractors:
This method of recruitment is still prevalent in India for hiring unskilled and semi-skilled
workers in brick klin industry. The contractors keep themselves in touch with the labour and
bring the workers at the places where they are required. They get commission for the
number of persons supplied by them.
10. Former Employees:
In case employees have been laid off or have left the factory at their own, they may be taken
back if they are interested in joining the concern (provided their record is good).
11. Other Sources:
Apart from these major sources of external recruitment, there are certain other sources
which are exploited by companies from time to time. These include special lectures
delivered by recruiter in different institutions, though apparently these lectures do not
pertain to recruitment directly.
Then there are video films which are sent to various concerns and institutions so as to show
the history and development of the company. These films present the story of company to
various audiences, thus creating interest in them.

Reasons for popularity of Employee Referral Programme are:

Higher Quality of Hire

Even with all the information candidates include on their applications, it can be difficult to
tell how good of a fit an individual will be for the position without a few rounds of
interviews. And while you should still take time to interview referred candidates, the
chances of those individuals being good fits are much higher than someone you know by
resume alone.
That’s because employees know that when they refer someone for a position, the quality of
that candidate will reflect on them as well. The risk of being responsible for bringing in a
poor-quality candidate for an interview – or worse, being responsible for a bad hire – leads
most employees to carefully reflect on the person’s skills and qualifications before making
the referral. They’re also likely to help the candidate prepare for the interview process,
giving the candidate a better understanding of the company, position and responsibilities.
Reach Passive Candidates
One of the biggest advantages of a referral program is its ability to reach passive job seekers
– individuals who may be open to changing jobs, but aren’t necessarily actively browsing job
postings or searching for opportunities on their own. Since they’re typically satisfied with
their current jobs, getting a passive job seekers’ attention can be extremely difficult. When
the suggestion is coming from a friend or family member, however, they’re much more likely
to take notice.
Improved Company Culture
 Employees who refer friends and family to open positions at their company are more than
likely pretty happy with the company culture – and they’re likely to reach out to people with
similar values to their own when making referrals. When an employee makes a referral, they
aren’t just endorsing the candidate’s skills and experience – they’re also saying this is
someone they wouldn’t mind seeing and working with on a daily basis.
Better Employee Engagement
Employees like being involved in making decisions that will have an impact on themselves
and the company. The very opportunity to influence the makeup and direction of a team by
referring candidates can often increase workers’ happiness and level of engagement. It gives
them a sense that they’re involved in the business beyond the standard contributions
associated with their position, and it makes them feel like they have more of a stake in the
company’s future.

16. Describe briefly the steps involved in designing and executing a sales training programme.
(5)

Ans. Steps of Effective Sales Training Programs

1. Evaluation
To design an effective sales training program, you need to know three things: where your
team is now, where you want it to be and how you are going to bridge the gap. To obtain
that knowledge, start with an accurate assessment of your current reality.
The evaluation phase should include self-assessment by the participants; a 360-degree
assessment by peers, managers, subordinates and clients; and an objective assessment by a
third party or online evaluation tool. Once you have an accurate picture of your team, you
can begin to benchmark it against top performers and ideal behaviors.
2. Impact Training
The next phase is quick-hitting impact training for immediate awareness and baseline
knowledge. Typically, this phase is a boot camp-style training in which you can bring
everyone onto the same page very quickly. Depending on your situation, it can be a virtual;
live, instructor-led; or recorded online course.
The goals are the same regardless of format. You will want to make your team aware of
what is expected of them and to build the foundations of knowledge that will help them
learn and execute the new behavior. Impact training is great for short-term motivation,
building consensus, and communicating best practices and processes. It normally takes place
during the first 60 to 90 days of the training program.
3. Reinforcement
Impact training rarely creates lasting success without reinforcement. It is now time for your
participants to apply the strategy and tactics discussed in the impact phase and challenge
their current status quo. This phase is the most crucial; it’s where the participants must
reach outside of their comfort zones to try something different and then apply it until it
becomes a new habit.
The reinforcement phase also usually requires some live coaching, because participants will
have questions and challenges as they implement skills for the first time. Reinforcement is
the key to any training’s long-term impact. It is never-ending, because lasting results require
lifelong learning, but a solid reinforcement plan should have curricula spanning 18 months
to three years.
 4. Accountability
The final component involves more coaching than training for participants to move from
application to ownership and mastery. New sales habits are not easy to maintain. Sales
managers, trainers and peer accountability partners play a crucial role in helping the
participants stay on track.
Usually, two or more accountability partners yield the best results. If one partner goes on
vacation, is preoccupied or changes positions, it is easy for accountability sessions to fall
through the cracks. If you design a program with at least two partners for each person, there
is a good chance the participant will stick to the plan.
These partners can meet in person or by phone or web conference; the important part is
maintaining communication and good habits. The accountability phase should begin right
after the impact training and have no end date.
5. Repeating the Cycle
The path to sales mastery never ends, and neither should your sales training. Once you have
completed some version of all four phases, it will be time to start back at evaluation. Take a
look at your progress, set new benchmarks, and critique what is working and what is not.
Then, hold another impact training session to reset expectations and remind the team of its
common goals. Reinforcement and accountability must be ongoing. As you repeat these
phases, remember to create a system of continuous improvement for your training and your
people.

17. What is the difference between a prospect, suspect and sales lead? How the probable
prospects are qualified? (8)

Ans. SUSPECT
A suspect can be anyone in the universe who could perhaps buy your offer. You do not even
know if a suspect is interested to your market. It can be an individual or organization with a
potential need for your service or product.
PROSPECT
A prospect is an individual or organization that is a possible customer to buy your product
and has gone through a qualification process. A prospect who is interested will engage with
you consistently, while a suspect will only engage with you as long as it’s safe. While
suspects are the wider universe of potential customers, prospects are auxiliary along the
pipeline. They have manifested some strong indicators that they are interested to buy the
product and they’re willing to share personal information such as their calling cards.
LEAD
Prospects go to the final level, becoming a capable lead, on their own deal by answering to
your "call to action," such as a free package. Leads are prospects that satisfy your criteria.
They need your product or service. They have the budget to buy it and the right to expend
the budget and get the purchase. A prospect turns into a lead when you have recognized a
potential need. The more urgent the need, the hotter the lead.

A qualified prospect has three things:

 A need. A highly qualified prospect needs your product now or relatively soon. For
example, if you sell widgets with an average lifespan of eight years, a good prospect
 is someone who owns a seven-year-old widget, not someone who bought a new one
last year.
 A sufficient budget. A qualified prospect has the money to buy your product or
service. Don’t waste time pursuing someone who truly can’t afford to buy what you
sell; move on from the company that has already spent its yearly budget.
 The authority to buy. A strong prospect is empowered and prepared to take action.
Moreover, the simpler and more streamlined their decision-making processes, the
better your chances of closing a sale.

18. Explain why sales management is considered as an important function. (8)

Ans.

 Sales maximization. It is not an easy task to get sales maximization. Sales Management
helps the business in fulfill the objective of sales management. In the process of
delegation, the top management fixes the sales volume more specifically on the basis of
market, territory, customer or on any other basis which it want to achieve in a specific
period. The sales executives, during the planning phase, precedes potential, capabilities
of sales force and the middlemen and the like,. Once these goals are finalized, it is up to
sales executives to guide and lead the sales personnel and middlemen to implement the
selling plans and achieve the goals so finalized.
 Profit maximization. From the company point of view, profit maximization is the general
objective of sales Management. Top management is accountable for maximum profit.
But regarding profit maximization, it delegates powers and function to marketing
management, which then delegates it, to sales management with sufficient authority to
achieve this objective.
 Growth and Development.Sales management is influential in the charting course of
future operations. It provides higher management with informed estimates. It provides
facts for making Marketing Decisions and for setting sales and profit goals. It is on sales
management’s appraisal of market opportunities that targets are set for sales volume,
gross margin, and net profit in units of products and in rupees, with benchmarks of
growth projected for sales and profits at specific future dates. achievement of these
targets are reached depending upon the performance of sales and other marketing
personnel.
 Strong planning. A plan is a blueprint for future action. The success of an action depends
on suitable planning. The sales management formulates concrete, useful and effective
plans, including objectives, forecasting, budgeting strategy, programming and
controlling. The plans should be specific and property classified in relation to time,
objectives and budget.
 Formation of Organization. The sales plan And its projections cannot be Realized unless
they move ahead with sales organization. The term organization has two distinct
meanings.
 Advise to Top Management. Planning of sales activities is not the responsibility of sales
management. sales management is accountable for the actual happening in it’s
department which are to be reported to the top management. sales management
advises on opening and closing of branches. Opening of new branches involve the
 detailed study and sanction for branch location, layout, staff pattern and so on including
the strength and weakness of competitors.
 Important for sales force management. sales management is very important for sale
force management. sales force management is a specialized type of personnel
management.
 Optimum Relationship. The company maximizes its net profits if it obtains an optimum
relationship. Both in its planning and operating roles, sales management aims for an
optimum relationship among the three factors it can directly effect: sales, gross margin
and expenses. Sales Management works with the in charges of production and
advertising to assure that sales volume is sufficient to attain targeted cost of sales the
fourth factor.

19. What are different sales presentation methods and how are they matched to different sales
situation? (8)

Ans. Salespeople use one of the following types of sales presentations:

 Canned Presentation
Canned presentations are those presentations where text of the presentation is
carefully worded, tested and finally written down. Each sales person is expected to
memorize it and strictly follow the contents in the defined order, while making a
presentation.
This presentation method is most commonly used in non-technical product selling,
like, Pharmaceuticals, telephone selling, door to door selling, etc.
The disadvantage of such technique is that the prospect has limited participation. He
might view it, as a high pressure selling and defer taking a purchase decision.

 Planned Presentation
It is, no doubt carefully planned and organized but still it has a personal touch of the
individual making the presentation. In this method, the training department
provides just a format and the individual sales person then writes explanations,
descriptions and illustrations.
The advantage of this presentation method is that it appears more conversational
and less formal, as the sales person is using his own wordings. As a result, in this
presentation method the prospect also gets involved and his doubts and questions
can be carefully handled.

 Audio-Visual Presentation
For such presentation the sales persons heavily depend on the A V aids. These aids
range from charts, slides, video films, prototypes, computer-based presentations to
the use of actual product. In advertising industry, computer software industry, such
presentation methods are used. In these presentations the speaker of the
salesperson takes the back seat and the prospects attention remains centered
around the A V aids.
Such aids are typically used, not only to gain the attention but in the absence of
these it might be difficult to explain or demonstrate.
  Problem Solving Presentation
This is a two-step presentation method. The first stage is to study the individual
prospects needs and the second is suggesting a proposition. Thus, helping the
prospect to solve the problem. Such method is commonly used in insurance sector
where the insurance agent asks the prospect about the requirements and
accordingly, he proposes a specific policy, its advantages and benefits. Similar
methods are also used in management consultancy assignments relating to all
functions or high-tech customized products.

20. What is Sales Planning? How is it different from sales force planning? Explain how a
marketer does sales planning in marketing an industrial product. (8)

Ans. Sales Planning is a key function in the procedure of sales management process. Sales
planning is an effective method that involves sales forecasting, demand management,
setting profit-based sales targets, and the written execution steps of a sales plan. Sales
Planning is the process of organizing activities that are mandatory to achieve business goals.
A sales plan contains a strategic document that figures out your business targets and several
resources. These can be used for some activities which you perform to reach your desired
goal. Sales Planning involves two steps, i.e. formation and maintenance of a particular plan,
in which a salesperson is expected to use his conceptual skills to meet his objective. As such,
planning is an elementary quality of intelligent behaviour.

21. Describe the various sources of salesperson recruitment. Which source do you think is more
justifiable while recruiting in masses. (8)

Ans. [Refer to Q.15]

22. Write the various functions of channel members in a distribution channel. (8)

Ans. Main functions of channel members in channel distribution are

 Risk taking – Assuming the risk connected with carrying out channel work or being a
part of a channel. If the distributor or channel member is buying a product, it does
not sell, or the distributor suffers bad debts or any untoward thing happens, then
these are risks which the channel member has to take and it is the function of
channel member.
 Financing – Most companies deal in advance payments or a credit limit. However, it
is not necessary that the channel member is getting the payments from customers
within that period of time. A company might take advance payment for product X
but maybe that product sold after 40 days. So till 40 days, the financial burden of
that product was on the channel member. Channel member should be ready for
such financing.
 Physical distribution of goods – Look at any channel driven company and you will
find that there are different modes to reach the end customer. The company is
responsible for delivering the product to channel member. But it is the function of
 channel members to ensure that the goods are distributed to end customer at the
earliest and in optimum condition.
 Negotiations – All negotiations with the end customers is done by channel members
and the company does not take part. Once a product has been purchased by the
channel member, it belongs to the channel member, and the sale of the same
depends on the channel member as well.
 Inventory management – The distributor or dealer has to match the inventory which
is in demand in the market, and which is in his stock. He should not uselessly order
material which is not being sold in the market because this will block
the dealersinventory and finances.
 Contacts – Maintaining contacts with existing customers as well establishing
contacts with potential customers and sharing the same with the company is the
work of channel dealers. Good companies also enable their dealers to maintain
a CRM and use it for better customer retention.
 Promotions -Promotions are not only done at the company level or brand level, but
they are done quite a bit on the channel level as well. Whenever a dealer or
distributor wants to create more brand awareness and let customers know about
the buying point for the brand, at that time he uses marketing and promotions to
attract customers to him. This is in fact an inherent function of channel members –
to increase sales in their locality.
 Information – Gathering information about potential customers, competition as well
as tracking the environmental factors is a function of channel member. He is
intricately involved in making marketing strategies for the company, because
without information from the channel member, the company cannot move in the
right direction.

23. Explain the activities a salesperson needs to do in pre-approach stage in personal selling. (8)

Ans. Activities a salesperson needs to do in pre-approach stage in personal selling are:

 Provide qualifying information

 Design effective approach strategy
 Planning of information
 Try to avoid serious errors
 Build confidence

24. What functions do sales quotas perform and why are they so important to a firm? (8)

Ans. Functions of sales quota:

o To provide objective and incentives for the sales force: Quotas provide vendors,
distribution points and others involved in the sale of the activities, objectives and
incentives to achieve certain level of performance. Many companies use quotas to
provide their salesforce incentives of increased remuneration as commissions or
bonuses if the quota is exceeded and / or recognized for superior performance.
 Needless to say that to be true motivators, sales quotas must be seen to be realistic
and achievable and in a surpassable measure.
o To monitor the activities of sellers: Quotas offer the ability to direct and control the
sales activities of the sellers. Sellers are responsible for certain activities such
customer calls daily, calling for new accounts, which gives a minimum number of
events and realization of the enterprise. If the sellers fail to meet these quotas, the
company can take corrective action to remedy the error.
o To assess the productivity of sales people: Quotas provide a stick yard to measure
the overall effectiveness of sales representatives. By comparing actual results with
SELLERS quotas areas of activity are determined where the sales force need help to
improve productivity.
o To control the selling: Quotas are also designed to keep selling expenses within
limits. Some companies reimburse costs to sell only to a certain sales quota
percentage. Other expenses bind to the seller of remuneration to limit unnecessary
expenses. spending quota helps companies define profit quotas.
o To make effective compensation plan: Quotas play an important role in the
company’s sales compensation plan. Some Indian companies follow the practice that
their sellers receive a commission only when they exceed their allocated quotas.
Companies can also use quota attainment in whole or in part as the basis for
calculating the premium. If the seller fails to minimum
desired quota, it will not be allowed for any bonus.
o To evaluate the results of sales contest: sales quotas are frequently used in
conjunction with sales contests. Companies use most of the time “performance
against quota” as the main base giving rewards in sales contests. sales contests are
more powerful incentives if all participants feel they have a chance to win prizes
based on the quota realization percentage which is more or less equally common
denominator. Therefore, it causes average seller to turn into an average return
above.
o To provide standards for evaluating performance: Quotas provide a way to
determine which sales people, territory, other units of the sales organization, or
distribution points are on average lower than average or above average work. They
are measures to measure sales performance. The comparisons with quota sales
performance identify weak and strong points, but management must dig deeper to
discover the reasons for variations.

Importance of Sales Quota for a firm:

Not only do sales quotas play an important role in sales forecasting and monitoring
rep activity, they also set expectations and motivate sales reps to hit a given level of
activity.
Managers can also use sales quotas to learn more about their team’s productivity,
success rate, and optimal sales processes.

Setting sales quotas allows you to:

 Ensure compensation plans (including commissions) are fair and effective
 Reveal weaknesses or bottlenecks in the sales pipeline
 Highlight successful reps and replicate their sales techniques
 Monitor and regulate selling expenses
  Create achievable goals and benchmarks

25. Why training is important in Sales Management? Write the various objectives of training.

Ans. Sales management training programs empower managers to oversee operations in a

way that unifies your team and makes every member more successful. Programs on sales
management training will help your managers:
 Delegate tasks and assignments based on individual strengths
 Determine team weaknesses and get to the source of problems
 Implement creative solutions that will help each team member thrive
 Embrace an attitude of responsibility and accountability for the team’s successes and
failures
 Set individual goals for each salesperson, as well as overall goals for the team
 Improve the team’s sales negotiation skills
Sales management training programs have a trickle-down effect on the overall growth of
your company. When sales managers are given the tools and skills needed to lead their sales
team through sales management training, that sales team is given the support they need to
confidently qualify leads, convert those leads into customers and keep those customers.
Beyond sales management training, programs on sales management take a bird’s eye view
of the entire sales process. Sales Managers learn how to become teachers and leaders
within their company. Not only do they share effective sales strategies with their team
members; they help the sales team function as a comprehensive unit that is better equipped
to increase company-wide sales.

Objectives of Sales Training:

o To explain the sales people about basic principles of salesmanship.

o To provide information about market territories and customers.
o To tell them regarding the company’s policies, objectives, reputation,
strategies, problems and prospects, etc.
o To inform them about products of the company.
o To explain them about their duties, types of tasks, authority, and
restrictions.
o To provide salesmen the complete details about company’s competitors.
o To teach them how to report, how work with colleagues, and how to behave
with superiors.
o To teach them effective techniques to contact customers, make effective
sales presentation, convince customers, get orders, and to handle their
complaints and objections.
o To make them aware of themselves.
o To change or modify their attitudes, and remove prejudices and wrong
beliefs.
o To motivate them for maximum efforts and build high morale.
26. Write the advantages and disadvantages of “on the job” training over in-house training.

Ans. Advantages of On Job Training:

1. The simple method of learning:

Are you confused once you join a project after classroom training? Have they assigned you a
different task or expectations to what you were trained to do? It is easier to learn when you
can see how a project is being executed.
It is the most practical way to learn and even faster to understand the methodology adopted
by the team and how they function. It ensures that you know in and out of the project by
being the shadow of an experienced person for a while.
2. An economical way of learning:
Is your company spending a lot of classroom training? Is the classroom training helping you
achieve your goals with the new trainees joining your project? If your answer is no then your
solution is the on the job training.
There is no training needs attached to the on the job training. You don’t need lecturers from
outside or a classroom to train your new trainers or staff. All you need to do is assign them a
project and a colleague who can show them what they need to do and how.
3. Get the feel right:
You get to train in the actual set up of your work, giving you the feel of the working style
right from day one. There are no surprises or changes from what you are trained to what
you have to actually do. It is all the same and consistent giving you the confidence of
performing the job well.
You don’t have to get nervous on the fact that you are assigned for a task that you were not
trained to do or your environment is completely different from what was explained to you.
Whatever you see while training is what you get.
4. Immediate productivity:
Every company wants to get their new trainers onboard as soon as possible rather than
waste their resources on the bench. Be it on project or not they will have to pay them the
salary. You are going to work within the team as a team member ensuring that some of the
responsibilities will be assigned to you from day one. This will give assurance to the company
that their resources are being used right from the day that they are appointed and hence
making sure that immediate productivity is achieved and then there is no bench time.
5. Quick learning:
You get trained in a classroom using a mock-up workstation and when you arrive at the
actual workplace you find that it is nothing like you have been trained to do! You are
surprised and confused and hence, your productivity takes a hit as you would have to
understand the whole process again. Whereas on the job training, helps you learn quickly by
being the part of the execution and hence no extra time is wasted in understanding how the
system works.
6. It is systematic:
A systematic way of learning is far more effective than a random way of learning. You have a
stepwise training program when it comes to on the job training as your superior will be
performing the task and you will be his or her shadow. This way you would be clear on the
stepwise execution of your task giving you the chance to learn systematically and helping
you understand whether there can be any improvement in getting the work done faster and
quicker.
 Disadvantages of On Job Training:

1. Teaching is a skill that everyone does not possess:

Teaching is a skill and there are trainers who are appointed to train for the same. You can’t
pick up anyone in your project and ask them to train the new trainee. Not everyone can
explain the job better as you need to have clear communication, patience to hear the
questions and skills to answer them. You need to have skilled trainers who can ensure that
the training given is effective and is not a waste of time.
2. It is a rushed process:
Every employer wants to have his or her new trainee on the job as soon as possible so that
you can ensure the resources is utilized to the fullest. There is a higher probability of rushing
through the process of training, creating a lot of doubts and confusion right from the day
one.
Rushing into the training process to complete it as soon as possible can lead to new mistakes
and less efficient trainee. Every process has its own time and hence you should not rush into
completing the training as soon as possible as it can lead to a bad outcome.
3. Low productivity:
You are asking the trainees to join the project and learn the process while doing a project.
This can cost you a lot of time to execute a task as it would be explaining each and every
step of the task before hitting the green button.
You might end up wasting your time as well as the time of the trainee at the cost of your
project. This will take a hit on the productivity of your ongoing project which can lead you
too late delivery costing you a bad review on the job satisfaction.
4. Creates Disturbance:
With new trainees crawling into the actual workplace can lead to a lot of disturbances within
the team. The discussions between the supervisors and trainees can lead to unnecessary
disturbances for the co-workers hitting on their concentration at work. You might end up
poking them at the wrong time for giving information to the new trainees costing them their
valuable time.
5. Accidents can happen:
This happens very likely in the manufacturing industry where you are dealing with
machinery. If the trainers are involved in the production process directly and have no
experience then the probability of having an accident is very high.
You need to have the right knowledge of the machinery to avoid workplace accidents and
the material used before you jump into the production environment.
On the job training helps the company to save costs on training by saving on time, space and
trainers but it also comes with a price. There are pros and cons to the process and you need
to analyze what fits your organization or project best.

27. Write why should the performance of salesperson be evaluated. Explain the techniques sales
manager use to evaluate the performance of salesperson. (8)

Ans. Evaluating performance of Salesperson by Sales Target

The organization sets sales. target for each salesman that he has to attain. Such targets may
be set either on the basis of units to be sold or based on the value of sales. However, while
setting the target it is important to consider the following points:
 Methods of Evaluating performance of Salesperson
1. The target for sales must not be impossible to attain.
2. It must be reasonable.
3. It must be set taking into account the past records, market potentials, etc.
4. Sales target must not be rigid.
5. The incentives to be given to the salesmen shall be linked to the targets.

Evaluating performance of Salesperson by Sales Territory

A sales territory is a small segment of the entire market for a product or service. Each
salesman is usually made in charge of a particular area or territory. For the trend in sales in
each such area, the salesman concerned becomes accountable.
Thus, sales territory enables the business to not only evaluate the performance of the
salesman but also to know the sales trend.

Evaluating performance of Salesperson by Sales report

Salesmen are duty bound to prepare reports on the progress of their work and forward the
same to their organization for necessary action. As the salesmen are the persons who know
the dealers, buyers and competitors in each area, they are expected to send periodical
reports to their office at regular intervals.

28. Under what circumstances a private warehouse is a better choice for the marketer?

Ans. A private warehouse facility is owned and managed by the same enterprise that owns
the merchandise handled and stored at the facility.
A public warehouse, in contrast, is operated as an independent business offering a range of
services, such as storage, handling, and transportation-on the basis of a fixed or variable fee.
The major benefits of private warehousing include control, flexibility, cost, and other
intangible benefits.
Private warehouses provide more control since the enterprise has absolute decision-making
authority over all activities and priorities in the facility.

The benefits of private warehousing are:

1. Private warehousing offers better monitoring systems over the handling and storage of
products as required by the management from time to time which would enhance the
performance of the warehouse.
2. There is less likelihood or error in the case of private warehousing since the company’s
products are handled by its own employees who are able to identify the products of their
own company.
3. If there is sufficient volume of goods to be warehoused, the cost of private warehousing
comparatively less than that of public warehousing. The cost of private warehousing per unit
may be actually higher if the private warehouse is packed to the brim.
4. Private warehousing is the best choice for some of the locations and the products handled
because of the non-availability of the public warehousing.
5. Private warehousing has the opportunity to specially design its facilities for automatic
material handling equipment whereas public warehousing may have the same.
 6. Enabling the end user to increase their efficiency by means of better design and
structured lay-out.
7. efficient use of human resources in warehouse operation improves end users’ overall
performance
8. Intangible benefits in the form of cost reduction in all the warehouse operations.

29. Short Notes:

 Sales Quota: Any kind of sales figures given to any particular person or region or
distributor is called Sales Quota. It can be measured either in terms money or the
stock of goods sold. It is particularly an amount of target sales that is assessed on
daily or monthly basis. To assess the performance of an individual sales person,
his/her ability is looked to meet the given target.
Types of Sales Quotas: This can include many things from cold calling, Marketing
emails, advertisements, invitation to executives for events and many more things.
It’s always in the interest of the sales team as to how they should get the stuff out.
1. Sales volume quota: This always includes sales in monetary terms or units sold for
a specific period of time. This type of sales quotas is always set for a given year. The
sales teams are then assigned their yearly quotas to be accomplished. These quotas
are set in the areas mentioned below:
(i). Product line
(ii). Product range
(iii). Branch offices
(iv). Individual sales person
2. Profit quotas: This type of quotas is very useful for FMCG companies as various
products add to varying levels of profits. The advantage of this type of sales quota is
that the sales person can use his time optimally. Hence he/she can strike a balance
between high and low profit yielding products.
3. Expense Quotas: These are linked to selling costs with a realistic time frame. Few
companies set quotas for expenses to different sales levels achieved by the sales
person. The sales team may be given an expense budget which is a percentage of a
particular region’s sales volume. He/She should spend only that sum as expenses.
4. Activity Quotas: Under such quotas the sales team is required to execute other
activities that will have a long term bearing on the company’s goodwill. Here certain
objectives related to the job are set in attaining the performance targets of the sales
force. When it comes to the Indian companies we have few common types of these
quotas as mentioned below:
(i). Quantity of sales presentation made
(ii). Amount of calls made
(iii). Number of dealer visits
(iv). Recovery calls made
(v). New clients procured

 Sales Forecasting: Sales forecasting is the process of estimating future sales.

Accurate sales forecasts enable companies to make informed business decisions and
 predict short-term and long-term performance. Companies can base their forecasts
on past sales data, industry-wide comparisons, and economic trends.
It is easier for established companies to predict future sales based on years of
past business data. Newly founded companies have to base their forecasts on less-
verified information, such as market research and competitive intelligence to
forecast their future business.
Sales forecasting gives insight into how a company should manage its workforce,
cash flow, and resources. In addition to helping a company allocate its internal
resources effectively, predictive sales data is important for businesses when looking
to acquire investment capital.
Sales forecasting allows companies to:
(i) Predict achievable sales revenue;
(ii) Efficiently allocate resources;
(iii) Plan for future growth.

 Territory Management: Territory management is an account sharing system that

grants access to accounts based on the characteristics of the accounts. It enables
your company to structure your Salesforce data and users the same way you
structure your sales territories.

Particularly if your organization has a private sharing model, you may need to grant
users access to accounts based on criteria such as postal code, industry, revenue, or
a custom field that is relevant to your business. You may also need to generate
forecasts for these diverse categories of accounts. Territory management solves
these business needs and provides a powerful solution for structuring your users,
accounts, and their associated contacts, opportunities, and cases.

Key benefits of territory management include:

i. The ability to use account criteria to expand a private

sharing model.
ii. Support for complex and frequently changed sales
organization structures.
iii. Support for transferring users between territories, with the
option to retain opportunities.
iv. Multiple forecasts per user, based on territory membership.
v. Territory-based sales reports.

 Tele Marketing: Telemarketing is a very common form of marketing companies use

to connect with potential customers of their products or services. Historically,
telemarketing consisted of companies making telephone calls to existing or potential
customers. With new technology, telemarketing has expanded to include video
 conferencing calls as well, although those are typically conducted with existing
customers. Telemarketing is often used to try to sell a product or service, but it can
also take the form of surveys or information gathering. For instance, political
campaigns use telemarketing heavily prior to elections to inquire about voting
preferences.
When companies call new customers, the activity is referred to as cold calling. This
means the consumer has not purchased from the company before nor have they
requested a call from the company. Companies can buy a list of potential customers
to call from a list service, which will provide a list of consumers who have similar
interests or purchasing histories who fit the company's target market.
There are many industries that rely heavily on telemarketing, such as:
i. Cable and Internet services
ii. Home security systems
iii. Financial services
iv. Vacation and time share
v. Charitable organizations

30. Different types of selling. (2)

Ans. Different types of selling are:

1. AGGRESSIVE SELLING

In this style, the only intention of the seller is to sell. Salesmen who have an aggressive style
of selling believes in getting the job done in one shot. They don’t follow any so-called sales
process. They also believe that if the client leaves, the sale is lost. Such representatives are
best suited to work individually as their harsh methods don’t go well while working in teams.

2. CONSULTATIVE SELLING

Consultative selling is based on the development of trust between seller and customer. A
sales representative with such style will try to build a relationship of trust with the customer.
Under this method, the focus is not on anyhow selling the product but is to build a
relationship and that’s why this type is also known as relationship building selling. The
salesman needs to have a good personality, complete knowledge of the product and
experience as these things will help him to create his credibility. Salesmen under this type of
selling believe that sales are not a one-time thing.

3. NEED ORIENTED SELLING

As mentioned above, a seller has to be smart enough to observe the actions and words of
the consumer. Under this style, a sales representative observes the customer properly. He
will ask different questions and figure out what the customer requires. He has to be smart
enough to present a solution to the problems of the clients immediately. Salesmen under
 this style are fast and clever and this style of selling is also known as the problem-solving
style of selling.

4. PRODUCT-ORIENTED SELLING

As the name suggests, this style of selling is totally based on the product. The salesperson
will describe all the features and benefits that the product possess till the customer is fully
convinced with the product. Lots of demos of the products are given to prove its effective
utility. Sales representative need to be fully aware of the features, benefits, and usefulness
of the product in order to follow this style of selling.

5. COMPETITION-ORIENTED SELLING

Sales representatives under this style of selling believe in being one step ahead of the
competition. They never take a no for an answer and always believes in convincing the
customer to buy the product. They are always ready to go an extra mile if it takes to close
the sale so that they are on top of the competition charts. Personal interfaces with the
buyers or calls, they don’t leave any option unused in order to get the job done.

So these were few the types of selling styles which different salespersons follow. It is not
mandatory that a salesperson has to follow one particular style of selling, he can give tries to
all these styles based on the customer’s personality. At the end what matters is the
completion of the job and by completion of the job, it means selling the product.

31. Process of effective selling. (2)

Ans. The process of effective selling is:

 (i) Pre-Sale Preparations: A salesman has to serve the customer and must identify a
customer’s problems and prescribe a suitable solution. For this, a salesman must be
familiar with the product characteristics, the market, the organization and the
techniques of selling. Also, he must know the customer, himself and the company.
He must know buying motives and buying behavior of the customers or prospects.
He should be aware of current competition and market environment.
 (ii) Prospecting: A salesman has to seek potential customers who are his prospects
i.e., probable buyers. A prospect has unsatisfied need, ability to buy and willingness
to buy. Prospecting relates to locating prospects. They can be through present
customers, other salesman, phone directories, or by direct cold canvassing. These
prospects must, of course, be accessible to salesman. Thus, prospecting is similar to
the seeking function for the total marketing activities.
 (iii) Pre-Approach: After locating a prospect, salesman should find out his needs and
problems, his preferences and behavior etc. The product may have to be tailored to
the specific requirement of customer. On the basis of adequate information of the
customer’s wants and desires, salesman can prepare his plan of sales presentation
or interview. The sales presentation should match to the needs of the individual
prospect. It should enable the salesman to handle his prospect smoothly through
the buying process, i.e., during, the sales talk.
  (iv) Approach: The next step is approach where the salesman comes face to face
with the prospect. The approach has two parts, i.e., obtaining an interview, the first
contact. He may use for this, telephone, reference or an introduction from another
customer; and his business card. The salesman must be able to attract the
prospect’s attention and get him interested in the product. It is very important to
avoid being dismissed before he is able to present his product.
 (v) Sales Presentation: After the salesman has found a prospect and he has matched
the customer’s wants with his product, he becomes ready to make a sales
presentation. The sales presentations is closely related to the buying process of
customers. The sales interview should generally go according to AIDA theory (i.e.,
Attention, Interest, Desire and Action). Attention is attracted and interest is gained.
The salesman at this point can increase the interest through smart and lively sales
talk together with proper demonstration. Sometimes, visual aids are used in sales
demonstration. These are common for capital goods or machineries. After
explaining the product characteristics and expected benefits, the salesman should
find out customer’s reactions. The prospective customer’s all queries and doubts
must be clearly answered. The salesman should find the customer satisfied. A
satisfied sales presentation must be clear, complete, assertive about product’s
superior performance and be able to gain the confidence of the prospect.
 (vi) Objections: At any stage of sales interview, the prospect may attempt to
postpone the purchase or resist purchase. A good salesman must consider an
objection as an indication of how the prospect’s mind is working. The clever
salesman should welcome an objection, interpret it correctly and will avoid it
tactfully, without arguing with the customer.
 (vii) Close: The close is the act of actually getting the prospects’ consent to buy. It is
culmination of the efforts so far made by the salesman and is the climax of the
entire sales process. It is very important for salesman to be alert and find out the
right moment for closing the deal. This is the “Psychological or reaction movement”,
at which the minds of salesman and prospect are tuned together. The salesman
watches every sign of prospect willing to buy and shall apply “the close”. A sale is
never complete until the product is finally in the hands of a satisfied customer.
 (viii) The Follow-up: This stage is the post-sale contacts. The salesman after
obtaining the order, arranges for dispatch and delivery of the product, facilitate
grant of credit, reassure the customer on the wisdom of his purchase decision, and
minimize dissatisfaction, if any. The salesman should contact the customer
periodically to maintain his goodwill. A sale is made not in the mind of salesman, nor
over the counter, but in the mind of the buyer. A salesman should have the quality
of empathy, i.e., reading customer’s mind. This will provide the salesman accurate
information of buyer’s motives, feelings, emotions, and attitude etc.

32. State the AIDA Model with help of a diagram.

Ans. The AIDA Model, which stands for Attention, Interest, Desire, and Action model, is an
advertising effect model that identifies the stages that an individual goes during the process
of purchasing a product or service. The AIDA model is commonly used in digital marketing,
sales strategies, and public relations campaigns.
 The steps involved in an AIDA model are:
 Attention: The first step in marketing or advertising is to consider how to attract the
attention of consumers.
 Interest: Once the consumer is aware that the product or service exists, the business must
work on increasing the potential customer’s interest level.
For example, Disney boosts interest in upcoming tours by announcing stars who will be
performing on the tours.
 Desire: After the consumer is interested in the product or service, then the goal is to make
consumers desire it, moving their mindset from “I like it” to “I want it.”
For example, if the Disney stars for the upcoming tour communicate to the target audience
about how great the show is going to be, the audience is more likely to want to go.
 Action: The ultimate goal is to drive the receiver of the marketing campaign to initiate action
and purchase the product or service.

33. What are the various types of distribution channel?

Ans. Various types of distribution channel:

1] Agents

Agents are middlemen who represent the produces to the customer. They are merely an
extension of the company but the company is generally bound by the actions 0of its agents.
One thing to keep in mind, the ownership of the goods does not pass to the agent. They only
work on fees and commissions.

2] Wholesalers
Wholesalers buy the goods from the producers directly. One important characteristic of
wholesalers is that they buy in bulk at a lower rate than retail price. They store and
warehouse huge quantities of the products and sell them to other intermediaries in smaller
quantities for a profit.

Wholesalers generally do not sell to the end consumer directly. They sell to other
middlemen like retailers or distributors.

3] Distributors

Distributors are similar to wholesalers in their function. Except they have a contract to carry
goods from only one producer or company. They do not stock a variety of products from
various brands. They are under contract to deal in particular products of only one parent
company
 4] Retailers

Retailers are basically shop owners. Whether it is your local grocery store or the mall in your
area they are all retailers. The only difference is in their sizes. Retailers will procure the
goods from wholesaler or distributors and sell it to the final consumers. They will sell these
products at a profit margin to their customers.

34. Why market potential analysis is required to be measured by firms before selling? How firms
fix their sales objectives?

Ans.