An Assignment on

SALES AND DISTRIBUTION MANAGEMENT

Topic:

Nature & scope of sales management,

Submitted by: BHAVESH JOLIYA

Signature

Batch: 2012-2014 (GIA)

SUBMISSION DATE:

GUIDED BY : Dr. Jay Badiyani

Submitted to: Department of business Administration

M.K. Bhavnagar University

Sales Management: Functions and Importance of
Sales Management

Sales management facilitates the directions of activities and functions which are

involved in the distribution of goods and services. According to Philip Kotler,

Marketing management is the analysis, planning implementation and control of

programmes designed to bring about desired exchanges with target markets for the

purpose of achieving organisational objectives.

It relies heavily on designing the organisations offering in terms of the target

markets needs and desires and using effective pricing, communication and

distribution to inform, motivate and service the market.

Sales or marketing management is concerned with the chalking out of a definite

programme, after careful analysis and forecasting of the market situations and the

ultimate execution of these plans to achieve the objectives of the organisation.

Further their sales plans to a greater extent rest upon the requirements and motives

of the consumers in the market aimed at.

To achieve this objective the organisation has to give heed to the right pricing,

effective advertising and sales promotion, discerning distribution and stimulating

the consumers through the best services. To sum up, marketing management may

be defined as the process of management of marketing programmes for

accomplishing organisational goals and objectives. It involves planning,

implementation and control of marketing programmes or campaigns.

Functions:
(i) Sales research and planning.

(ii) Demand creation.

(iii) Sales costs and budget.

(iv) Price fixations.

(v) Development of products.

(vi) Establishing sales territories.

(vii) Co-ordination of sales.

These functions differ from company to company according to their size and the

nature of their products.

Importance of Sales Management:

Sales management has gained importance to meet increasing competition and the

need for improved methods of distribution to reduce cost and to increase profits.

Sales management today is the most important function in a commercial and

business enterprise.
The following are the other factors showing importance of
the sales management

(i) Introduction of new products in the market.

(ii) Increasing the production of existing products.

(iii) Reducing cost of sales and distribution.

(iv) Export market.

(v) Development in the means and communication of transportation within and

outside the country.

(vi) Rise in per capita income and demand for more goods by the consumers.
What is Sales Management?
One definition: The management of the personal selling part of a companys
marketing function.

Another definition: The process of planning, directing, and controlling of

personal selling, including recruiting, selecting, equipping, assigning,
supervising, paying, and motivating the personal sales force.

Sales management is the attainment of sales force goals in an effective and

efficient manner through:

Planning

Staffing

Training

Leading

Controlling organizational resources

Planning:
The conscious, systemic process of making decisions about goals and activities that
an individual, group, work unit, or organization will pursue in the future and the use
of resources needed to attain them.

Staffing:
Activities undertaken to attract, develop, and maintain effective sales personnel
within an organization.

Training:
The effort put forth by an employer to provide the salesperson job-related culture,
skills, knowledge, and attitudes that result in improved performance in the selling
environment.

Leading:
The ability to influence other people toward the attainment of objectives.

Controlling:

Monitoring sales personnels activities, determining whether the organization is on

target toward its goals, and making corrections as necessary.
 EXTERNAL ENVIRONMENT

Organization is a social system that is goal directed and has a deliberated

structure.

Goal directed means an organization is designed to achieve some outcome.

Social means being made up of two or more people.

Deliberated structure means the tasks are divided, and the responsibility for
their performance is assigned to organization members.
MAJOR PARTS OF AN ORGANIZATIONAL SYSTEM

Organizational effectiveness is the degree to which the organization achieves a

stated objective.

Organizational efficiency refers to the amount of resources used to achieve an

organizational goal.

Nonmanagerial Salespeople

Sales Trainee Salesperson Key Account

 First-Line Managers

Evolution, Nature and Importance of Sales Management

Evolution of Sales Management

Situation before industrial revolution in U.K. (1760AD)

Situation after industrial revolutions in U.K., and U.S.A.

Marketing function splits into sales and other functions like market research,
advertising, physical distribution
 Hea
d-
Mar
keti
ng

Man Man Man Man Man

age age age age age
r- r r r r
Pro Mar Sale Mar Cus
mot ket s ket tom
ion Res Logi er
ear stic Ser
ch s vice

Relationship Selling

Salespeople concentrate their team selling efforts on building trust and

service on a few carefully selected customers over a long period with a aim of
becoming a preferred or sole supplier

Transactional Relationship / Selling:- one type of relationship marketing

in which salespeople make one-time sales to price-oriented customers ,who
are not contacted again

Value added Relationship / Selling:- understanding current and future

needs of customers and meeting those needs better than competitors with
value added solution to their problems

Collaborative relationship :- a type of relationship marketing in which a

selling organization works continuously with its large customers to improve
the customer performance in terms of operations , sales and profit
 Varying Sales
Responsibilities / Positions /
Jobs

Importance of Personal Selling and Sales Management

The only function / department in a company that generates revenue /
income

The financial results of a firm depend on the performance of the sales

department / management

Many salespeople are among the best paid people in business

It is one of the fastest and surest routes to the top management

Roles and Skills of a Modern Sales Manager
Some of the important roles of the modern sales manager are:

A member of the strategic management team

A member of the corporate team to achieve objectives

A team leader, working with salespeople

Managing multiple sales / marketing channels

Using latest technologies (like CRM) to build superior buyer-seller

relationships

Continually updating information on changes in marketing environment

Skills of a Successful Sales Manager

People skills include abilities to motivate, lead, communicate, coordinate,
team-oriented relationship, and mentoring

Managing skills consist of planning, organizing, controlling and decision

making

Technical skills include training, selling, negotiating, problem-solving, and

use of computers
 CE
O/
Pre
sid
V. P.ent
Sales /
V. P. Marketing

National Sales Manager

Regional / Zonal / Divisional

Sales Managers

District / Branch / Area Sales Managers

Sales Trainee / Sales Person / Sales Representative

E.G. A company wants to increase

sales of electric motors by 15
percent, as one of the sales
objectives.
Emerging Trends in Sales Management

Global perspective

Revolution in technology

Customer relationship management (CRM)

Sales force diversity

Team selling approach

Managing multi-channels

Ethical and social issues

Sales professionalism

Linking Sales and Distribution Management

Either sales management or distribution management cannot exist, operate
or perform without each other

To achieve the sales goals of sales revenue and growth, the sales
management plans the strategy and action plans (tactics), and the
distribution management has the role to execute these plans
SCOPE OF SALES MANAGEMENT
Sales management directs the sales force. Therefore, it must know the art
and science of personal selling.

Personal selling is accomplished through salesmanship. The sales executive

must know the activities of salespersons, including salesmanship and the
problems faced by salespersons.

From the organizations viewpoint, there are three objectives of sales

management:

Achieving sufficient sales and volume, providing ample contribution to

profits, and experiencing continuing growth. The top management delegates to the
marketing management, which then delegates to the sales management During the
planning phase that precedes this goal setting, sales executives provide informed
estimates on market and sales potentials, the capabilities of the sales force and the
middlemen.

Characteristics of the Sales Job

There are several distinguishing features of a sales job.

A salesman is the ambassador of his company to the external world.

He leaves a lasting impression on those with whom he interacts and who

form an opinion about the company from his behavior.

A salesman needs human relations skill much more than others. As he

interacts with a variety of people in diverse situations, he must show
diplomatic skills and composure.

He should also use tact and intelligence while dealing with his customers
Categories of Salespersons

Selling jobs can be classified on the basis of the creative input needed to perform
them. Thus we have several categories of salespersons, such as:

Just delivery: Here several sales people simply fulfill orders by delivering the product
a driver of a van of soft drink bottles, a milk vendor, or persons at the petrol
pumps.

Order takers: The salesman behind the counter of a grocery store or a bookstore
listens to the requirements of the customers and serves them the right products.
These order takers may be found in the field as well, e.g., salesman selling
hardware items.

Missionary selling: Here are persons who build an image of the organization and
generate goodwill for it. For instance, those selling pharmaceuticals (medical
representatives) are missionaries.

Sales engineers: These are sales people who have a good technical knowledge of
the product.

Creative selling: Salespersons use their creativity to sell tangible products, like
computers or aircraft, as well as intangible products, like insurance, consultancy
services, advertising services, etc.
The Role of a Salesperson:
1. Salespersons have key responsibilities, both to their employers and to those who
buy and use their firms products. The top management holds them responsible for:
(i) obtaining sufficient sales volume, (ii) providing ample contributions to profits, and
(iii) continuing business growth.

2. Sales managers are in charge of personal-selling activity, and their primary

assignment is management of the personal sales force. Todays sales managers are
responsible for organizing the sales effort, both within and outside their
organizations.

3. Within the organization, the sales manager builds a formal and informal
organizational structure that ensures effective communication not only inside the
sales department but also in its relations with other organizational units. Outside
the organization, the sales manager serves as one of the companys most important
contact point with customers.

The sales manager is responsible for building and maintaining an appropriate

and effective distribution network.

Todays sales managers are responsible not only for using but for
participating in the preparation of information critical to the making of key
marketing decisions, such as those on budgeting, quotas, and territories.

They participate in marketing decisions regarding products, marketing channels

and distribution policies, advertising and other forms of promotion, and pricing.
Thus, the modern sales manager is both an administrator in charge of personal-
selling activity and a member of the executive group that makes marketing
decisions of all types.
Personal selling:

Introduction:

Sales management, personal selling and salesmanship are all related. Sales
management directs the personal selling effort, which in turn, is implemented
largely through salesmanship. The term personal selling and salesmanship
are often used without distinction. However, there are vital differences
between two terms. Personal selling is a broader concept than salesmanship.

Salesmanship is one of the aspects of personal selling. Salesmanship is one

of the skills used in personal selling, it is not all of it. Salesmanship is the art
of successfully persuading prospects or customers to buy products or
services from which they can derive suitable benefits, thereby increasing
their total satisfaction. Salesmanship is seller initiated effort that provides

Prospective buyers with information, and motivates them to make favorable

decisions concerning the sellers products or services.

Personal Selling is a highly distinctive form of promotion. It is basically a

two way communication involving not only individual but social behavior also.
It aims at bringing the right products to the right customers. It takes several
forms including calls by companys sales representative, assistance by a
sales clerk, an informal invitation from one company executive to another. It
is employed for the purpose of creating product awareness, stimulating
interest, developing brand preference, negotiating price etc.
Definition:
Personal Selling- is direct oral communication designed to explain how an
individuals or firms goods, services, or ideas fit the needs of one or more
prospective customers.

Salesperson - An individual acting for a company by performing one or more

of the following activities: prospecting, communicating, servicing, and
information gathering.

As we begin the 21st century, selling continues to

develop,
becoming more professional and more relational
 More emphasis on
developing and
Intensifi maintaining trust-
ed based, long-term
competi customer
tion relationships

Contributions of Personal Selling: Sales people and Society

Salespeople help stimulate the economy

Sales people help with the diffusion of innovation

Contributions of Personal Selling: Salespeople and the Employing Firm

Salespeople generate revenue

Salespeople provide market research and customer feedback

Salespeople become future leaders in the organization

Contributions of Personal Selling: Salespeople and the Customer

Salespeople provide solutions to problems

Salespeople provide expertise and serve as information resources

Salespeople serve as advocates for the customer when dealing with the
selling organization
Types of Salespeople:

Personal Selling Tasks

Order-getting

Order-taking

Supporting

The Selling Environment

Three Selling Environments

Telemarketing

Over-the-Counter Selling

Field Selling

Over-the-Counter Selling

Usually conducted in retail outlets

Order taker- is a salesperson who only processes the purchase that

the customer has already selected

Order getter- is a salesperson who seeks to actively provide

information to prospects, persuade prospective customers, and close
the sales

Suggestion selling- occurs when the salesperson points out

available complementary items in line with the selected item(s),
in order to encourage an additional purchase

Field Selling

Involves calling on prospective customers in either their business or

home locations (be order takers or order getters)

Professional Salespeople
 National Account Managers-highly skilled salespersons who call on
key customers headquarters sites, develop strategic plans for the
accounts, make formal presentations to top-level executives, and assist
with all the product decisions at that level

Missionary Salespeople- they do not seek to obtain a direct order

from their customers, their primary goal is to persuade customers to
place orders with distributors or wholesalers

Support Salespeople- help the order-oriented salespeople-but they

dont try to get orders themselves

PERSONAL SELLING OBJECTIVES:

The qualitative personal selling objectives are long term and Concern the
contribution management expects personal selling to make in achieving long-
term company objectives. These objectives generally are carried over from
one periods promotional program to the next. Depending upon company
objectives and the promotional mix, personal selling may be assigned such
qualitative objectives as-

1. To do the entire selling job (as when there are no other elements in the
promotional mix).

2. To service existing accounts (that is, to maintain contacts with present

customers, take orders, and so forth).

3. To search out and obtain new customers.

4. To secure and maintain customers cooperation in stocking and promoting the

product line.
5. To keep customers informed on changes in the product line and other aspects of
marketing strategy.

6. To assist customers in selling the product line (as through missionary selling).

7. To provide technical advice and assistance to customers (as with complicated

products and where products are especially designed to fit buyers specializations).

8. To assist (or handle) the training of middlemens sales personnel.

9. To provide advice and assistance to middlemen on management problems.

10. To collect and report market information of interest and use to company
management.

The basic considerations in setting qualitative personal selling objectives are

decisions on sales policies and personal selling strategies and their role in the
total promotional program. After this role is defined, qualitative long-term
personal selling objectives are set.

In turn, the qualitative personal selling objectives become the major

determinants of the quantitative personal selling objectives.

The quantitative objectives assigned to personal selling are short term and
are adjusted from one promotional period to another. The sales volume
objective-the rupee or unit sales volume management sets as the target for
the promotional period-is the key quantitative objective.

All other quantitative personal selling objectives are derived from or are
related to the sales volume objective. Thus, discussion here focuses upon the
setting of sales volume objectives.

Setting the sales volume objective influences the setting of other quantitative
personal selling objectives, among them the following:

1. To capture and retain a certain market share.

2. To obtain sales volume in ways that contribute to profitability (for example, by

selling the optimum mix of company products).

3. To obtain some number of new accounts of given types.

4. To keep personal selling expenses within set limits.

5. To secure targeted percentages of certain accounts business.

References:

Roburt J. Calvin, Sales Management, Tata McGraw Hill.

5. Dalrymple, Cron, and Decarlo, Sale Management, John Wiley and Sons.
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