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Efficiency of Sales Logistics in Ow
Efficiency of Sales Logistics in Ow
Efficiency of Sales Logistics in Ow
ABSTRACT. Background: Sales plays an important and simultaneously specific role in an organization's logistics
system. It can be pointed out that it is the connective tissue between the supply and distribution subsystems of a business
entity. Sales logistics encompasses all the activities whose core tenet is to provide the customer with the ordered product
within the required time, at a satisfactory cost and quality. Additionally, it should be pointed out that sales networks in
the telecommunications industry are actively involved especially in distribution. There are three types of sales networks
in telecommunications companies. These are own sales networks, partner sales networks - also called external or
dealerships, and mixed networks - where both previously enumerated solutions work simultaneously. The conditions for
the proper functioning of own and partner sales networks differ significantly in terms of both the formal-legal side and
remuneration. The purpose of the article is to analyze the impact of using sales network partners on the effectiveness of
sales logistics.
Methods: The comparative analysis dealt with four entities constituting the telecommunications industry in Poland,
considering such parameters as: number of employees, average number of activations per employee, average cost per one
employee, average income per one employee, sales profitability, The analysis period covered the years in which the
surveyed entities used own and partner sales networks in parallel (1999-2016).
Results: When comparing the functioning of own and partner sales networks based on the studied parameters, it should
be noted that the latter is characterized by a much higher number of employees (by 73.19%). Besides, the profitability of
sales in the partner network is much higher than in the case of own network - by 141.69 percentage points.
Conclusions: Partner sales networks are characterized by a higher average sales value and profitability than own
networks. At the same time, there are a larger number of employees employed in partner sales networks. It should be
noted that in respect of market penetration and income generation by organizations, this solution is more advantageous.
The added value of the research is determining the level of sales logistics effectiveness of own and partner sales networks
in terms of the telecommunications industry.
Key words: sales logistics, comparative analysis of sales networks, telecommunications industry, sales effectiveness of
own and partner networks.
Sales logistics is an area covering all the When looking at a slightly broader
activities whose basic assumption is to deliver approach related to the entire supply chain of
the ordered goods to the customer within the the telecommunications market, in terms of
time set by him. In this aspect, it is vital to phases it consists of a supply (suppliers), sales
maintain a rational cost, and even minimize it (telecommunications operators, sales
as in the case of intensifying competitive fights networks) and distribution (sales networks,
courier companies). The supply concerns
entities providing products offered by
Copyright: Wyższa Szkoła Logistyki, Poznań, Polska
Citation: Brzeziński Ł., Cyplik P., 2020. Efficiency of sales logistics in own and partner networks. LogForum 16 (1), 117-127
http://doi.org/10.17270/J.LOG.2020.343
Received: 12.03.2019, Accepted: 08.11.2019, on-line: 30.12.2019.
,
Brzeziński Ł., Cyplik P., 2020. Efficiency of sales logistics in own and partner networks. LogForum 16 (1), 117-
127. http://doi.org/10.17270/J.LOG.2020.343
Distribution logistics is the total of actions Cooperation has always existed in the
taken to achieve effective product movement economy resulting from the adopted tactics of
from the end of the process on the production the enterprise or operational needs.
line to the consumer. It covers all tasks related Contemporary cooperation relations are
to supplying the customer with products developed and supported by technology. They
directly from production, from sales now penetrate life so strongly that the
warehouses or possibly from other regional metaphor of the network becomes ubiquitous,
shipping centres. Typically, this stage of flows and the characteristics describing the
already concerns final products, but examples connections indicate that it is global
of different situations include the takeover by a [Bengtsson, Kock, 2000, Agndal, Nilsson
specialized logistics distribution service 2009; da Mota Pedrosa, Blazevic, Jasmand,
provider along with the previous final 2015].
assembly of the product adapting its features to
the needs of the final recipient [Jazairy, The creation of network forms of sales
Lenhardt, von Haartman, 2017]. processes results from the search for new
forms of task implementation. Important
When taking appropriate actions to place features of networking include: goal - creating
goods at the buyer's disposal, it is necessary to a sense of identity that allows effective
take into account, above all, his expectations, management of resources, participants, their
especially in terms of quantity and quality of activities in a way that enables the
products, delivery times and the scope of after- implementation of the assumed strategy; high
sales services, as well as the division of tasks degree of specialization; network structure
related to the flow of goods between the often determined depending on the goal or
supplier and the recipient. The development of problem being solved; coordination based on
service standards plays an important role in self-organization, problem solving, employee
this respect. involvement; spontaneity [Peterson,
Zimmerman 2004]; low formalization - few
Distribution stands for all the activities written rules, information flow through the
related to the movement of materials, usually network of connections, knowledge resources
products and components for the needs of the perceived as a common good, available to
service, from the producer to the consumer. everyone [Hadas, Stachowiak, Cyplik, 2011;
These include transport, storage, inventory Oláh,Karmazin, Pető, Popp, 2018].
management, material handling, order
processing, location analysis, packaging The development of network forms means
management, information processing and that new forms of work organization are used.
communication necessary for effective An employee can be used to create value in an
coordination of all activities [Thompson, enterprise. In sales networks, employees
Richardson 1996, Lechner, Dowling, Welpe, increasingly have a relatively wide range of
2006, Gino, Melacini, Sassi, Tappia 2017]. rights and responsibilities. The model of self-
managing teams and time forms - e.g. task-
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Brzeziński Ł., Cyplik P., 2020. Efficiency of sales logistics in own and partner networks. LogForum 16 (1), 117-
127. http://doi.org/10.17270/J.LOG.2020.343
based (e.g. partner sales networks) is becoming providing support for employees in the form of
more common [Hakansson, Havila, Pedersen IT tools, allocation of material resources in the
2000, Cachon, Swinney, 2009, Metcalfe 2010, form of e.g. offices and their equipment. Also,
Manuj, Sahin, 2011, Tereyaǧoǧlu, Veerara- the distribution of structures in the area
ghavan, 2012, Wudhikarn, Chakpitak, covered by sales activities should be based on
Neubert, 2018, Solakivi, Hofmann, Töyli, current needs and market trends [Davis-Blake,
Ojala 2018]. Broschak 2009, Smith 2015].
119
,
Brzeziński Ł., Cyplik P., 2020. Efficiency of sales logistics in own and partner networks. LogForum 16 (1), 117-
127. http://doi.org/10.17270/J.LOG.2020.343
company. The concept, scope and purpose of establishes cooperation based on commercial
outsourcing have changed over time. Initially, contracts (cooperation agreements) with
it was a way to reduce costs, then the partners who are to implement the processes of
possibility of reducing exposure to the risk of selling products and services for the parent
technological changes, reducing the scope of enterprise. The partners, in turn, further shape
operations, as well as a strategic orientation. their own sales structures. Operating costs
Therefore, outsourcing can be considered the result from the workload of tasks. Therefore,
initial element based on which subsequent the remuneration for the provision of sales
elements were created [Davis-Blake, Broschak processes to the parent enterprise by the
2009, Smith 2015]. partner is based on the commission, which is
specified in the contract. This is due to the
The Alliance is a union of several allocation of tasks between individual entities.
enterprises that are competitors and operate on Similar relationships occur between the partner
the same market, usually of a long-term nature, and sales representatives employed in the
whose goal is to implement a joint venture. In partner sales network. All operating costs are
comparison to typical cooperation relations "passed on" to sales representatives.
between enterprises, strategic alliances are
distinguished by a broader scope that may Own and partner sales networks, despite
apply to the entire market, and potential a certain convergence in the very purpose of
directions of activity, a small number of their operation, which can be synthetically
partners [Dziaduch, Knokol 2009]. Contracting described as the highest possible efficiency of
- instead of an employment contract, an sales processes, in the very operation and
agreement is concluded between the integration into the company structure differ
cooperating entities under which the terms of significantly. Therefore, it seems reasonable to
cooperation are established. Cooperation is the compare them.
cooperation of many entities aimed at
achieving a common goal, and individual Common features and differences between
entities mutually support each other in own sales networks and partner sales networks
achieving it. This applies to cooperation, e.g. will be compiled in the following categories:
in the provision of services, i.e. the scope employees, sales plans, organization, costs,
covers all types of relationships between salaries, entitlements and responsibility, assets,
enterprises. Cooperation stands out in relation and control and supervision. The comparison is
to outsourcing: joint implementation of partial presented in Table 1.
tasks, the contractual nature of cooperation,
freedom in determining the form of The main difference between the two types
cooperation. Partnering is associated with the of sales network considered here is the contract
identification of mutual relations between the with a sales representative, based on which
customer and the supplier as a result of which employees are employed. In the case of own
both parties gain benefits. Partnering is sales networks, this is an employment contract
focused on developing high-quality contacts (in principle), while partner networks have
with the recipient of products or services. In cooperation agreements (which is a reference
a sense, this concept is synonymous with to contracting). The differences are also
outsourcing, but in this approach, the most manifested in the organization because own
important are relations between partners. sales networks are included in the structures of
Shared resources concern the joint use of the leading enterprise. The partner network has
enterprise infrastructure, e.g. computer no such connection, the only link is the person
network, provision of computer programs, of the director of the partner network who is
data, mass storage devices, printers [Inkpen, employed in the contracting enterprise. Own
Tank 2005, Davis-Blake, Broschak 2009, networks are characterized by significantly
Smith 2015]. higher operating costs. In partner networks,
remuneration is based on commission, if the
Entities forming a partner sales network are people employed there will not finalize sales
enterprises. Thus, the leading entity - the transactions, there will be no basis for payment
parent enterprise (forming the network) for the work done. In the case of their own
120
Brzeziński Ł., Cyplik P., 2020. Efficiency of sales logistics in own and partner networks. LogForum 16 (1), 117-
127. http://doi.org/10.17270/J.LOG.2020.343
121
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Brzeziński Ł., Cyplik P., 2020. Efficiency of sales logistics in own and partner networks. LogForum 16 (1), 117-
127. http://doi.org/10.17270/J.LOG.2020.343
in Poland. Based on the data from the Office of The effectiveness was analysed based on
Electronic Communications, it can be values: number of employees, average number
concluded that in 2015, 23 business entities of activations per employee (activation of the
operated on the telecommunications market in customer's SIM card in the
Poland. However, only four entities meet the telecommunications network of the
following criteria: telecommunications operator), average cost per
− enterprises operate on the territory of the one employee, average income per one
Republic of Poland employee, sales profitability.
− enterprises operate in the mobile telephony
segment in particular, Variables selected in this way, used in the
− enterprises covered by the survey use operation, perform sales logistics effectiveness
partner networks, assessments. On the one hand, they include the
− partner networks operate on behalf of cost side. In the case of employees belonging
enterprises in the telecommunications to the sales network, gross remuneration, costs
industry in Poland realize sales both on the associated with reaching the customer and the
business market and the individual costs of providing telecommunications
customer market (sales to other natural equipment, as well as the revenues generated
persons), by these employees (average number of
− enterprises offer post-paid services, i.e. activations based on). In turn, in the case of
subscription services. partners in the sales network, costs related to
the payment of commission are included. It is
The research activities undertaken were also irrelevant to indicate the number of
utilitarian and in particular, referred to employees to indicate the scale of activity. On
business practice. The research assumption this basis, you can assess the logistics
was to confront the effectiveness of sales efficiency and compare the effectiveness of
logistics obtained by own and partner sales sales logistics.
networks in the telecommunications industry
in Poland. The leading research method was
comparative analysis, which services identify
The purpose of the article is to analyze the the type of elements forming a given whole
impact of using sales network partners on the based on their features and assess the
effectiveness of sales Logistics. efficiency of the whole functioning against the
background of the adopted pattern. The
On this basis, the following research comparative analysis concerns a specific
problems were formulated: object, which is usually complex and differs
from others, therefore it is a set of its proper
features with different potential information.
Are partner sales networks more efficient
The study of complex objects or phenomena
than own sales networks (in terms of sales
means that comparative analysis has many
logistics)?
dimensions [Reynolds 2000, Zimmerman and
Szenberg 2000].
P1: What is the average cost per employee in
own and partner networks?
COMPARATIVE ANALYSIS OF
P2: What is the average income per employee
SALES LOGISTICS EFFICIENCY OF
in own and partner networks?
TELECOMMUNICATIONS
P3: What is the average number of activations
ENTERPRISES IN POLAND
per employee in own and partner
networks? The following entities will be subject to
comparative analysis: Enterprise A, Enterprise
B, Enterprise C, Enterprise D.
P4: What is the profitability of sales logistics
of own and partner sales networks?
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Brzeziński Ł., Cyplik P., 2020. Efficiency of sales logistics in own and partner networks. LogForum 16 (1), 117-
127. http://doi.org/10.17270/J.LOG.2020.343
Enterprise A has been using partner relation to employees of the partner network, it
networks since 2008 when it employed 33 is the cost of commission and possible bonuses
people in its own sales network and 70 in the for obtaining high sales results. The average
partner sales network. In 2016, 956 people income per employee is the inflow of funds
were employed in the enterprise, whose daily resulting from all activations. These are
duties were directly related to sales in their subscription services, i.e. the customer bears
own sales network (showrooms and sales the monthly costs of using a specific SIM card,
representatives), and 1356 people in the plus one-time activations and the purchase of
partner network. It is worth noting that until additional paid services.
2012 there was a significant increase in sales
and employment outlets in both own and The average number of employees of own
partner networks. In subsequent years, there sales network in all enterprises covered by the
was a systematic decrease in the number of survey was 877.00 (median 887.00). The
showrooms and employment in both types of average number of activations sold by one
sales networks. employee was 148.47. The average employer's
cost per employee was PLN 90,575.70. The
Enterprise B has been using partner average income per employee was PLN
networks since 1999. In 2016, the total number 19,118.10. The profitability of sales was at
of employees of the own network was 665. 125.12%.
However, in the case of the partner network, it
was 1340 people. The number of own The average number of employees of the
showrooms in 2016 was 220, and there were partner networks of all the analysed enterprises
530 in the partner network. Also, the number was 1517.00 people, besides, the average sales
of sales representatives in the partner network of activations per employee were 176.56. The
in 2016 was much higher (420 people) than in average cost of one employee was PLN
the case of own sales network (225 people). 62,744.46, and the average income per
employee was PLN 22,702.10. Sales
Enterprise C launched a partner sales profitability was 266.71% (Table 9).
network in 2001. This entity has the most
extensive sales structures compared to Comparing the calculated parameters for
enterprises A, B and D. In 2016, there were own and partner sales networks, it should be
270 own and 850 partner showrooms. The total noted that the latter employs significantly more
number of employees in the own network was employees (by 73.19%). Concerning the
1000 and the partner network 2130. average number of activations in the annual
average, the employees of the partner network
Enterprise D launched a partner sales sold 18.92% more. Costs per employee in the
network in 2002. In the same year, 200 content network were 30.73% lower than in the
employees were employed in their own sales case of the own network. The average revenue
network. In 2016, this number was 1095. 190 per employee of the partner network was
people were employed in the partner network higher by 18.91% compared to own sales
in 2002, and in 2016, 950. networks. The profitability of sales in the
content network was much higher than in the
The analyses carried out were based on case of own network - by 141.69 percentage
three main values: the average annual number points. A comparison of the values of own and
of activations per employee (activation of the partner networks is presented in Table 2.
customer's SIM card in the
telecommunications network of the Summing up the analysis carried out in
telecommunications operator), then the terms of the average number of activations per
average annual cost per employee, which in the employee, average income and cost per
case of employees of the own network consists employee and sales profitability, in each of the
of remuneration with mark-ups, bonuses, examined elements the partner networks
business trips, fuel costs, the purchase of a car achieved better results.
fleet, business phones, business laptops and
other items necessary for work. However, in
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Brzeziński Ł., Cyplik P., 2020. Efficiency of sales logistics in own and partner networks. LogForum 16 (1), 117-
127. http://doi.org/10.17270/J.LOG.2020.343
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Brzeziński Ł., Cyplik P., 2020. Efficiency of sales logistics in own and partner networks. LogForum 16 (1), 117-
127. http://doi.org/10.17270/J.LOG.2020.343
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Słowa kluczowe: logistyka sprzedaży, analiza porównawcza sieci sprzedaży, branża telekomunikacyjna, efektywność
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