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Sales Force Organization
2.1 Ways of Organizing Sales Force
Sales force organization can be categorized into four types: Territory-based, Product-based, Customerbased, National account-based and Inside/outside sales-based. Each sales structure is built based on the specialization of the sales force. 1. Territory-based Using this structure, it is easier to manage the sales force due to its simplicity, since there are lesser management levels. It also divides the market into different region, so there is no conflict between the geographical areas for the sales staffs, thus no duplication of customers as well. This prevents the extra effort and time spent on the same customers in the area. The cost of training and managing the staffs is also much lower. However, this sales organization structure has a lack of specialized knowledge on each product the company is selling. Besides that, it is also harder to maintain the relationship with the customers, as there is only one single representative for each area, thus overwhelming workload for the staffs. (Ingram, et al., 2007) 2. Product-based By providing training, sales person become experts in the company’s products, enable them to provide the utmost knowledge of the products to the customers. It is also easier to control the selling effort of the sales force. However, high cost is needed to invest to provide training and maintain the sales force. Besides that, it is possible to duplicate the geographical area and customer within the sales force, lowering the efficiency in searching of potential customers. (Ingram, et al., 2007) 3. Customer-based This organizing method of sales force is to cater to different customer, according to their needs. This allows the sales staffs to have a better understanding of the clients or potential customers, thus providing suitable plans. (Anon., 2010) This is a very efficient method in approaching suitable customers, however training must be provided to the sales staffs to allow in-depth knowledge in the industry, thus higher cost. Besides that, it is possible that multiple staffs will approach the same customers, lowering the efficiency. 4. Inside/outside sales-based Inside/outside sales-based is the most efficient way in performing selling activities, as both groups manage different functions. Inside sales group can use telesales to approach potential customers that are not within the scope of outside sales group, maintaining relationship with existing customer on regular basis, provide information, solving problems, etc. Outside sales group approach new customers, revisit existing customers to maintain the relationship, etc. (Anon., 2010)
However. Incentive and rewards can be given to sales person who achieved its target.. target to be reached should be set different as well. Responsibility of inside sales force is to follow-up and search for new customers outside the area. 2. . this hybrid sales organization structure will maximize its efficiency due to the business nature of CCS. customers based in Midlands. 2000) This will further encourage the sales person. according to the customers’ specific needs. coordination between departments is extremely important to ensure efficiency of decentralization. The new approach to business to business now is collaborative where both company work together for the same objective. both inside and outside sales force have the ability to communicate with the customers. They use business and social relations such as conference and meeting. which is decided by the sales manager. 2010) This is a better choice for CCS in long run. (Anon. Relationship marketing is the interaction and exchanges between working for organizations that are known to each other. They can also cooperation on joint planning and projects. 3. By conducting training for all sales staffs on the knowledge of the industry. through telesales. they create long term relationship unlike the traditional approach. It is true that the structure of business as a network of significant relationships between interdependent companies are important nowadays especially at this current economic climate which poses many challenges for CCS company. and the sellers don’t expect repeat purchase from buyer. As for outside sales force. as the central HQ can share its responsibility with the sales manager to perform the sale activities. However. They exchange ideas depending on the quality of the relationship. their task is to follow-up with existing customers and search for new customers around London and the South East. CCS should also lead their sales force towards decentralization. in this case.1 Key Relationship Variables There are some important variables in business to business relationship that help CCS to go through the next 12 months to retain their customers and at the same time to continue and try to win new business. Importance of Relationships in B2B Peter and Sarah have highlighted the importance of relationship in B2B. even though it is costlier. Companies also need to invest an amount of money to manage the coordination between departments. incorporating both customer-based and inside/outside sales-based into the sales force organization. due to the different nature of outside sales and inside sales.2 Recommendation In my opinion. It is also necessary for the sale force to maintain the relationship with the clients on regular basis and provide after sales service. both groups might approach the same customer. working with outsides sales force to strengthen the relationship with the customers. And of course the relationship is built on trust and commitment. (Nickol. This allows the sales force to provide relevant information. reducing efficiency. 3. However. Besides that.
According to Silva (2010). Peter and Sarah are wary that the company only has a limited number of resources and at this stage it would be unrealistic to look at serving large multi-national companies. they work as a team to reach their goal together. Peter and Sarah are members of a numbers of a number of local business organizations and have developed a high profile in the North London business community. With trust. This requires that the business owner develop and maintain business relationship. Once they agreed to common goal. 3. turnover is up 10% on last year and a number of potentially new clients have expressed great interest in the company’s services. “This construct is central to successful buyer-seller relationships because it enables partners to bring future value. Another important variable is the social bonds. Adaptation is very important as well because it can help CCS to improve from their client’s request for products that adapt to what they need. People are assets. as well as internationalization. trust and co-operation is where the outcomes depend on the behaviour and intend of both parties. The owners of CCS. speed things up with new technology.Therefore. work together to serve buyer needs better. Next. the more advantages they will get. Their used of new technology might come from the expectation of their clients. satisfied performance. sales revenue and so on. comply with a partner's requests and engage in consistent activities. increase supplier sales and buyers orders. commitment. combining social resources to perform exchange activities. it is for the sake of successful long term relationships. act as powerful signals of intended relationship quality and influence the development of shared social norms for regulating future exchanges. many customers will choose over one business or the other because of the person representing that business. And CCS prides itself on its ability to compete with other firms through its excellent customer service. and ability to deliver on clients’ expectations. The last important variable is shared technology. As we can see.2 Business Networks CCS’s owners. . benefits and/or costs reductions to them. the recommendation from CSS’s existing customers can keep on coming. achieve a higher level of performance and view potentially high risk actions as being prudent because of the belief that their partner will not act opportunistically. Mutual goals and value are the variables of relationship as well and are always the most basic for all marketing activities because both parties involved expect to gain value in them such as the profit. The satisfaction construct is also an important role in marketing literature. First. Relationships are built on the foundation of mutual commitment. systems for efficiency.” CCS has a number of clients that have been with the firm since inception and this is undoubtedly due to the trust and commitment that CCS places in its client base. So business networks are very important for CCS’s business to grow wider. To know more people. which the exchange value is created at the social level. CCS also has a good working relationship with Magenta Media Production Ltd that looks set to continue in the short-term. they fulfil the promise that had made to each other and also it leads to smooth transaction. relationship marketing is important for CCS.
as well as new ones being established. CCS gets to know what leads to do business professionally. it’s quite hard for new entrants to compete with them. Supplier power may be strong due to CCS needs to negotiate with individual media owners on availability or media space and price especially on this current economic climate. They talk about what they are feeling in the business world and share a little success help CCS to understand more about business networking that can bring advantage to their business. CCS applies a rigid pricing policy when dealing with its clients. CCS needs to get lower price from those media. efficient and friendly service. At present CCS has a fairly rigid pricing system. it creates camaraderie and gives CCS a support network which it beneficial CCS to meet people who can introduce them to other decision makers. Business network is important for CCS because it generates referrals and increases their exposure to many other people and business. Due to CCS has built a reputation for providing a reliable . CCS put a face to their business and gives their business a presence outside of its physical place.Business networking can generate leads and create professional relationship. As for threats of substitutes. It also allows CCS to meet likeminded professionals and to get to their contacts. . Another move that can CCS take is develop a sales team to retain clients and at the same time attempt to win new business so that CCS can remain competitive during the economic downturn. As a member of few local business organizations. The degree of rivalry will be low because with the business networks and relationship.3 Porter’s Five Forces The theory I use to apply in CCS is Porter’s Five forces. it gives CCS a fresh platform for think widely by sharing best practice. They have found that a simple. 3. In order to make more profit to their company. price performance. At the same time. yet with the relationship marketing which is the relationship and business network. It enables CCS to build a network of referrals and introductions for their clients. So the threat of new entrants is not high for them at all. When it comes to buyer power. this involves switching cost. rigid pricing structure is often preferred by existing and potential clients. By getting to know those professionals. it is low for CCS which is good because the customers cannot set the price. Most importantly. it is important for the other members to trust and know them in a business networking and at the same time grow their business through association with other business owners. rather than promoting a flexible pricing strategy. it helps CCS to involve a great deal of social bonding in the hope that existing relationships can be maintained. the interaction marketing and public relation helps CCS to compete with other firms. They had also developed a high profile in the North London business community.
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