Professional Documents
Culture Documents
BBA V SEMESTER
BBAE0201: SALES &
DISTRIBUTION
Syllabus-Module-I
MANAGEMENT
Introduction & Concept of Sales Management: Nature, meaning, scope and objectives of Sales
Management. Concept and Principles of Sales. Distinction between marketing and sales
Management. Objectives of sales. Selling Process: Preparation, prospecting, pre-approach, sales
presentation, closing of sales. Market identification sales forecasting qualitative and
quantitative methods. Sales organization its functions and forms.
Sales Manager and Sales Force: Qualities, types and their functions / duties. Recruitment,
Selection, Training and Remuneration of Sales Force.
given to customer needs. Supplies of best possible offerings were made available to the
customers.
Seventh Generation- Sales person started acting as a moderator. Focus is not just on selling
but telling about the long term consequences of the product. Helps in developing trust among
customers. Improvement in the quality and quantity of sales. Personal satisfaction for both
customer as well as sales-person.
2
BBAE0201: SALES & DISTRIBUTION MANAGEMENT
Relationship Selling: The salespeople make efforts to build a strong customer relationship to
sell the products or services effectively.
Marketing Management Integration: Marketing is a broader concept;
marketing management includes all the activities related to sales management.
Different Sales or Job Position: It is the combined efforts of the whole sales team, including
salesperson, sales executive, sales head, sales manager and after-sales service personnel.
Pervasive Function: It is a universally applicable concept which has been adopted and tested
by every kind of business organizations.
3
BBAE0201: SALES & DISTRIBUTION MANAGEMENT
Sales Planning or Forecasting: The sales-related activities need to be planned well in advance
through anticipation of future sales prospectives.
Sales Budgeting: The sales manager needs to determine or estimate the sales budget, i.e., the
expenses which will be incurred in carrying out the sales activities.
Determining Structure and Size of Sales Organization: The department of a company
which is solely responsible for all the sales-related functions is termed as a sales organization.
It provides for determining the size, composition and structure of a sales organization.
Human Resource Planning: The sales management ensures a proper estimation of sales
personnel requirement in the organization.
Hiring Sales Personnel: It initiates the recruitment and selection of efficient and suitable
candidates for various vacant sales positions.
4
BBAE0201: SALES & DISTRIBUTION MANAGEMENT
Training and Development of Salespeople: It also includes providing training and orientation
to the selected candidates to develop their skills and knowledge to match those required for the
job position.
Developing The sales manager set up achievable objectives or
goals for the salespeople appointed under him / her.
Fixing Sales Quotas: Also, the sales quota (monthly, quarterly or yearly) is fixed, either in
terms of volume or value of sales to set targets for the sales team.
Determining Sales Territories: Every sales team or salesperson is given a particular region or
area as a target market, where they need to penetrate for selling products or services.
Motivating Sales Personnel: It also emphasizes on reviewing the work of salespeople and
driving them frequently to perform better.
Compensation and Remuneration of Salespeople: It ascertains appropriate salary,
remuneration, allowance, commission and other benefits to the salespeople.
Controlling Salesforce: Exercising sufficient control by monitoring the performance of the
sales personnel is also a crucial function of sales management.
Branding, Labelling and Packaging: The sales personnel gather customer feedback on the
acceptability of the product packaging, presentation, branding and labelling.
Managing Distribution Channel: It also ensures keeping track of the marketing channels and
filling the loopholes if any.
Sales Promotion: The product advertisements and other promotional tactics are also
determined through sales management functions.
Organizing and Support Service: It includes handling of queries and solving problems of the
sales personnel through proper guidance and support service.
After-Sale Services: The customer recognizes a company mostly through the effectiveness
and efficiency of the after-sale services it provides, which is the concern of sales management.
5
BBAE0201: SALES & DISTRIBUTION MANAGEMENT
6
BBAE0201: SALES & DISTRIBUTION MANAGEMENT
Concept of Sales
A sale is a transaction between two or more parties in which the buyer receives tangible or
intangible goods, services, or assets in exchange for money. Sale is the only function in an
organization that generates revenue / income.
A marketing idea i.e. based only on the selling of goods or services, rather than on whether or not
they are actually needed. Operating under the sales concept, a business would produce goods that it
anticipated as profitable return and then attempt to persuade consumers to purchase them by using
advertising and other sales techniques.
Principles of Sales
1. Principle of objective: According to this principle, the objective of the organization must be
clear to the top management and its employees, so that the desired results can be achieved. It
requires careful analysis related to market trends and conditions so that the robust objective can
be designed or formulated.
2. Principle of continuity: According to this sales management should be done in such a way
that, it fulfills all the needs of the business continuously and it may be changed as and when
required.
3. Principle of co-ordination: This principle lays emphasis on the co-ordination between the
different departments, their sub-departments and their workers in the organization so that
mutual understanding between the workers and departments can be achieved. This mutual
understanding leads to achievement of organizational objectives on time bound manner.
4. Principle of flexibility: This principle says that sales management and sales organizational
structure should be flexible in nature so that whenever change is required; it can be easily
changed and implemented for better results.
5. Principle of certainty: According to this work or each worker should be decided well in
advance and it should be kept certain. This makes the sales management effective. Here, it is
necessary that sales management should plan the sales area, territories and sales quotas well in
advance.
7
BBAE0201: SALES & DISTRIBUTION MANAGEMENT
6. Principle of control: According to this principle every work of management and workers must
be controlled so as to increase sales volume.
7. Principle of authority and responsibility: It lays emphasis on the fact every person in the
organization should know their authority and responsibility so that they can easily achieve
objectives, and their accountably can be verified.
8. Principle of unity of command: This principle means that sales management should be done
in such a way, so that each worker must follow the orders of one boss, or every worker must
have one boss. It is because a worker cannot perform two tasks given by two bosses at a same
time. If the worker has to follow the order of two bosses, than he has to see the priority to
avoid any confusion.
9. Principle of specialization: As per this principle, each employee must be given a job which
he/she can easily perform as per their specialty, skills, abilities and capabilities so that proper
outcome can be achieved and assured.
10. Principle of exception: This principle says that the management of sales should be done in
such a way that decision related to day today working operations must be taken by the workers.
Some decisions which are exceptionally very good or which have got more importance can be
accepted by the top management also.
Some points while be remembered while considered these principles:
Effective Customer relationship management (CRM)
Proper training and orientation programme for sales force
Integration of latest technology that help to develop Sales force automation.
Focusing on Team and creative selling.
Attainment of ethical standards.
Proper environmental and marketing analysis should be done.
8
BBAE0201: SALES & DISTRIBUTION MANAGEMENT
9
BBAE0201: SALES & DISTRIBUTION MANAGEMENT
Process The process of marketing starts at pre- The process of selling starts after
production stage. production.
In marketing, emphasis is given on
product planning and the development of Here, emphasis is given to sell the
Emphasis the product so that it can meet and goods and services which are
match already produced.
satisfaction.
In selling producer is given
Supremacy Here, customer is treated as the King. He
is given the supreme importance. superiority or
supreme importance.
10
BBAE0201: SALES & DISTRIBUTION MANAGEMENT
11
BBAE0201: SALES & DISTRIBUTION MANAGEMENT
Selling Process
A selling process is a set of repeatable steps that a sales person takes to take a prospective buyer
from the early stage of awareness to a closed sale.
y from realizing they have a need for a product to making an actual purchase. And since the sales
process is a journey for a prospect, it is a roadmap for a sales person.
Step 1: Prospecting and qualifying: Before planning a sale, do your research to identify the
people or companies who might be interested in your product or service. This step is called
prospecting, the rest of the sales process. A lead is a potential
buyer. A prospect is a lead that is qualified or determined to be ready, willing and able to buy. The
prospecting and qualifying step relates to the needs awareness step in the buying process.
Methods:
Existing customers
Company sources (website, tradeshow, tele-prospecting)
External sources (suppliers, intermediaries, trade associations).
Step 3: Approach: This is where you make a first impression. You do this by introducing
yourself, explaining the purpose of your call or visit, and establishing a rapport with your prospect.
the customer first. This usually involves introductions, making small talk, asking warm-up
questions, and generally explaining who you are and whom you represent.
There are three common approach methods:
Premium approach: Presenting your potential client with a gift at the beginning of your
interaction.
12
BBAE0201: SALES & DISTRIBUTION MANAGEMENT
Step 4: Presentation and Demonstration: Your research and preparation pays off during the
presentation, when you propose your sales solution to your prospect. By the time you are ready to
solution the customer could use. The presentation should be tailored to the customer, explaining
Now is the time to focus on the benefits of your product or service. This might involve a product
demonstration, videos, PowerPoint presentations, or letting the customer look at or interact with
the product. At this point, the customer is using the information being shared as part of a suite of
possible solutions. They might be researching your offer compared to others. It is during this part
of the sale where you can use upselling and cross selling to engage the customer further.
solutions.
Ask questions about their views to find ways to address them.
Re-
Ideally you will be prepared for what customers will say, and
be ready to respond.
For-example:
Obje
-
Step 6: Closing the sale: The important and sometimes challenging part of the sale is closing
it! This is where you actually have to ask if the potential customer is willing to make the purchase.
If your customer has been convinced your product or service will meet their needs, you close the
sale by agreeing on the terms of the sale and finishing up the transaction. 13
BBAE0201: SALES & DISTRIBUTION MANAGEMENT
Depending on your business, you might try one of these three closing strategies.
Alternative choice close: Assume the sale and offer the prospect a choice, where both options
close the sale.
For example,
Extra inducement close: Offer something extra to get the prospect to close, such as a free
month of service or a discount.
Standing room only close: Create urgency by expressing time is of the essence.
For example,
Step 7: Follow up: Follow-up is the last and important part of assuring customer satisfaction,
retaining customers and prospecting for new customers. This might mean sending a thank you
note, calling the customer to make sure the product was received in satisfactory condition, or
14
BBAE0201: SALES & DISTRIBUTION MANAGEMENT
Forecasting means estimation of quantity, type and quality of future work e.g. sales. For any
manufacturing concern it is very necessary to assess the market trends sufficiently in ad-vance.
This is a commitment on the part of sales department and future planning of the entire concern
depends on this forecast.
Thus we can define sales forecasting as, estimation of type, quantity and quality of future sales.
Goal for the sales department is decided on the basis of this forecast and these forecasts also help
in planning future development of the concern. The sales forecast forms a basis for production
targets.
According to Candiff and Still, sales during a specified future
period, whose estimate is tied to a proposed marketing plan and which assumes a particular state of
Opinion of the customers about the products of other competitors with reference to the product
manufactured by the firm must also be considered.
Changes in Technology: With the advancement of technology, new products are coming in
change of technology.
Government Action: When the government produces or purchases then depending upon the
government policy and rules, the sales of the products are also affected.
Factors Related to the Concern Itself: These factors are related to the change in the capacity
of the plant, change in price due to the change in expenditure, change in product mix etc.
Current Global Conditions: The world is a global village. What happens in one corner of the
world will likely affect a business at the other end of the world.
Delphi Method: This is an improvement over the executive opinion method. This method tries
to determine the forecasts on the likely time period of occurrence of certain future events and
the probability of their occurrence. In this method, a group of experts and a Delphi coordinator
will be selected. The experts give their written opinions/forecasts individually to the
coordinator. The coordi-nator processes, compiles, and refers them back to the panel members
for revision, if any. This to-and-fro process continues for several rounds (usually three).
Sales Force Composite Method: In this method, the organization asks its sales personnel to
come up with their forecasts. It is assumed that such persons who are in direct contact with the
customers and other members of the distribution channel will be better informed about the
trends in demand for the product. The individual forecasts are then combined to get an overall
demand forecast for the organization.
: Under this method of sales forecasting, first, a list of all
potential or prospective buyers is drawn up. Then, a face to face interview with a selected
So, the sales of the preceding three years are considered to forecast the sales of the year of interest.
This is a very simple method and the calculation for this is easy too. When the market is stable for
a considerable period of time, it gives an accurate estimate of sales. Alternatively, this can be
construed that when factors influencing sales are common for previous three years (for calculating
three-year moving average), this method gives accurate projection of sales.
Exponential Smoothing Method: It is similar to the moving average method. In moving
average, the sales of previous years are given equal importance but in exponential smoothing,
the recent past sales are given more weight than the earlier pasts. The objective is to smooth
out fluctuations in the time series for accurate estimation of sales forecast.
The forecaster allows sales in certain periods to influence the sales forecast more than sales in
other periods.
Equation used:
Sales forecast for next period=(L)(actual sales of this year)+(1-
(L) is a smoothing constant, ranging greater than zero and less than 1
Advantages: ccuracy for
short term forecast.
Disadvantages: smoothing constant is arbitrary, not used for long-term and new product forecast.
Decomposition Method:
sales data into components like trend, cycle, seasonal, and erratic events. These components
are recombined to produce sales forecast
Advantages: Conceptually sound, fair to good accuracy, low cost, less time.
Disadvantages: Complex statistical method, historical data required, used for short-term
forecasting only
Naive / Ratio Method: The simplest trend projection is known as naïve method. In this
method, the sales of the future are forecasted as the value of the sales for the previous period. It
is based on what happened in the immediate past will happen in immediate future.
18
BBAE0201: SALES & DISTRIBUTION MANAGEMENT
Advantages: simple to calculate, low cost, less time, accuracy good for short-term forecasting.
Disadvantages: less accurate if past sales fluctuate
Regression Analysis: Under this method first identifying the causal relationship between
company sales (dependent variable, y) and independent variable (x), which influences sales.
If one independent variable is used, it is called linear (or simple) regression, using formula;
rend line.
Regression analysis is a statistical method that is used for representing the linear relationship
between two or more variables. If a relation-ship between two variables exists, then the value of
one variable can be predicted given the information on the value of the other variable.
19
BBAE0201: SALES & DISTRIBUTION MANAGEMENT
20