Module II

PLANNING THE SALES TEAM EFFORTS

In this module

Sales organization
Forecasting market demand
Selling process
Sales quotas, objectives & budgeting

Sales organisation
Sales organisation is an
organisation of
salespersons working
together
Simple definition:
A sales organization is an
organizational unit that sells and
distributes products to the channel
partner, negotiates terms of sale
and conducts daily sales operations

for the marketing of

products and services
manufactured by the firm
or
for the products that are
purchased by the firm for
the purpose of reselling.

The largest FMCG sales organization in India

Chakala
Andheri E

R&D Facility

HUL completes
80 years of
corporate
existence in
India on
October 17th,
2013.
The oldest MNC
in India with the
oldest sales
organization in
the FMCG
category.

HUL March 31 2016 results: Rs.32,482.72 crore

HUL has more than 15,000 employees, and

approximately 1,300 of them are
salespeople:
Rs. 25 crore /sales manager/year

Channel
Sales
structure at
HUL
Moves 4
million tons
of stock
each year
are moved
equaling
Rs.32,000
crores in
sales

The youngest FMCG brand in India! A successful Indian

brand extension

The Entrance
of the Patanjali
Yogpeeth in
Haridwar

Patanjali Ayurved was founded in

2006
The Patanjali
Ayurved
factory in
Haridwar

Staff at the
Patanjali Ayurved
fruit juice
packaging unit

Staff at the
Patanjali
Ayurved hair oil
packaging unit

Modern trade presence

of the brand though
unique branding of
retail supermarket
stores and pharmacies

Next
stop:Rs.10,000
crore in net sales
by 31 March 2017
Sales have
multiplied 11-fold
fromRs.446 crore
in 2011-12
His own channel,
Aastha, is a handy
marketing tool
(2000)

Prices are 30 per cent

cheaper than other major
brands such as Dabur
Retailers get a 10-20 per cent
profit margin and for
distributors it is 13-15 per
cent

Sales organization Level I

2016-17
Patanjali will
increase its retail
presence through
4,000
distributors, more
than 10,000
company owned
outlets under
the Swadeshi
Kendra
branding, 100
Patanjali-branded
stores and

Sales Organization Level II:

piggybacking

Kishore
Biyanis
Future
Retail Ltd
for selling
Patanjali
products in
243 cities
across India
Mukesh
Ambanis
retail chain
Reliance
Retail to sell
its products

THE BIG BABA BAZAAR!

The Sales Organization

1. A sales organization is a reporting
structure
designed for sales effectiveness and for
achieving
sales revenue growth by selling all
products in the
brand to consumers in a sales territory.
2. The reporting structure consists of line sales
managers and reportees (sales team of

Sales Organization
4. Sales effectiveness: sales line
managers assign annual sales targets
and collection targets to sales
executives.
5. Sales growth: line managers use
authority and decision making roles to
ensure that all products in the brand
sell in the market by a team of

Types of Sales Organizations

Key account
sales

Line

By
Territory

Organization
al design

Combined
design

By
customer

Managem
ent
Function
By product

Types of Sales Organizations

Line
Sales
Organizations

Line sales organisation

Theline sales
organizationis the
oldest and simplest
sales organizational
structure.
It is widely used in:
Smaller firms
Product division
centric
Small number of
products

Head Marketing

VP (Sales)

Five sales people

The chain of command runs from the President/Owner down through
subordinates.
All executives exercise line authority, and each subordinate is
responsible only to one person on the next higher level.

Vicco Laboratories
Founded in 1952 in Mumbai
Eight products only
Three factories:

Goa Div 1 Powders

Nagpur Div II Creams
Mumbai Div III Exports

Line sales organisation

Line sales
organizatio
n
Vicco
Laboratorie
s

MTR: lines sales

organization

Theline sales
organizationis the oldest
and simplest sales
organizational structure.
It is widely used in:
Smaller firms
Few product division
Small number of products
Firms with small

Line sales organization: MTR

Vice President
Marking
MTR
Head Channel Sales
Consumer
Marketing
National
Distributor
s
Regional
Distribut
ors
Retaile
rs
Consum
ers

Online
resellers

Head Channel Sales

Institutional
Marketing

MTR
outlets

Distribut
ors

Manager
Corporate
Marketing
Bundlin
g
Consum
er

Gifting

Line Sales
Organizations

16 assembly lines for mobile handsets Production capacity of close to 2

Million per month.
The factory assembles over 30 Micromax mobile phone models of most
of which are smartphones
LCD, LED devices (TVs and Lights), Tabelets and Dongles, Laptops
Micromax Factory: Rudrapur, Uttarakhand

Alpha and Canvass

Micromax: Line organization Level I Consumer

Marketing

Micromax : Line organization Level II Business Marketing

Line sales organization:

Micromax
Vice President
Marketing
Micromax

Head Channel Sales

Consumer
Marketing
National
Distributors
Regional
Distributor
s
Retailers
Consumer
s

Online
resellers

Head Channel Sales

Corporate
Sales
Micromax
outlets

Distributor
s

Types of Sales Organizations

By
Territory
Sales
Organizations

Design by territory

Territory/Geographic Sales
Organization
National Sales
Manager

Sales Training
Manager

Eastern Region Sales

Manager

Western Region Sales

Manager

Zone Sales Managers (4)

Zone Sales Managers (4)

District Sales Managers (20)

District Sales Managers (20)

Salespeople (100)

Salespeople (100)

Example: Britannia Industries

Varun Berry, MD Britannia Industries

Sales organization by territory: Britannia Biscuit Sales

Team

Territory based Sales Structure of

Britannia

Nestle India

Geographic Sales Organization:

Nestle India

Types of Sales Organizations

Sales
Organizatio
n Design

Managem
ent
Function

Sales organization by Management

Function

1. A sales organization by
management function is called a
line and staff sales organization

1. Line Authority means that a

manager has formal authority to
direct and control immediate
subordinate-level managers
2. Staff Authority is narrower and
includes the right of subordinate
level managers to advise,
recommend and motivate junior

1. The line-and-staff sales

organization combines the line
organization with staff
departments that report to,
support and advise line
departments
2. Most medium and large-sized
firms are line-and-staff sales

Types of Sales Organizations

Sales
Organizations

By
product

Product Sales
Organization
1. A product/product division sales
organization is a sales reporting
structure where the line authority
is given to a (General) Sales
Manager.
2. The staff authority is given to
the sales manager or product

Can you guess the name of

the largest Product Sales
Organization in India?

1. Godrej Group has 25 product divisions selling

different brands.
2. Godrej is a typical product sales organization
where product/sales divisions are headed by a
General Manager/National Sales Manager.

Product Sales Structure at Godrej

Restructured Product Sales

Organization at Godrej

Types of Sales Organizations

Sales
Organizations

By
customer

A customer sales
organization is sales
reporting structure where
sales managers sell the
entire range of products of
the firm to three types of
B2B customers: industrial

Customer Sales Organization

Kyocera India Sales
Organization

Xerox India Sales

Organization

Ceat; MRF; St. Gobain; Purolator; 3M;

Henkel; Exide; Sona Steering;
Sundaram Fasteners and so on

Types of Sales Organizations

Organization
al design

Combined
design

Combined Sales
Organization
A sales reporting structure is a
combination of product, function,
geography, or the customer levels.
Widely used to ensure sales
effectiveness across a global
market by companies with

Combined sales
organization
The combined sales organization
reporting structure is wide used
by:
Companies with large global
trading and distribution
operations (India)
Japanese companies

Examples: Tata International

ITC International
Dabur International

ITC Agri Business Offering India's finest AgriProduce to the

world

ITC Agri Business Wheat,Rice,Soya,Coffee,Shrimps,Processed

Fruits,Pulses,Barley,Maizeand Wheat Flour (Maida) to over 100
countries

Combined Sales
Organization

Key Account based Sales

Organizations

Key Accounts

Sales

Ferrero
Roche
CISCO

IBM
R&D

Products

AMAZON

GOOGLE
Finance

Airtel

Maintaina
nce

Service

Solutions

SODEXO

Characteristics and benefits

Key accounts are
businesses which
contribute heavily to an
organisations profitability
and value
Customers who qualify for
a Key Account are those
who purchase a significant
volume.

Key Accounts include

business vendors,
suppliers, and channel
partners: C&F agents,
distributors, advertising
agencies, trade show
organizations

ITC Key Accounts

In this module

Sales organization

Forecasting market demand

Selling process
Sales quotas, objectives & budgeting

FORECASTING MARKET DEMAND

Sales Forecasting Methods

Qualitative
methods

Quantitative
methods

Experts
opinion

Delphi
technique

Test
marketing

Nave
method

Survey of
buyers
expectations

Sales force
composite

Trend method

Moving
average

Regression
method

Exponential
smoothening

Historical
analogy

Sales Forecasting Methods

Quantitative
methods
Test
marketing

Nave
method

Trend method

Moving
average

Regression
method

Exponential
smoothening

In this module

Sales organization

Forecasting market demand

Selling process
Sales quotas, objectives & budgeting

SELLING PROCESS

Identifies and locates the

prospects
Separates the prospects from
the suspects

The selling process is a

process by which the
salesperson :

Approaches them and makes a

sales presentation
Handles their objections or
queries
Closes the sale

Follow-up with existing

customers for sales leads

The selling process also

includes

Measuring the success and

customer satisfaction levels of
current product and service
offerings

90
%
Focus on
customer
handling
strategy

10
%

Focus on sales
presentation

In this module

Sales organization

Forecasting market demand

Selling process
Sales quotas, objectives & budgeting

SALES OBJECTIVES, QUOTAS, &

BUDGETING

Objectives
Objectives are essential for a sales
manager. Based on the objectives a
sales manager can make fact-based
judgements about the performance of
salespeople in his organisation

Sales Quotas
Sales Quota (SQ) or sales
targets are the targets that
salesperson tries to
achieve within a specific
period of time.

Sales quotas contributes

towards achieving the
organisational goals
regarding sales forecasts

Quota Setting Procedure

Quota Setting Procedure

Schedule
planning
Goal setting meetings
for individual SPs.
Meetings essential to
explain targets,
systems, benefits and
incentives for the
individual and goals of
the organisation
One-on-one
meetings
but a two-way process.
Goals for each SP
finalised in the
meeting.

Conferenci
ng
SP brings individually
filled Goal setting
form.
The focus of the call is
built around : territory,
account, call
management and self
management.
All 3 classes of
objectives are also
discussed in the
meeting.

Written
quota
statements

A written summary
of the goals agreed
upon, in the
conference is
prepared.
Serves as a guide
for the SP and the
SM, by enunciating
clear-cut goals and
responsibilities for
the year ahead.

Types of Sales Quotas

Sales
Volume
Quota

Sales
Activity
Quota

Sales
Budget
Quota

Combined
Quota

Sales Volume Quota

Defines an
organisations
expectations in terms of
what amount of sales
for/in what period
Set for a year and can
be broken smaller time
lots; quarters, months
and weeks.

Monetary Sales Volume

Quota
Unit Sales Volume Quota
Point Sales Volume Quota

Sales Budget Quotas

The intention of setting
SBQs is to inform the SP
that their role includes
not just driving
volumes, but also
driving good profits
SBQs are devised to
control expenses
(expense quota), gross
margins and net profits
(profit quotas).

Cost of customer
acquisition should be
lower than revenue
generated from these
customers

Sales Activity Quota

Since the activity
performed by a SP has an
influence on the sales of an
organisation, quotas are
fixed on a activity a SP has
to perform rather than the
final
outcome
In addition
to direct sales
calls, the SP is expected to
perform non selling activity
and quotas can be set for
both these activities

Activity quota can be set

on total sales calls, types
of customers met, calls on
prospects, number of new
accounts won, product
demonstration, field
activity etc.

Combined Quota
Many organisations use a
combination quotas. The
most popular, is a
combination of sales
volume and activity
quota.
Combination quotas
leveraged to control SP
performance on the basis
of selling and
nonselling activities.

A typical combination
quota would include:

Sales of 1000 units

Developing 20 new key
accounts
Identifying 100 new
prospects
And renewing
relationships with 50 lost
customers

Setting Sales Quotas

Quotas based on
sales forecasts
and potentials

Quotas based on
forecasts

Quotas are commonly set on the basis

of sales forecasts and sales potential of
a territory
Orgs. determine total sales which in
turn is divided into territories and to a
SP level
In the absence of forecast figures,
quota can also be set on the basis of
past performance
Here, past performance is a benchmark
to set quota for an area and not the
sales potential

END OF MODULE