Channel Management

phistrbionChannel

100 Sales &Distribution Management (T.Y.B.M.S.) (Sen.n Match the columns

101
9. is a plan created by manufacturing business th
the management of a
ha
specifies how the firm intends to transfer its products to intermediaries, retaile, B
and end consumers. Intensive distributionn a) one or
maximum two
10. Is a very sensitive issue and it is very difficult to determine correct prici
ing distributor is used wholesaler, retailer or
policy. lective distribution b) channel conflicts
ANSWERS 2.

1. Channels 3.
Exclusive distribution
c)professional way to find a
solution to
4. local
conflict. any kind of
2. Marketing intermediaries 3. Wholesaler
7. Breaking bulk 4. Product pricing d) image or
5. retailers 6. retailer
market
recognition that a
company enjoys in the
8 Producers 9. Distribution Strategy
Role ambiguity e) to use of
threat by a
10. Product pricing company to make the channel
members perform

II. True or False

6. Collaboration financial audit
1. Vertical conflicts involve a disagreement between two channel members on7 Referent power
8a range of acceptable brands to choose
consecutive levels. from
8. Coercive power h) selfish members who
2. Multichannel conflicts refer to agreements among members in separate only think of selif gain or
personal motives
marketing channels.
9. Distribution audit 1) sensitive issue
3. Misunderstandings are created between channel members by misguiding then
as such creating conflicts in the channel.
10. Aggression )control over the outlets.
4. is used by the weak or disinterested members of the channel.
Aggression
Rewards can be financial, non financial or both.
ANSWERS
5. (1-8), (2-j), (3 - a), (4-i),(5 - b), (6-c), (7 - d),(8-e), (9-, (10-h)

6. The selection process requires judgement, foresight and intuition.

7. Channel control is nota complementary to channel operations.

8. Speed and efficiency relates to speed of delivery or replenishment, order filin
speed and accuracy.
9 Product characteristics indicate product package weight, volume, value, y
etc.

10. Exclusive distribution is an extreme form of selective distribution in which om

one or maximum two - wholesaler, retailer or distributor is used.

ANSWERS
True: 1,3, 5, 6,8, 9, 10
False: 2, 4, 7
 &
102
Sales&Distribution Management (T.Y.B.M.S.) s. Evaluation, Ethics Trends
P u d o r m a n c eE v a l u a t i o n

bem
EVALUATI TION AND CONTR OF SALES 103
The
evaluation and control of the PERFORMANCE
sales management system
The process
ntial process.
consists of five
4 seque

are
interrelated stepsps or
tep-by-step of
stages. These
1. Selling peforma targets, standards and
mplementation and achiever tolerance limits
PERFORMANCE EVALUATION, trategy,
vements. imits for the
sales
2. M
the actual
performance
particular point of time.
position in
relation
ETHICS & TRENDS to the targets
at a
Identifying/ nosing deviations from the
Analyzing/ measuri deviations from
prescribed
4.
targets and given tolerance limis.
******t**** ****************etoidttdtt*t*et*t+*ettet 5. corporating modifications, if and as
necessary, to revise
olan, strategy and the implementation
process.
targets/ objectives,
The evaluati process may reveal that the
SYNOPSIS hose are too high or too low. All targets or
standards are not met
objectives
because
and targets are based on certain
A. Evaluation and Control of Sales Performance nfions
assumptions that may be too rigid or too rtain
general. In some
cases, the
may have been based on
pessimistic vironmental assumptions
Sales Performance and the scenario
bjectives may be conservative or narrOw in scope. The goals and
Methods of Supervision and Control of Sales force
nored the new or assumptions
emerging environmental opportunities. Under the might have
Sales Performance Evaluation Criteria
a5sumptions, the objectives may be too ambitious or unrealistic. opposite set of
Sales Performance Review also possible that the objectives have not
t is
been achieved because the
Sales Management Audit strategy has not been properly
implemented, or the selection of the strategy has not
B. been very appropriate. The sales
Measuring Distribution Channel Performance managemen/strategists have to ascetain which of
these factors or cause-and-effect
Evaluating Channels are at work. relationships
The evaluation and control
Control of Channel system generally operates during the process of
C. Ethics in Sales
implementation of a sales plan or strategy, and the final evaluation of performance is
Management conducted after the
D. New Trends in Sales
implementation process is complete. Performance evaluation
and Distribution can be done either
Management for an individual salesperson or the entire organization.

SALES PERFORMANCE
is the central organizations performance, so
mu ich
ales factor or parameter in an

the future growth of the company depends on it. Everything rightfrom

nOver, market share, profit - all depend on or follows it.
earned by the
es that are
performance is reflected through the revenues

business e end of each financial year. Higher revenues imply better penetration
 Ethics&
Evaluation, Ethie Trends

Sales& Distilbution
Management(1
Y.BMS
MS)Sem. Poo P e r s o n a lC o n t a c t s

sales
perlormance
is an
ndic. alo
int

04 ThuUs sales manager visits customer with each

produu s
in
the market. The
salesperson for
various
f the company's

of the
business. such as,
calling on a specific customer to handle a reason
particular problem,m, traininga
ial strength
lh linan selling effort, and getting market
FORCE
salesperson
strengths and weaknesses of the information. The sales t

SUPERVISION
Supervision
AND CONTROL
OF SALES
refers to the time spent working wilh employees to be certa.
orem
discusses salesperson after the sales call.
METHODS OF tain 4. Coaching

they are aware of the responsibilities of their job and how to perform them cow.of t
The sales
ager has concentrate on the continuous
to

and it
includes directing
and controllino .

salesperson through supervisory feedback and role

th
development of a

Supervision
is a part of
leadership,
There are
variations on how closely
aining salesperson on-the-job
a
modelling. Coaching
of salespeople. who are on intensively through instruction, demonstration,
day-1o-day
activities

should supervise salespeople Usually

salespeople
who
commie
misiog Successful coaching takes place when there is and respect
and
trust
managers
comparison with
salespeople
are compene
pensale
practice

salesmanagerand salesperson. The

between the
basis receive less supervision,
in
major part of
coaching session is the joint sales
a

by salaries. thal is made by the sales manager and the salesperson. After
is made
of tools and
methods to interar
ract call, meeting with the
uses a combination e sales manager discusses the salesperson's areas of
A sales manager
These are direct supervisory methods, and indi. C u s t o m e r ,

improvement.
with salespeople. regular coaching sessions, sales
supervise
Supervisory methods.
managers can
improve selling skills,
an nositive attitudes and work habits, and help the salesperson to be more
efficient.
Methods of Supervision

BIndirect Supervisory Methods:

Direct Supervisory Methods Indirect Supervisory Methods
companies use the
Many tollowing methods, which can have efective
unervisory powers, as they work towards the
company goals and objectives. Some
A DirectSupervisory Methods: of them are

1. Telecommunications 1. Sales reports

Many sales managers Use telephone, e-mail, voice mail, fax messages, an
The salesperson's activities can be monitored and evaluated as a
supervisory tool
computer-based support systems. Companies such Hewlett-Packard, Procter
as
by using the reports. In addition, the data on the customer and competitors given in
Gamble, and 1BM give each of their salespersons a laptop/ computer, for carrying ou
the sales reports is used for the company's marketing information system. Usually
various activities, such as report
writing, call planning, accessing custome sales
information, submitting quotations, corresponding with customers, reports include information about the calls made, orders obtained, new
entering a Customers developed, competitive activities,
monitoring customer orders, and so on. By using the customer problems and needs, and so

these companies have

computerized-support system on.
reported improvement in accuracy, productivity, an
management effectiveness. Salespeople are also required to submit a call plan, which gives the details of
2. Sales Meetings ther plans of customer visits for the upcoming period. The call plan makes a
Sales meetings are used Salesperson plan the activities as per the company norms of calling on variOus
by the sales managers to supply information on
a Classes of
change in policies and procedures, to customers, including time to be spent on prospecting tor new custOnet
arrange for training programmes,
inspire or motivate salespeople to achieve sales and dny Companies consider sales reporting activity as one of the main
quotas.
The sales meeting is not of salespeople and therefore, salespeople are evaluated and rewarded
always a
informal conversation, phone call or a presentation format; it can sometimes be
nsibilities
ased on salespeople providing timely and accurate information in their sales
web chat.
reports.
.MS. Sales &
Distribution
-

Management (Sem. -

V)
 Soles& Dsibution Manapemen! (T. Y.B.M.S) S Evuluation, Ethics & rends
Sem. Peivmance

2. Compensation Plan force Controlling Methods

Sales

t is one of the most important tools that encourage salespeople to cary

carry ou methods are used for 107
those activities that will maximize their income or money earned. In other words,
S e v e

sCriteria, or aspects used for controlling sales force effortsts. Method

he areas
measuring and
compensation plan directs the activities of salespeople, and influences the efforts an
and ritten reports are
submitted by
c
omparing depend on
tie spent by salespeople on various activities activities in prescribe formats. Some
of the salespeople various
widely
on
3 aes Anahsis
Establishing salesterritories practiced methodsaspe
spects of their
include
i n g the sales analysis eport the sales manager can evaluate th Allocating ot sales quota.
ptomane o' each salesperson by comparing what was sold and how much
as Maintaining continuous contact with
soNd with the sales quotas Therearter, the sales manager can guide or
help tho salesmen.
salegple who need help in achieving their sales targets or quotas. Determining authorities and rights of salesmen
Epese Accounts/ Reports Routing and scheduling sales personnel.
Enense eports indicate how much money was spent by salespeople Salesmen's reporting.
raveling koiging meuls. entertainment as compared to the company policies Complaint and objection notes.
various enenses t helps to keep control selling expenses. Many
on sales managen Analyzing sales expenses
areflexible on enense account as long as the additional selling expenses hae
prduced increased sales and protitabilitv. Observation and visits or field trips.
Providing materials and literature
such as sales
visiting cards, order torms, literature, sales manua
anuals
Control of Salestorce
work and behave.
showing small-shorts films to teach the wav to
ales toroe control invohes
measuring sales torce pertormance, comparing
with standards detecting deviations and
causes, and. it necessary, taking correctiv
actions so that pertormance takes Purpose of Supervision and Control
place as per the plans. Ettectiveness of sales torce
manage ent to a large extent depends on controlling mechanism Supervision and control
practiced by the ot the sales torce are
required because of tour
Company. reasons:

Control keeps sales people

alert active, creative, and a Coordinating sales etforts
Suitable controlling system is essential
regular in their efforts
to both,
company and salesmen. Very strict or b) Guiding the sales torce.
veny liberal
controlling system is not advisable. After analysis of the nature of sales
people, pe of work degree of cooperation, and other relevant c)Improvingefticiency in selling.
variables, an
appropriate controlling system should be designed. dEvaluatingpertormance.
t should be noted that control not for Coordination of selling activities of salespeople in ditferent termitories and regions
meant for
is
fault-finding or
punishing others, but s
s essential tor the
help them move in the
right direction. Its purpose is not to keep success of planning and achievement of sales objectives or
targets
unnecessary watch onsales personnel, but to ucn coordination implies a control mechanism. Salespeople come trom diferent
prevent them make mistakes, and, t
necessary, to take suitable corrective actions.
Sales force
control includes veritying CAgrounds social, educational and experience. Coordination and control help
sale force periormance and ultimately contribute
and
taking corrective actions, if needed. For exercising ntroduce necessary professional discipline, to team

control over sales force, mostly, sales building and team effort.
volume, time, expenses,
etc., are used as bases for discipline, activities
measuring
and comparing performance. As extension of coordination is
guiding the sales force. Salespeople require

regular guidance in cour of their work to handle situations, solve problems, tacing
 Aabmaneebiauatio Ethics & Trends
n,

109
BMS) (Sem V)
Sales&Distribution Management (1YB.MS) (Sem each salesperson in terms of these criteria should be
pertorm asse ssed against

competitors etc. Effective guidance can take place only through proper coordinatic
henchmarks by the Company. Individ
set by
company' s sales
tion prioritize each of theKRAs and work out a
managem ment may
and control a 5 s / g nw e r
weights
or

rmance of each salesperson.

weighted
average index
Coordination and guidance help improve the efficiency of salespeople. Regul measure
o fp e r KRAs The mentioned above.are not
supervision and monitoring enable the sales management to detect early an or
i g i do rf i x e d

ny
deviations from pertormance standards and take necessary corective actions. ales managementament of a
particular company may select
This or
modify some of these
finally leads to improvement of eficiency in selling. add
new
new KR
KRAs according to their policy, choice or
KRAS
Or
In fact, each company should establish suitability
Finally, all of these help in the evaluation of the performance of salespeople its own KRAs
Through regular monitoring and control, the evaluation of salespeople can be done
propr
(result).
relating input
oulput
to
effort)
on a continuous basis, with an intention to improve performance. Criteria -

KRA
tability
to sales ratio)
ofitability (profit is one
criteria for of the KRAS or

SALES PERFORMANCE EVALUATION CRITERIA alespersons pertormance. This

nis measure of assessing a
profitability
expresses total gross
The of the evaluation process is d by a salesperson as a ratioo of total sales made by him during a
margin
crux
deciding the right mix of performanca
criteria. The criteria should focus results, and also involve identification of key
g e n e r

A more focused or direct measure of particular

result areas (KRAs).
on
period. salespersons profitability may be
Profit and Loss account for each
salespersons major customer or product handled by
Key Result Areas (KRAs) him.
Key result areas are those tactors or
aspects of sales plan, strategy and To make the salesperson more awa and involved in
implementation in which
profitability, it is a
good
salesperson or a company must excel to outperform
a sdea to equip them with appropriate data on price, cost and margins.
competitors. The salesperson and the company should possess Combination of Quantitative and Qualitative Criteria
underlying
competences or capabilities which should be connected with the KRAs. KRA
analysis KRAS or quantitative indicators help to arrive at
highlights the important relationship between resources, competencies and choice of quantifiable results. In fact, both
sales plan and strategy which is quantitative and qualitative criteria are often inter-related.
important for assessing performance.
KRAs are similar to critical success factors
(CSFs) or key success factors (KSFs) Qualitative criteria range trom personal characteristics of salespeople to self
commonly used as a tool in strategic management for management. Various qualitative criteria can be classified under four heads :
assessing
performance. Some of the key result areas, that are the quantitative organizational )Personal Characteristics
the basis of an effective indicators, form
evaluation and control system for most of the
Some of the KRAs are:
sales forces. Atitude, initiative, creativity, aggressiveness.
Appointments to enquiries/proposals.
i) Knowledge

Enquiries/proposals to sales. Knowledge of product, markets, company policy.

Orders to sales calls (strike rate).
ii) Skill
Sales revenue Selling skills, communication skills.
order
per
Sales per hour of selling time. iv) Self- management

Sales to cost of sales. Planning ability, decision making ability, time management.
Gross profit or margin to sales etc. ing these criteria, the qualitative assessment or evaluation is done through
ratin
Measuring only absolute results (volume of sales, value Oneither a 5-point scale. quantitative
A combination of qualitative and
of sales, cost of sales,
profit etc.) does not make a complete oncriteria may produce different outcomes and recommended reward Or
analysis of sales standards or
performance. The punishment and remedial actions.
 P a d o r m a n c eE v a l
ation, Ethics & Trends
u a t i o n

110 Sales &Distribution Management (T.Y.B.M.S.) (Sen

em-V sALESMANAGEMENT AUDIT
SALES PERFORMANCE REVIEw
or
Sales is the central factor or parameter in an organization's
performane The
compreher
composite evaluation
Everything turnover, market share, profit etc. depends on or follows from
e nination of final
results of system is
the an nual exercise for
organizational performance.
h e d e t e r m i

Therefore, sales performance at the organizational level should be

it and shor
achievements and
nents shortfalls or failures
evaluated fro
om
-

are These results

primarily used feedbacks
diferent perspectives so that the evaluation process helps to identify the
drawbaci. budgeting. target setting and as

or shortfalls in the
strategy formulation and implementation system and appropria.e lanning operations and
strategy
planning. But, during the lessons or

remedial or corrective measures may be undertaken.

s a l e s

reviewe wed and monitore to ensure that

operations remain on the to b regularly
implementation current year,
need
if there are deviatic
cOurse, and if

corrections prescribed
A detailed sales review can be done in two major ways/forms mid-term course path or
es management audit.comes in are made.
the
B y the level in the organization. w h e r e

picture. This is
Sales management audit
By the type of sale.
reviewing and
a
systematic, diagnostic and
The level of the organization can be national, and, then, regional, branch
etc. loc management audit is similar operations or the prescriptive
sales mana
htrolling
tool fo sales
Type of sale can be by product, customer etc. Total sales at the national level ofte
otten
process.

dit or audit in the

to management
management audit and different
conceal the problem areas. For example, in some regions, sales may be very goot
financial a u o
accounting sense. In financial
or
from
financia transaction is checke in accounting audit,
but one region may not be performing well, or, a particular territory is lagging every terms of
in of
management audit or sales
company policy or
approvals. That
performance. Similarly, particular products or brands may be performing well; soma is not the purpose
ome audit is to assess whether a management audit. The objective of
anagement aud
sales management
others may be lagging behind. The same applies to type of customer and distribution firm's sales
channel and payment term. adequate, to give directic for
performance improvement, management process is
and to recommend
needed changes. the
Therefore, a detailed sales review by level of operation and type of sale makes
the sales review process more complete or comprehensive.
Sales management audit should be a
step-by-step
fnualved. The steps include planned sales and course process.
Four major
steps are
There two types of payment cash and credit. Credit sale is quite of operation
are terms -

deviations from the during the year,

in industrial Credit sale also takes place in consumer durables. In planned course ot action, reasons for deviation and
common products. correction.
course
FMCGs, manufacturers may extend credit to distributors and wholesalers. All credit
sales have some risk. If there are delays in realization of Steps in the Sales Management Audit
payment or defaults, it
affects profitability. Non-realization of payment actually means that the saleis Sales management audit should be conducted
not on a
periodic basis -monthly or
complete. Therefore, sales analysis or review by payment term becomes important.
quarterly. The following are the steps involved:
The evaluation of sales i) Establishing and Planning course of operation.
performance can be done against predetermined
standards or benchmarks. The evaluation should be on relative or ii) Deviations from the prescribed course.
comparative basis
to reveal the real
performance of a company. A comparative assessment of sales ii) Analyzing reasons for deviation.
performance of a
company may be made in four different ways or forms with
different bases iv) Course Correction.
of comparison
Since auditing should be objective or without bias, it should be caried out by
a) Actual sales (total) in relation to target. Some team from outside the sales organization, like the corporate planing group. t
b) Sales growth (or decline) relative to last year. Can also be an external agency -
a consulting organization especiallyappointed or
c)Sales growth (or decline) in comparison to should be associated with the
industry growth (decline). purpose. Some managers of the sales organization
d) Sales level compared to that of information, play à
major competitors. process, but more as provider of sales and related
audit. It should
conduct sales management
VE role. Many companies do not correct potential or
actually be undertaken on a regular basis to diagnose and
 12
S Sem Vy
Sales & Distribution Management (T. Y.B.M.S.) e P u f o m a n e e
nce Evauation, Ethics&Trends
E v a l

ee'ging problem situations betore those become serious and get out of of control
control, or
te and also
aluation teria
corre tion or rectification
process becomes lengthy costly. 113

B. MEASURING DISTRIBUTION CHANNEL PERFORMANCE Effectiveness

Equity
The pertormance channel can be measured across multiple
of a
dimensionss.
Efficiency
parameters that measured usually are effectiveness, etticiency,
are The
equity and profitability of the channel.
productie
tivity Delivery Stimulation
Productivity
While channel etticiency emphasizes
intermediaries while pertorming channel functions, channel
controlling
incurred by costs
Evaluation Criteria for Profitability
concerned with maximizing outputs for a productivity is Marketing Channels
given level of inputs. Channel effectiven. L. W. Stern et al.
Marketing Channels (1999
deals with the ( S o u r c e :

intermediary's proficiency in satistying customer needs and ess p.449

equity measures the distribution of accessibility of the channel channa
among customers Equity means the degree to
which
such as distribution
isolated consumer channels serve problem
kets/segments
ts such
distant or
EVALUATING CHANNELS onsumers or markets.
Delivery' shows the extent to pockets along with normal
'De
Evaluation and control are two essential nnel members which or
demand of consumers how much the
to meet the
effective management of distribution ingredients, and also final
steps in g0ods.
channels. delivery of goods. 'Stimulation' assesses the by
ensuring timely
All FMCG members will will stimulate and create latent extent to which how the channel
or
companies, namely HUL, Colgate, Nestle,
-

Procter & demand and convert this

regularly evaluate
the performance of their Gamble etc demand to optimize or maximize sales. into actual
channel members. Evaluation is
commonly done on monthly basis; some more Come of the evaluation criteria are
other companies do on both companies do on quarterly basis; and some di ators and others considered as
short-term
monthly and quarterly basis. Performance evaluation is may be used or
applied for
measures
done on the basis of set
standards, tasks and targets. Tasks and owample, expected is over a long-term results. Equity, fo
sales volume or value, targets can refer to period of time or in the
channel inventory taie stimulation; it takes time to work on latent demand, and
of long-term. The same may be
etc. Evaluation norms
or criteria are
level/management, efficiency, profitability express their demand for the induce consumers to
usually decided and agreed between product. But delivery is short-term; delivery
company and a particular channel the
regular, sometimes immediate whether has to be
partner. from
to wholesalersor distributors
Stern et al have wholesalers to retailers or from retailers to final
suggested five measures or criteria for
channel members. These consist evaluating performance of efficiency should be both short-term and
consumers. Productivity and
of three basic criteria long-term criteria. Productivity
and
Effectiveness efficiency can be measured any time even in the short-term to
assess the
Efficiency performance level of channel members. There would also be
improvement in both productivity and efficiency. long-term targets for
Equity
The evaluation process has
Effectiveness is assessed in terms of two objectives:
measured by productivity and delivery and stimulation; and efficiency is 1To assess the
performance level of different channel members
profitability. to distinguish
between good and average
performance.
lo use the evaluation
system as a feedback process for continuous
mprovement through mutual discusion, counseling and motivation.
 114 Soles &Distribution Management (T.Y.B.M.s)) Sem-v Pedomance eEvaluation, Ethics & Trends
Evaluatio.

CONTROL OF CHANNEL Weekly reports can be short, prec

ise showing
It is very important to monitor control the channel of distribution.
Ch: ion. Channe Monthly
and quarterly reports can be
more into detail nmediate operatioronal results115
control is complementary to channel operations. Channel control ensures
es
parameters
short term or long term.
showing targetsandan planning
operations are on the right track in prescribed norms and standards. The sco Distribution Audit
control be n
rigid. Channel controls can be
SCope
be wide, loose, flexible
can or
ph Many Companies ies use
distribution audit
financial, qualitative, quantitative, formal or informal. It depends on the Con ysic as a
tor means
what kind of control system it ompany ibution
operations. Distribut
notlike financialevaluation and control of
audit is
design.
plans to channe.
audit. The
anagement
objective of istribution audit, but
more than
channel member. audit is systematic
The control system is administered through the instruments of control. ivities, targets and results of a

Instruments of Control audit can easily analysis of

Distr

identify any
The organization can use various systems as control devices or
instrumente
Such
channel.
hese issues can be
deliberated upon andshortcomings in operations of
the basis of the improvement measures can
as
aken by channel memnbers on
a
under

)Control or Agreement review. be

This is the most traditional and oldest instrument

method of exercis. or ETHICS IN SALES MANAGEMENT
control over
functioning or
operations. Most of the
companies enter into a writ. Cising C
agreement with the C & F agents, distributors and dealers. The ritten Sales managers are not only
specifies details of association between the two agreeme
parties and also the term
ment alespeople. Salespeople responsible for their actions
are
considered boundary
but also the ne aactions of
of operations. This may include
many aspects of the relationship and
houndary" between customers and the
in the spanners because they wor
work
of the channel members. The operation that link the customer to the
nc organization. As such, they
major elements covered in the agreement tirm. in this perform
follows are ehical
ethi dilemma involving the tair treatment position, the salesperson oten faces
of customers, the
Products handled. both. organization, or

Territories covered. Sales managers are also

responsible in
establishing, communicating and
Categories or types of customers. enforcing the ethical standards of their sales
sales managers in carrying out various people. Ethical dilemmas are
faced by
Selling price and margins. orders from customers, pricing
sales
management tasks like getting
Sales promotion decisions, hiring salespersons, evaluating
responsibility of channel member. etc. salespeople,
Payment and credit mechanism.
Salespeople should be honest in their
dealings with customers and be informed
Inventory levels. of relevant laws
governing their business situation.
When the channel members include Unethical sales behaviour
are bound
conflict can be by contract, the chances of chanel
considerably reduced. Exaggerating features and benefits.
)Budgets and Reports Lies about
availability of product service.
Contract or
agreement is
implemented in practice through Giving false answers to questions.
reporting from time to time. budgeting and
there is a proper Monitoring and control become easy and Falsifying product testimonials.
reporting system. Reports can be effective
yearly with different formats. weekly, monthly, quarterly o Passing blame for their own mistakes.
Misrepresent warranties and guarantees.
Make nonbinding oral promises.
 PbrmanceEvaluation Ethia rends
& Tren

Sales&
Distribution
Management (T.Y.BM aMS) n Evaluation,

ce D
salesforce Diversity
iv
117

| 16 of salesforce is
characteristic
Bending company rules. The d e m o g r a p h i c

ple are more educated with

changing and berecoming rmor
products. Today salesp

Selling
dangerous
or
hazardous

ethics salespe to be followed by

by varied
to
to manage a salestorce
specialized degrees. Sales
in the organization. Codes
to of
certain code of
set ethics express the values of a firm by Sperivalue managers have
mar
comprising of women, highly educated and
Sales
managers
have

consistent or
inconsistent with those specifying rs
s s educated

tool will
motivationaltool will be
c Derson as wellsenior
as
salespersons. The need,
differer for varied salesperson. expectation,
behaviors that are
code of beha.
to a
writing specific
a salesperson to
conform
avior Hechnology Revolution
sales manager
cannot expect
with. There
are four basic types
es oof
behaves inconsistently ethieg 3 Digital arketing ane
management of information system
manager openly has increased the
codes
for employees. capabilities o f of consumers and market organizations. Today the
that define ethical
boundaries
buyer gets the
1. Company codes produe information ernation instantly and places the
order online within a click of
ethical boundaries for occupational abutton.
codes that define Foup ormation online about any area.
ample infor
2. Professional access

such as advertisers, marketing

researchers, sales representatives.
docton They
can

ctinformation regarding market, competitors,

Companies can also
and so on.
collec prospects, customers online.
create their company websites to provide information
accountants,
lawyers,
codes that define ethical
boundaries for people en.
They can
about their
3. Business association nroducts and services to outside people. Marketers can
company, p r o d u c t

business. customize their

in the same line of produc as per the customers needs and expectations.
suggested by government agencies or other sner
4. Advisony group codes eca can be a two way munication of the company with the
interest groups. Each industry is confronted with unique ethical issues.ang There
prospects,
its code to meet the situation.
mers, intermediaries and suppliers. To compete effectively the sales manager
adapt
must
Ii the sales manager does not treat salespeople honestly and fairly, salespen nd salespeople have to adopt to latest technology. Technology can make the sales
and efficient.
are likely to have low regard for equitable and honest treatment of custome COst effective

suppliers, channel partners, or even coworkers. Similarly, sales managers m4E-Customer Relationship Management
thoroughly know and practice the company code of ethics (assuming one exist F-Customer relationship marketing enables the customers to provide real time
they expect salespeople to follow it. Cusomer service by focusing on meeting the individual needs of each valued
CUstomer through the use of CRM software packages. CRM skills requires building a

D. NEW TRENDS IN SALES AND DISTRIBUTION MANAGEMENT customer database and doing data mining to detect trends, segments and individual
customer needs.
In the changing global environment, the emerging trends in sales an
distribution areas follows: Many companies have initiated CRM programmes to improve relationship
with existing customers. With the
1. Global Perspective help of software it integrates sales, customer
service and market information from various sources. It provides updated
Sales and sales
managers people must manage salesforce
foreig intormation to the
to meet employees on each valued customer to enable them to give
competition in their country and improve the company's personal uperior service.
other country. Sales selling efforts i
managers selling goods at global level face challenges such
different language, culture,
lifestyle,
a5. Team Selling Approach
also consider
buying requirement, negotiation style, etc. Ine
opportunities as many global markets are
d m building approach is used when the company wants to build long term

rapidly. To sell globally the company need not be growing and emerg
large, even small and mediu Onship
with customers having high sales and profit potential. It is also usea in
sized companies can sell in selling technically complex product or selling to a prospective customer. The
global niche markets.
Composition of the
team vary depending on the customer's buying center members
but the selling technical
. ngteam includes the members from the top management,
Specialist, custome service, inside salesperson's requirements by coordinating
118 Ethics & Trends
Sales& Distribution Management ArmanceEaluati.

B.MS) Sem 19
amluation,

within office and

(T.Y.B.M.S
representatives of salesperson. It requires joint QUESTIONS
several persons
and designing an effective compensation plan can beselling aki
effon methods of supervision of sales force. (Refer Pg. no. 104)
chal.o
D i s c u s st h e m e t h o d

hallengng
a
task.
6.) Managing Multi-channels November 2016
s i g n i f icance
c of control of
sales force.
When an
organization uses two or more plain
the

more
marketing channels to reach Explain sales performand management review in detail. (ReferPg. no. 110)
customer
segments, it may lead to problems like control and one
more channels may conflict a
compete for the same customer. The benefits two
customized selling by selling
technically complex products and
of th
this are riefly the steps in the Sales Management Audit.
November 2016
company's technical salesforce and simple low cost servics
vices Discu

increased market coverage, lower channel products through d detailed note on KRA.

personally visiting the customers.

cost by
selling through dealers phone ra
vrite a
lain the purpose ot supervision and control
ther Evplain

7.) Handling Ethical Issues Discuss

ss the distribution pertormance evaluating channels.
Ethical issues
salespeople have are &Explain the instruments of control of channels.
exaggerating the benefits of the product, bribery,
high
misleading the
customers brief note on ethics in sales
pressure sales tactics, Write a management. (Refer Pg. no.
wrong delivery schedules to customers etc. In
today's time the sales
commititing 115)
choice but to ensure ethical
standards from salesforce. manager has
n
business may land up in legal
or Othenwise they will be
in brief, new trends in sales and distribution
November 2016
the necessity to deal with problems. ots
Contemporary sales managers understan to .
bxpla
management.
various groups.
8. Sales Professionalism

In OBJECTIVE QUESTIONS
todays scenario, selling is increased because
-

sophisticated of intense Fill in the Blanks

skills, attitude products and services etc. The competition
customers, technical 1On,
is reflected through
to meet
complex and competitive market knowlede. the revenues that are earned by the business
acquired by professional conditions of end of each financial year. at the
salesperson through training. Some today are
organizations
have their own
training and development centers. A successiul 2. is a
part of leadership, and it includes
money is spent by the
company on training the large amount oi day-to-day activities of salespeople. directing and
controlling of the
professional. salespeople and making them is one of the most
9. E-Selling
those
important tools that
encourage salespeople
activities that will maximize their to carry out
A income or money earned.
company can sell its
products and services online 4 Coordination and
promotional fully functional e-commerce
to if it creates its
website from guidance help improve the .

of salespeople.
passive customers to the operations. E-selling means turning are those factors or
aspects of sales
company's website plan,
salesperson or a company must excel to strategy and implementation
and in which a
Customers. it can
build relation with converting them into active
e-selling company should select company's target audience. For effective is the central factor outperform competitors.
should also use a "secure shopping cart software and services. The or
parameter in an
organization's períormance.
after they make a
server" system and company means the degree
support customers before, to which distribution channels
purchase. during and arkets/segments such as distant
serve
problem
normal or isolated consumer
consumers or markets. pockets along with
-5
complementary to channel operations.
 Eubnetion, Eohis &Tremd
BMS S 12
the atch the columns

and managemert
o inárTnatieNn sastem has
icreased

capabilt
can

e s a i markee ogani2dtrNS B
unekrstand the necessih iwith various
to ceal with various groups
pre

ses managevs a l e s p e r t o r m a n c e

arole model
ANSWERS
b) Orders to sales calls
Sas petormanE 2Supervision compensation plan sales meetings

6. Sales
5. Key result areas
coaching c)shortterm
Channel control 9. Digital marketing indirect supervisory method d secure server

10 Conaemporan e)
key
resuit
areas
operations are on the
right track in
s.
prescribed norms and standards.
. True or Faise
customers to the company's websit
6 Delivery fencourage salespeople to carry out
E-seng means tuming passive site those activities that will maximize
comerting them into active customers.
their income or money earned.
Team buiding aoproach is used when the company wants to build shon
reationship with customers having high sales and profit potential. e-selling 8 financial strength of business
3Fo sell giobally the company need not be large, even small and medium 8. Channel controls h) telecommunication
companies can sell in global niche markets.
9 compensation plan ) sales report
Sales managers need not set code
of ethics to be followed by salespeople in method
organization. 10. Direct supervisory web chats
5Weekiy reports can be short precise showing immediate operational results. ANSWERS
6 Channei controi ensures that operations are on the right track in prescribe (1-g, (2- ), 3 a), (4-i),(5 b), (6- c), (7- d), (8- e), (9 -, (10- h)
-
-

norms and standards.

7. Sales management budget is a
systematic, diagnostic and prescriptive tool i
analyzing reviewing and controlling sales operations or the sales manageme
process.
8. KRAs or
quantitative indicators help to arrive at quantifiable results.
9. Coordination of selling activities of
salespeople in different territories and regiors
is essential for the success of
planning and achievement of sales objectives
targets.
10. compensation pian directs the activities of salespeople, and influences the eftors
and time spent by salespeople on various activities.

ANSWERS
True: 1, 3, 5, 6, 8, 9, 10
False: 2, 4, 7

9T.Y.BM.S.-Sales &Distribution Management (Sem. - V