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Amity Business School

Sales Management

AMITY GLO

BAL BUSINESS SCHOOL,

PUNE

Sales management is attainment of an

organization's sales goals in an effective &

efficient manner through planning, staffing,training, leading & controlling

organizational resources.

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Amity Business SchoolDefinition

According to American Marketing Association, SM is The planning, direction, and control of personalselling, includingrecruiting,selecting,equipping,assigning,routing,supe

rvising,paying and motivating as these tasks apply tothe personal workforce

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Amity Business SchoolObjectives

Sales Volume

Contribution to Profits

Continuing growth

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Evolution of Sales Management Prior to industrial revolution, not much

emphasis was given on sales. Small scale

enterprises dominated the scene. With the beginning of industrial revolution,

need to establish functional departments

was identified. Still no separate salesdepartment was created.

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Middlemen like whole sellers and retailers

came into picture.

With the complications in the channel ofdistribution, there was a realization of

separate sales department.

The advent of specialized salesdepartments helped the organizational

problem of market expansion.

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Personal Selling DefinedPersonal selling refers to personal

communication with a an audience

through paid personnel of an

organization or its agents in

such a way that the audience

perceives the communicators

organization as being the sourceof the message.

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Amity Business SchoolCharacteristics of Personal Selling

PRO CONS

Can not reach mass

audience

Expensive per contact Numerous calls needed

to generate sale

Flexibility:

Adapt to situations

Engage in dialog

Builds

Relationships Long term

Assure buyers receive

appropriate services

Solves customers

problems

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Amity Business SchoolPersonal Selling Tasks

Order getting Seeking out customers

Creative selling

Pioneering

Account management Order taking

Routine

writing up orders

checking invoices

assuring prompt order processing

Suggestive selling

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Missionary

Detailer

Goodwill

Closers

Cross-functional

Account service rep

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Amity Business School.

PROSPECTING: IDENTIFYING POTENTIAL CUSTOMERS

APPROACHING THE PROSPECT

FOLLOWING UP

CLOSING THE SALE

HANDLING OBJECTIONS

MAKING THE SALES PRESENTATION

Pre approach:QUALIFYING PROSPECTS

The Personal Selling Process

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Amity Business SchoolClassification of

Personal Selling Approaches Stimulus Response Selling

Mental States Selling

Need Satisfaction Selling

Problem Solving Selling

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Stimulus Response Selling

Salesperson

Provides

Stimuli

Buyer

Responses

Sought

ContinueProcess until

Purchase

Decision

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Mental States Selling

Attention Interest Desire Action Satisfaction

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Need Satisfaction Selling

Uncover and

Confirm

Buyer Needs

PresentOffering to

Satisfy

Buyer Needs

ContinueSelling until

Purchase

Decision

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Problem Solving Selling

Define

Problem

GenerateAlternative

Solutions

Continue

Sellinguntil

Purchase

Decision

EvaluateAlternative

Solutions

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Sales JobsBroadly divided into direct and Indirect sales

jobs.

Direct Includes:Consumable sales (Sales Representative)

Capital equipment sales (Sales

Executive)Capital equipment sales (medium

value)/High Value

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OEM/Engineering sales (Technical

Sales/Sales Engineer)

Service sales Indirect.

Distributor Sales

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Sales skill set

Be Trustworthy

Behave Ethically Understand Buyer Behavior

Possess Excellent Communication

Skills

Negotiation skills

Customer centric approach

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Overall Skills required by Sales People

1.Be Thorough in your product

knowledge2.Know your competitor & hisproducts well3.Should know how to

prospect4.Establish rapport with

strangers5.Be a good listener

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Good at making oral

presentations7.Demonstrate Product

Benefits8.Handle customer concerns9.Bewell groomed, dress well & maintain good

oral hygiene10.Speak slowly, clearly,

flawlessly & with confidence

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Organization Buying BehaviorThe Environment

Marketing

Stimuli

Other Stimuli

Product

Price

Place

Promotion

Economic

Technological

Political

CulturalCompetitive

The Buying Organization

(Organization Influences)

Buyer responses

Product or service

Choices

Supplier choice

Order quantities

Delivery terms and

times

Service Terms

Payment

(

Buying

Decision

Process

The Buying

Centre

Interpersonal&Individual

Differences

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Buying Situations

Straight Rebuy

Modified Rebuy

New Task

T ti l & R l ti hi S lli

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Transactional & Relationship Selling

Model

Transaction-Focused Relationship-Focused

Short term thinking

Making the sale has

priority over mostother considerations

Interaction between

buyer and seller is

competitive

Salesperson is self-interest oriented

Long term thinking

Developing the

relationship takespriority over getting

the sale

Interaction between

buyer and seller is

collaborative. Salesperson is

customer-oriented

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Amity Business SchoolSales Team Structure

National Sales Manager

Regional Sales Managers

District Sales Managers

Sales Training Manager

Sales Training Manager

Sales Manager

SalesExecutives

E l ti f th t

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Evaluation of the teams

Are teams large enough in number? Does a team have a truly meaningful

purpose?

Are there adequate levels ofcomplementary skills?

Does the team have specific goals and

objectives? Does the team have a clear working

approach and decision process?

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Amity Business SchoolEight Approaches to Building Team

Performance1. Establish urgency and direction.

2. Select members based on skills and skill potential, not personalities.

3. Pay particular attention to first meetings and actions.

4. Set some clear rules of behavior, especially cooperation.

5. Set and seize upon a few immediate performance-oriented tasks and

goals.

6. Challenge the group regularly with fresh facts and information.

7. Spend lots of time together.

8. Exploit the power of positive feedback, recognition, and reward.

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Job Analysis To whom does the person report? Who reports to this person?

What products does this person sell? To whom does this person sell?

What information should this person gather?

What report should this person make and to

whom?

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Job Description Reporting Relationship

The job objectives

Duties and responsibilities Job performance criteria

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Sources Recommendations by own sales people

Educational institutions

Sales personnel of non-competing firms Employment agencies

Customers recommendations

Unsolicited applications

Competitor's salespeople

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Amity Business SchoolTypes of Interviews

Patterned Interview Nondirective Interview

Interaction Interview(Stress)

Rating Scales

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Amity Business SchoolTesting & Validation

Reference Checks Credit Checks

Psychometric tests

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Amity Business SchoolSales Training

Determining Training Needs Training Analysis

Evaluating

Building Sales Training Program

Instructional methods used in training

D t i i T i i N d

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Determining Training Needs

Job Specifications Trainees background & Experience

Sales-related Marketing Policies

Identifying Continuing Training Needs

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Training Analysis Who will be the trainees

Who will do the Training

When will the training take place Where will the training site be

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Evaluating The Effectiveness Keeping a tab on before and after trainingperformance.

Conducting Written Tests Accompanying Sales Executives

Trainers Evaluation during Training

I t ti l M th d U d I

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Instructional Methods Used In

Training

Lecture

The Personal Conference

Demonstrations Role-Playing

Case Discussions

Impromptu Discussion

Gaming

On-the-job Training

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Programmed Learning

Correspondence Courses

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Sales Force Motivation Inherent nature of Sales Job Sales Persons boundary position and role

conflicts Tendency toward Apathy

Maintaining a feeling of Group Identity

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Maslows Hierarchy of Needs Different Sales Persons behave differentlydue to different needs.

Primary need & Secondary need

Motivation Mix for Sales person

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Motivation Mix for Sales person

TsSalesperso

n

Special

Financial

incentive

Nonfinancial

rewards

Leadership

Techniques

Management

control

procedures

Basic

Compensation

Plan

Sales Force Compensation

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Sales Force Compensation

Advantages- Salaries are simple to administer

- Planned earnings are easy to project.

- Salaries can provide control over salespeoples

activities, and reassignments are less of a problem.- Salaries are useful when substantial development

work is required.

Disadvantages

- Salaries offer little incentive for better performance.- Salary compression could cause perceptions of

inequity among experiences salespeople.

- Salaries represent fixed overhead.

Straight Commission :

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Straight Commission :

Advantages

- Income is linked directly to desired results.

- Straight commission plans offer cost-control

benefits.

Disadvantages

- Straight commission plans contribute little to

company loyalty.

- Problems may also arise if commissions are not

limited by an earnings cap.

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Amity Business SchoolStraight Commission: Rates

Constant rates:

Rates that remain unchanged over the pay period.

Pay is linked directly to performance.

Progressive rates:

Rates that increase as salespeople reach pre-specifiedtargets.

Regressive rates:

Rates that decline at some predetermined point.

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Amity Business SchoolCombination Plans

Advantages- Combination pay plans are flexible.

- They are also useful when the skill levels of thesales force vary.

- Combination pay plans are attractive to high-

potential but unproven candidates for sales jobs.

Disadvantages- Combination pay plans are more complex and

difficult to administer.

- A common criticism of combination pay plans isthat they tend to produce too many sales forceobjectives.

Bonuses

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Bonuses

Bonus is an additional financial reward to

the salesperson for achieving results

beyond a pre determined minimum. Fringe benefits

Guidelines for Motivating and Rewarding

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Guidelines for Motivating and Rewarding

Salespeople

1. Recruit and select salespeople whose personal

motives match the requirements and rewards

of the job.

2. Attempt to incorporate the individual needs of

salespeople into motivational programs.

3. Use job design and redesign as motivational

tools

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4. Provide adequate job information and

assure proper skill development for the

sales force.

5. Concentrate on building the self-esteem of

salespeople.

6. Take a proactive approach to seeking out

motivational problems and sources of

frustration in the sales force.

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Amity Business SchoolTerritory Management

Sales territory is a grouping of customersand prospects to an individual

salespersons.

Territorial assignments lend direction tothe planning and control of sales

operations.

Breaking down the total market intosmaller units makes control of sales

operations more effective

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Amity Business SchoolReasons for Establishing

Territories

Providing proper Market Coverage

Controlling Selling Expenses

Assisting in Evaluating Sales Personnel Contribution to sales force Morale

Aiding in coordination of personal selling

and advertising Establishing Sales persons

responsibilities

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Amity Business SchoolSetting up the Sales Territory

Selecting a Basic Geographical Control

Unit(Countries, Zipcode, cities, MIDC etc)

Determining Sales Potential Present inEach Control Unit

Combining Control Units into Tentative

Territories Adjusting for Differences in Coverage

Difficulty and Redistricting Tentative

Territories

f

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Amity Business SchoolPlanning for sales call

Builds Self-Confidence

Develops an atmosphere of goodwill

Creates professionalism

Increases Sales

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Steps in planning

Determining sales call objectives

Develop customer profile

Develop customer benefit Develop sales presentation

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Effective Sales Presentation Credibility

Know your audience

Customize according to audience Add Humor/Entertain the audience

Time your presentation

Dont waste time on wrong clients

Dont shoot for the moon(try cracking costliest

deal, start with small ones)

Set up the stage properly

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Amity Business SchoolProspecting

Formulating prospect definitions

Searching out potential accounts

Qualifying prospects and determining

probable requirements

Relating company products to eachprospects requirements

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Amity Business SchoolFormulating Prospect

Definitions

Willingness

The financial capacity

Authority to buy Availability

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Documents