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y Sales organization are structural entities which
execute a combined sales plan and are designed to carry out mutually agreed business goals. y A sales organization is built within a larger corporate organization to achieve corporate and departmental goals. y It consist of a group of individuals working in organization with a sales function orientation for achieving both quantitative and qualitative goals .
y A sales organization defines the duties. .Sales organization of individuals either working organization y A sales together for the marketing of products and services manufactured by an enterprise or for products that are procured by the firm for the purpose of reselling. roles. y A sales organization undertakes managerial functions like the selection and recruitment of quality manpower. and rights and responsibilities of sales people engaged in selling activities meant for the effective execution of sales function. y A sales organization is a structural body through which the functions of sales management are carried out.
Factors influencing structure y Product and services related factors y Organization related factors y Marketing mix related factors y External factors .
y Closer customer relationship y Changes in regulations and international practices .Changes in structure y Product are turning into commodities into many mature markets y Shift in market covering strategy y Shaping the nature of sales organisation y Reduction in number of vendors per buyer.
y Flow of communication. y Serving customers effectively. y Different structures based on different parameters. . y Enhance productivity and quality. y Should be flexible .y Formal and coordinated task of assigning.
y Small firms have this structure. y Less time for planning. y Single chain of command. . y Decisions are faster.LINE ORGANIZATION y Single decision making authority.
y Sales force remain close to the customer. y Varied marketing strategy can be developed. .ORGANIZATIONAL DESIGN BY TERRITORY y Simplest method of designing. y New product demand and modifications can be identified. y Customer servicing is better. y Several areas are combined together.
y Conflict in resource allocation. y Brands get commoditized. y Tendency to become order takers. y Some products are easy to sell. y It is often costly. y Suitable for markets with extensive territories. .CONTD. others get marginalized.
y Used by firms having similar product lines .DESIGN BY MANAGEMENT FUNCTION y Grouping of sales task according to their characteristics.recommend and counsel. y Staff authority-advise. y Line authority-authorized to direct and control.
y Sales and planning are handled independently. y Final delivery of service is slowed. y Multiple chain of command. of departments can vary.CONTD. y Helps in achieving specialization. y No. . y This design is less expensive. y Interdepartmental rivalry and non-cooperation.
y Interference of other functions is avoided. y Duplication of efforts.DESIGN BY PRODUCT y Used by firms with diversified product range. . y Salesmen specialize in specific product. y Customer is highly satisfied. y Necessary when product is highly technical. y Operational costs are high. y Expensive design.
y Design helps building long term customer relationship y Expensive and duplication of efforts. y Design is customer driven. y Salespeople gain more knowledge.DESIGN BY CUSTOMER y Suitable for firms with several distinct markets. y Helps in integration and loyalty and create multiple linkage. .
COMBINED ORGANIZATIONAL DESIGN y Large organizations offering complex products. y Combination of different level of hierarchy. . y Essential to get specialization at every stage of marketing activity.
which include the sales & the service support staff These teams have the support of the top management & are empowered to take decisions on the final price.y Few Account Sales Keyaccounts or customers who give incremental returns to the y y y y y firm are termed as key accounts or national accounts They purchase significant volume or have characteristics like the involvement of multiple people in decision making. credit issues etc . purchases at the central authority level etc Its objective is to build a profitable long term relationship with a set of firms across multiple levels. functions etc in both buyer & seller firms Sales staff are never allowed to handle these customers Organizations constitute sales teams to cater to these customers . service agreement.
which allows customers to place orders online .Sales Process Automation y Development of low cost but high capacity communication systems has allowed large corporates to automate the selling process y Includes telemarketing. Online selling & Internet marketing y It has led to the substitution of e-mail. video conferencing etc for expensive plant location visits y Creation of a mobile & virtual office instead of a home office.
extensive market coverage etc Another variant is a concept called rent a rep Here.Agency & Distribution Selling y In this type of selling. Distributors represent several suppliers y y y y y y simultaneously They are in contractual agreement with the selling organization for the sale of its product or service for Commission They maintain their own sales force & manage the intermediary network They offer advantages like adequate knowledge of the customer & the territory. as they keep on changing the products they sell which depends on the organization they represent for the day . higher control over the value chain. small firms are not capable of a full time sales force & can rent a sales force from an organization These sales staff sell common products.
increase efficiency.Shared Sales Force y This approach divides the sales force among the no. achieve synergy etc y Downsizing organizations may give short term profit but is likely to affect the long term relationship with customers y These organizations also increase the sales force turnover in the organization . of divisions or product lines of an organization to reduce the operating.
this market constitutes a business of US$ 100 billion y This model allows organizations to conduct teleprospecting at a lower cost where tele representatives cover their territory faster than the actual field force y Companies provide toll free numbers for customer complaints & use call centres to help customers .Telemarketing y It refers to customer contacts by using telecommunication technology for personal selling without direct & face to face interaction y In th US.
every tenth sales staff is assigned a field service support executive who handles the follow up actions after the sales are realized . with less manpower deployed for the staff function y Fewer levels of management will bring down costs & increase promptness in responding to customer complaints y In HCL.Total Quality Management & Team based Selling y This approach suggests that majority of the sales staff should be engaged in indirect customer support & service functions.
of people required to call on the existing customers & targeted prospects & the affordability of the firm y This method is usually adopted by Small firms y The major advantage is that the costs are in line with the current sales levels of the firm y Major disadvantage is that it does not take into consideration issues like market sentiments.Affordability Method y The size of the sales force is always decided by a balance b/w the no. demand patterns etc .
Incremental Method y This method suggests that a salesperson should only be added when the additional revenue from the sales staff is higher than the cost involved in recruitment of a new salesperson y Cost data can be analyzed to determine how many sales people to add when the marginal response rates are positive .
Eureka forbes decides a call norm of five for realizing the sale of an Aqua guard water system y Though this method finds the no.Workload Method y This method takes into account the ideal call norms & the total calls to be made for prospects & existing customers to reach at the sales force size y For example. of people required to cover the market. but it fails to optimize the productivity level of the workforce .