MIDTERM EXAMINATION

MM 222
(SALES MANAGEMENT)
2ND SEM AY 2021-2022
NAME: ARBY JAY D. GARCIA BSBA 2D-MARKETING
1. What is the difference between investment and capital? Which is more profitable? (20points)

Answer: What is the definition of capital? Anything concrete or intangible that boosts
productivity counts. Machines, buildings, office space, computers, and other tangible capital are
examples. Human capital (how well-trained and educated people are), and social capital are
examples of intangible assets (availability of equal opportunities, etc.).

Investment is the act of putting money into a business with the goal of earning a larger return.
The rewards can be monetary or non-monetary. Spending money to improve the lives of others
is an example of social investment.

Fixed deposits, bonds, and other types of investments are examples of investment.

It's possible that not all investments will result in capital generation right now. Giving a loan to
someone to buy a TV or a car, for example, may not result in capital building in the economy
(though it will fetch you interest income). The commodity purchased with the money will simply
depreciate, not "create" new money or profits for the economy. A loan granted to an
infrastructure company to build a road, on the other hand, could be considered capital
formation because better roads will support other sectors and create jobs. The economy's
productivity will rise now and in the future as a result of the roadways.

Many economists argue that lending money to acquire consumer goods is also an indirect type
of capital development. Purchasing a television, for example, exposes them to media and
information. Better human capital is created as a result of this.

On a side note, this is why, according to pragmatic economic views, we should direct our efforts
toward capital formation rather than consumption.

2. What are the four (4) common sales mistake? (20points).

Answer:

You chase every lead.

Yes, sales is a numbers game to some extent. But you have only so many hours in a day, week,
month, and quarter to sell. If you’re gunning for every lead with no order of priority, your
conversion rates will tank and your morale might well erode because it’s a litany of rejections.

What to do instead:

Follow your organization’s sales qualification process or create one of your own if one doesn’t
exist. Think about the prospects that will most value your value proposition. The more work you
put into qualifying, the more time you free up to pursue those leads that are legitimate
opportunities. Or to put it in an aphorism: Slow down to speed up.
 MIDTERM EXAMINATION
MM 222
(SALES MANAGEMENT)
2ND SEM AY 2021-2022
NAME: ARBY JAY D. GARCIA BSBA 2D-MARKETING

Talking instead of listening.

A conversation is a two-way street. But when you’re feeling the pressure to make a sale, you can
fall into the habit of full-court press and talk too much – including interrupting your buyers and
jumping ahead. There’s a few problems with this: 1) You’re not listening to what your customer
is saying, 2) You’re probably missing key information because you’re too busy yammering, 3)
The buyer might feel unheard because they can’t get a word in, and 4) You could talk your way
out of a deal.

What to do instead:

Bluntly: Shut up. Listen. If you’re still feeling anxious, grab pen and paper and take notes on
what your buyer is saying (a good practice in general, incidentally). Remember this is about the
client – finding out their needs, goals, and problems – and taking the time to think about how
your offerings are solutions to their pain points. Also take a few seconds to think about what
you’re going to say once the buyer is done speaking. It mimics the natural flow of actual
conversation until you’re able to do it instinctively.

Saying yes to everything the buyer wants – no matter how inaccurate or absurd.

No solution can be all things to all people. Even if you’re selling the premium, market leader in
your industry, there’s going to be buyers who simply don’t need your offering. Or perhaps they
need it delivered more quickly than you can provide. Maybe the buyer wants features you don’t
have in your product line.

But saying yes to everything – or its adjacent – being afraid to say no – brings more problems.
First, it makes your offering sound too good to be true and invites skepticism. Second, if you
misspeak or otherwise make an error in your eagerness to say yes, your and your company’s
credibility will be destroyed.

What to do instead:

If there’s something you or your product can’t do, admit it, then offer up an alternative if there
is one. For example, perhaps you can’t deliver the product by the end of the month with your
normal logistical strategy but can at the beginning of the next month and can also offer other
benefits related to their needs. Or perhaps you can expedite it for a nominal additional fee.
 MIDTERM EXAMINATION
MM 222
(SALES MANAGEMENT)
2ND SEM AY 2021-2022
NAME: ARBY JAY D. GARCIA BSBA 2D-MARKETING
Being too easy or quick to cave on pricing or discounts.

Discounts are excellent – but only when used properly and with the right timing. Surrendering
on price early or often puts you in a position where you’re competing on price, not on value. It
also devalues your offering and reduces incentive to purchase – a factor frequently seen in the
gaming industry where there’s a sizable portion of the market that will wait for a sale before
buying rather than purchasing on release date or pre-ordering. Additionally, your initial quote
won’t be taken seriously thereafter because the buyer knows you can be talked down.

What to do instead:

Delay the price conversation as long as you can – emphasize finding out the buyer’s needs and
situation so you can recommend the best and most appropriate solution for them. Above all, sell
on the value. Create enough value for your buyers and the odds of their negotiating over the
price will diminish.

3. What are the three (3) factors of selling psychology? (15points).

Answer:

People don't buy products or services. They buy emotions. A desired feeling. Superiority. Love. Comfort.
Excitement. Security. If you don't know what the emotion is that they are looking to acquire you won't
understand how to sell it.

Emotional states dictate buying (and all other) decisions. Have you ever been in a "shopping rush"? A
state in which you wanted to buy something desperately and it had very little to do with WHAT you're
about to buy? Make sure you pay attention to what emotional states your customers are in before
selling them anything.

Communication is all about tonality and body language and little about content. This is a very old truth
but still surprising to most people. If your lips are saying "Buy!" but your body and voice are
communicating "Don't" you won't win many deals.

4. What are the most three (3) difficult personally in the selling world? (15points).

1. Hard-to-read. Most salespeople would place hard-to-read prospects in the most difficult category.
They give no feedback, so it’s hard to know what they’re thinking. Some salespeople attempt to get a
non-responsive prospect to open up by talking more.

If the prospect is holding back for a specific reason, this can backfire. Here are five strategies to get
these prospects to open up:
 MIDTERM EXAMINATION
MM 222
(SALES MANAGEMENT)
2ND SEM AY 2021-2022
NAME: ARBY JAY D. GARCIA BSBA 2D-MARKETING

Let them know early that they have total control of the call. You can do this simply by asking what issue
they would like to address. You can reduce the chances of the prospect clamming up by having them do
most of the talking.

Ask an open-ended question and then say nothing. The silence may motivate the prospect to supply the
feedback you need. Really listen to the answers. Prospects usually find it flattering to state their
opinions and have someone listen to them.

Get them to talk — about anything. If prospects seem reluctant to talk about their business needs, they
may have a reason. Encouraging them to talk about nonbusiness subjects may get them to open up.

Make the call more interesting for the prospect. Salespeople have to face the fact that some prospects
may find their presentations boring. You can add interest through proper planning.

Try to find out why the prospect isn’t communicating. Some prospects think a poker face is a good
negotiating tool. Others may not know much about your product or service and are afraid of looking
stupid. A good way to handle this situation is to encourage objections and negative feedback.

2. No buying authority. Prospects who meet with salespeople frequently have no buying authority. They
are information gatherers who channel data to the people who do the purchasing. Thinking of them as
insignificant obstacles or going over their heads can backfire on a salesperson. The support of these non-
buyers may play a key role in closing the sale. Try to get them to admit that they’re not the decision
maker. Once this admission is made, the goal shifts from your selling the person in the room directly to
selling the real decision-maker with the help of that person.

3. Indecision. An insecure customer is usually an indecisive customer. Insecure customers need more
attention than regular customers. There are times when every prospect is insecure – the company might
be coming off a bad quarter or a bad year.

Some people have difficulty making decisions even when they know they’re the right ones. That’s what
makes indecisive prospects frustrating to deal with. Your job is to help them make the decision. For
some indecisive prospects, the harder you push, the harder they will resist. It may be better to stop
pushing and start asking questions. It’s usually a good idea to build trust and then ask for the order.

5. How did you handle stress managing your business? (10points)

Answer: Every part of your business has the potential to stress you out and keep you up. Owning a
business is stressful, and you can't really escape it. The sooner you learn small business stress
management, the better. You can improve your stress management in business by reminding yourself of
the things that are going right. List out all your accomplishments and any small business milestones
 MIDTERM EXAMINATION
MM 222
(SALES MANAGEMENT)
2ND SEM AY 2021-2022
NAME: ARBY JAY D. GARCIA BSBA 2D-MARKETING
you've achieved. There are probably more than you realize. Don't neglect even the smallest
accomplishments.