GIBS SALES MANAGEMENT BBA

CHAPTER-1 INTRODUCTION TO SALES MANAGEMENT

• Sales management is defined as the planning, direction, and control of personal

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

• Sales management specifically contributes to achieve the marketing objectives of a

firm.

ELEMENTS OF SALES MANAGEMENT

(1) Planning:

• A business cannot be taken as a chance. Every step has to be taken after a proper
planning.

• The plan should also be evaluated, after investigating the total-market, for a
particular type of product.

• Flexibility must be provided by establishing a specialists production line, to allow

for variation in production.

• The plan should also be reviewed continuously.

• The details of the plan should be discussed, with all the departmental heads & their
sub-ordinates, who bear responsibility for fulfilling the plan

(2) Co-ordination:

• It helps in the maximization of utilization of human-effort by the exercise of

effective leadership, guidance, motivation, supervision, communication etc.

• No personal problems, arising from business-operations are to be ignored, but

solved through a free-exchange of ideas.

(3) Controlling:

• The sales manager has to check regularly, that the sales activities are moving in the
right direction or not.

• He guides, leads, and motivates the subordinates, so as to achieve the goals planned
for the business.

The control-system has to

(i) prepare sales and market forecasts;

(ii) determine the level of sales-budget;

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GIBS SALES MANAGEMENT BBA

(iii) determine the sales-quotas for each salesman;

(iv) determine, review and select distribution-channels;

(v) organise an efficient sales force;

(vi) establish a system of sales-reporting;

(vii) establish a system of statistical sales-credit;

(viii) establish stockcontrol system(s);

(ix) review of performance of the salesforce; and

(x) establish periodical testing programmes.

(4) Motivating:

Motivation is essentially a human resource concept. It aims to weld together distinctive

personalities into an efficient team.

For this, knowledge of human psychology is needed. This is especially important in the
case of the sales-force because only motivated sales-persons can achieve company’s goals.

NEED AND IMPOTANCE

(i) To enable the top-management, to devote more time in policy making for the
growth and expansion of business.

(ii) To divide and fix authority among the sub-ordinates so that they may shirk
work.

(iii) To avoid repetition of duties and functions so that there may not be any
confusion among them.

(iv) To locate responsibility of each and every employee so that they can complete
the whole work in stipulated time.

(v) To establish the sales-routine in the business unit.

(vi) To stimulate sales-effort.

OBJECTIVES OF SALES MANAGEMENT

1. Revenue Generation – The sales department is solely responsible to bring in the
money.

2. Increase Sales Volume – Through efficient sales management, the organization

wishes to increase the number of units sold.

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GIBS SALES MANAGEMENT BBA

3. Sustained Profits – It has to improve the profits of the organization by increasing

sales of company.

4. Organization Growth – With the continuous sales management techniques, the

organization tends to gain market share and results in growth of the organization.

5. Market Leadership – With increased sales volumes and profits, ‘sales

management’ enables an organization to become the market leader.

6. Motivate the Sales Force – One of the core objectives of sales management is to
motivate the sales force. Selling is a very stressful task; achieving sales targets can
become very challenging. Therefore, the sales management task is to ensure that the
sales force is continuously motivated through proper incentives and reward
systems.

SALES MANAGEMENT STRATEGIES

 Identify goals and objectives of the sales team- Be clear on your sales targets.
Make sure the targets are realistic and achievable. Also assign a fixed timeline to
achieve the targets.
 Know your product well. Understand what benefits end-users would get from
your brand- The marketers must interact with customers to find out more about
their expectations from the product as well as the organization. One would not be
able to convince the customers unless and until he himself is clear with the benefits
of the products.
 Identify your target market- Selling techniques and strategies can’t be same for all
individuals. Each audience has different needs, interests and requirements.
 Hire the right individual for the sales team- Remember the sales professionals
have a major role in the success and failure of organizations. Recruit individuals who
are aggressive, out of the box thinkers and nurture the dream of making it big in the
corporate world. Make the sales representatives very clear about their roles and
responsibilities in the team. Develop a lucrative incentive plan for them. Incentives
and monetary benefits go a long way in motivating the sales team.
 Don’t lie to your customers. It is important to maintain transparency-
Communicate what your entire product actually offers. It is unethical to make false
promises. Only commit to what you actually can deliver to customers.
 Know what your competitors are offering- It is essential to do a SWOT analysis of
your organization to know its strengths, weaknesses, threats and opportunities. A
marketer must know how his product is better than his competitors.
 Sales representatives must do their homework before going for a sales call-
One should never go unprepared. Remember the customer can ask you anything and
you have to be ready with your answers. The management must promote training
sessions at the workplace to upgrade the skills of the sales professionals and expect
them to deliver their level best.
 Devise strategies as per the target audience- Know your market well. The
individuals must be able to relate to your products. The strategies must be

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GIBS SALES MANAGEMENT BBA

formulated in the presence of all. Each one should have a say in the same. Let
everyone come out with his suggestions. Be ready with alternate plans if one plan
fails.
 The management must conduct frequent meetings with the sales team to
review their performances- Keep a track on their daily activities. The sales team
must prepare Daily Sales Reports (DSR) for the superiors to know what they are up
to.
 One must assess his own performance- Recall your interactions with the clients
and analyze where you went wrong and where things could have been a little better.
 Treat your customers well for higher customer satisfaction and retention-
Don’t oversell. Once you are through with your sales presentation, don’t be after
your client’s life. Give him time to think and decide.
SALES CYCLE
Sales cycle refers to the various processes which help the products reach the end users.
Customers go through a sequence of activities before the product finally reaches them.
Such activities are a part of the sales cycle.

A sales cycle has the following steps:

Identifying Prospects

1. The first step in the sales cycle is to make a list of potential customers.
2. Try to gather as much data as you can. Ask your team members to visit markets,
shopping malls, restaurants to map potential customers and collect information
about them
3. Placing canopies at strategic locations also invite potential customers.
4. A sales professional should ideally spend his maximum time outside office meeting
people. Interact with as many individuals as you can.
5. Distribute questionnaires amongst the potential customers to know them better.

Setting Appointments

6. The next step is to make the people aware of your product and its offerings.
7. Try to get in touch with the people. Call them and seek an appointment.
8. Don’t arrange meetings at your convenience.
9. Take his address and courier relevant information brochures beforehand for him to
know more about your product and its benefits.
10. Marketers also depend on cold calls to inform the customers about their products
and services. Don’t be after the individual’s life to fix an appointment.
11. Do take care of your pitch while speaking over the phone. Make your speech
interesting. Don’t drag conversations.

Know Your Customer Well

12. It really helps if you know something about your client before meeting him.

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GIBS SALES MANAGEMENT BBA

13. Try to gain some information about him from social networking sites like facebook,
orkut, linked in, twitter and so on. These networking sites do give some information
about the client which definitely helps in preparing the sales pitch.
14. Understand the customer’s needs and expectations from the product. Check
whether the customer has the potential to purchase a particular product or not.
There is no point selling an air-conditioner to someone whose monthly income is Rs
10000/-. Find out more about the background of the customer.

Determine Client’s Solution

15. Suggest the right option for the customers. A sales representative must never lie to
the customers. Say what your product actually offers.
16. It is unprofessional to make false commitments. Sit with the customer and help him
with the best solutions. Don’t always think about your own targets and incentives.
Think from the customer’s perspective as well. Don’t prompt him to buy something
which you yourself feel is not right for him.

Written Proposal/Document

17. Once the customer decides on the product, present a proposal to him with the
proposed rates and other necessary terms and conditions.

Negotiation Round

18. There should always be room for negotiation in deals. Don’t be too rigid. Negotiate
with an open mind.
19. The customers should be aware of even the minutest details. For higher customer
satisfaction, give him the best deal.
20. A sales professional should always aim to close the deal as soon as both the parties
accept the terms and conditions.

After Sales Service

21. Make sure customers are satisfied with your service.

22. Find out whether all his demands are fulfilled or not.
23. Be in touch with him even after the deal is over.

EMERGING TRENDS IN SALES MANAGEMENT

Global Perspective

Global competition is intensifying. Domestic companies who never thought about foreign
competitors are suddenly finding them in their backyard. This is a challenge which sales
managers and salesperson must take on, they have to improve their personal selling efforts
not only in their countries but also in foreign countries. Selling goods and services in global
markets presents a challenge due to differences in culture, language, needs and
requirements.

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GIBS SALES MANAGEMENT BBA

Technological Revolution

Digital revolution and management information system have greatly increased the
capabilities of consumers and marketing organizations. Consumer today can get
information about products, compare it with other brand, place an order and place an
order instantly over the internet. This has led to a different kind of sales force who collects
information about internet users, markets and prospects of internet buyers. It is mandatory
for all companies to have their website now.

To compete effectively, sales person and managers will have to adopt the latest technology.

Customer Relationship Management [CRM]

Combining information technology with relationship marketing has resulted in customer

relationship management. Interestingly, the concept of relationship marketing came about
earlier by bringing quality, customer service and marketing together.

Relationship marketing aims in building long term satisfying relations with key customers
distributors and suppliers in order to earn and retain their long term preference and
business. CRM enable companies to provide excellent real-time service by focusing on
meeting the individual needs of each valued customer, through the use of CRM software
packages.

Sales Force Diversity

The demographic characteristics of sales force is changing and becoming more varied. For
example, more and more women are taking up careers in sales management and selling.
Also the education level of sales people is going up most of them holding a college degree or
a post graduate degree. Sales managers now have to handle a sales force of these varied
demographic, expectations of each and every individual is different and sales manager
needs to use different motivational tools against each one of them.

Team Selling Approach

The practice of team selling is more widely followed by most companies in recent years.
Team selling approach is used when company wants to build a long term mutually
beneficial relationship with major customers, who have high sales and profitable potential.
It is used for selling a technically complex product or a service to a potential customer. The
composition of team may vary depending upon the customer from top management,
technical specialist, customer service, etc…

Managing Multi-Channels

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GIBS SALES MANAGEMENT BBA

Multi-channel marketing system occurs when organization uses two or more marketing
channels to target one or more customer segments. Major benefits of multi-channel
marketing system are:

Lower channel cost

Increased market coverage

Customized selling

Multi-channel may also lead to conflicts and control problems, as two or more channels
may compete for same customer. A successful sales manager will have to effectively
manage conflict between the channels.

Ethical and Social Issues

Sales managers have ethical and social responsibilities. Sales people face ethical issues such
as bribery, deception (or misleading) and high pressure sales tactics. Today’s sales
managers have no choice but to ensure ethical standards from sales force otherwise they
may be out of business or even land up in legal problems.

Below diagram gives the changing trends in Sales Management

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