DESIGNING SALES FORCE STRUCTURE

AND SIZE

SUBMITTED BY: D15M80-D15M100

INTRODUCTION

 Although selling is an extremely important function in

most organizations it does have something of a bad
reputation.
 This has mainly come about from the kind of hard selling
associated with door-to-door selling.
 This image is quite far removed from the majority of
selling that takes place especially in the business-to-
business sector.
 Much of a salesperson’s time is not actually taken up by
selling but with a variety of other tasks that they have to
undertake in order to achieve the sale
SALES ORGANIZATION

 Sales force organization refers to the type

and size of the sales force. The type
determines the degree of controllability while
the size has profit implications. If the sales
force is large the organization has to decide
about the kind of specialization and co-
ordination to use.
SALES FORCE MANAGEMENT

 Efforts put forth to attain a company’s sales objectives.

 Sales management can involve any of the following activities:
(1) formulation of sales strategy through development of
account management policies, sales force compensation
policies, sales revenue forecasts, and sales plan.
(2) implementation of sales strategy through selecting,
training, motivating, and supporting the sales force, setting
sales revenue targets.
(3) sales force management through development and
implementation of sales performance, monitoring, and
evaluation methods, and analysis of associated behavioral
patterns and costs
SALES FORCE OBJECTIVE

A Sales Force will have one or more of the following tasks.

 Prospecting – search for leads
 Targeting – allocation of time between prospects and
customers
 Communicating – info about company and products
 Selling – Approach, presentation, answering
objections, closing sales
 Servicing – consulting, technical, financing, etc
 Info gathering – market research
 Allocating – scarce products to customers.
SALES FORCE STRATEGY

Ways sales reps work with customers to maintain company

competitive edge:
 Rep to buyer – discuss issues with a prospect or customer
 Rep to buyer group – rep gets to know as many members of buyer
group as possible
 Sales team to buyer group
 Conference selling – company sales rep and resource group to
customer to talk big problems or opportunities
 Selling Seminar – Company team to group of buyers/customers
 Once company has strategy can go with direct sales force or
contractual force. Direct sales force is standard sales force with
office and field reps, while contractual reps are purely commission
sales forces.
SALES FORCE STRUCTURE

 Territorial – each rep gets own piece of land to work

equally divided by workload or potential – result is no
customer confusion as to who the rep is
 Product –Sales force sells along product lines
 Customer – Sales force sells along Customer/Industry
lines
 Complex – combination of both
SALES FORCE SIZE

 Depends upon the number of customers you want to

reach then:
 Group customers into classes by annual sales volume
 Establish desired call frequency-The number of calls
to be made per year on each account in a size class
 Classes size time freq. = workload
 Determine number of calls a rep can make a year
 Workload divided by rep calls per year = number of
reps needed
SALES FORCE MANAGEMENT

Steps in sales force management:

1. Recruitment
2. Selection
3. Training
4. Supervising
5. Motivating
6. Evaluating
RECRUITMENT

 It is the process of finding out candidates, who are

encouraged to apply.
 Selection is the process of choosing some out of many
candidates. Therefore, we can say that selection is
recruitment, but recruitment is not selection.
 Selection is the process of rejection of unfits.
Recruitment precedes the selection process.
SELECTION

The process of selecting differs from one place to another.

Each firm has it’s own method of selecting people. The qualities
expected must match with the job description and the person
should be qualified enough too. The steps followed for selection
is the same in all the places:
 Application Blank
 Screening
 Reference
 Personal Interview
 Test
 Medical examination
 Final interview
TRAINING

Training is the continuation of selection. After selection,

the sales manager will have two options.
 Send him to the work field directly
 Send him for training program
It is always advisable to train a person before sending him
to the work floor. Training means the process of
perfecting the salesmen for their work. It is the organized
procedure through which knowledge as well as skill, for a
particular purpose, is acquired.
TRAINING METHODS

There are five training methods:

1. Class Room / Conference Training
2. Behavioral Learning / Simulations
3. Online Training
4. Absorption / Self learning Training
5. On-The-Job Training
SUPERVISING

 Directing the sales force

 Identify customer targets and set call norms
 Develop prospect targets
 Ensure efficient use of time and assets
MOTIVATION

 Mostly believed that the higher the salesperson’s

motivation, the greater the effort and the resulting
performance, rewards, and satisfaction-and thus further
motivation.
 Sales managers must be able to convince salespeople
that they can sell more by working harder or by begun
trained to work smarter
 Sales managers must be able to convince salespeople
that the rewards for better performance are worth the
extra effort.
MOTIVATION

In this stage organization identify the attribute that

motivates the sales executive to perform well.
There are two types of incentives given by the
organizations:
 Financial incentives
 Non-financial incentives
TYPES OF INCENTIVES

 FINANCIAL INCENTIVES
* Salary package
* Flexible expenses
* Fringe benefits…etc…
 NON-FINANCIAL BENEFITS
* Promotion
* Recognition
* Awards
EVALUATION

 To know whether the sales executives are achieving the

quotas set for them i.e. sales plans, the reports of their
performances are compared against the set standards.
 On the basis of the information, the conclusions are
drawn and accordingly incentives are announced.
 If required the sales executives are motivated and
trained.
COMPENSATION
Compensation is made in three ways;
 Direct salary:
In this method sales executives are given fixed salary per
month.
Direct commission:
In this case the executives will be working on commission
basis…e.g : Life insurance agents.
Combined plans:
It is a mixture of straight salary and straight commission
plans. In this method the sales executives are paid their regular
salary plus their commission on the sales they make. e.g. BMTC
pays their conductors a fixed salary + 2% Commission on the sale
of tickets.