Management of the Sales Force

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Chapter-01

Managing the Sales Force


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Objectives Designing a Sales Force


Principles of Personal Selling


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What is Personal Selling or

Salesmanship?It involves direct and personal contact of the seller or

his representative with the prospective buyer. It is

face to face oral communication with the potentialbuyers. It is the act of convincing or persuading. It isbeneficial to both the sellers and the buyers

.


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Types of Sales representative Order taker

Deliver

Missionary

Solution vendor


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Importance of Personal Selling Benefits to Consumers

Benefits to Businessmen

Benefits to Society


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The Role of the Sales Force

Sales ForceServes as a Critical Link

Between a Company and its Customers Since They:

Represent Customers tothe Company to Produce

Customer Satisfaction

Represent the Companyto Customers to Produce

Company Profit


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Essential Elements of Personal

Selling Element of Persuation

Element of Creativity

Element of Education

Element of Mutual Benefits


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Qualities of a Successful

Salesman Knowledge about the product

Knowledge about the customers

Knowledge about the techniques ofselling

Personal qualities


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Qualities of a Successful

Salesman ( cont.) Personal qualities

a) Personality ( appearance, tastes and good habits)b) Mental Qualities ( intelligence, presence of mind, imagination, confidence,

observation, sharp memory)

a) Social Qualities ( Co-operative, well mannered )

b) Character qualities ( honesty, integrity, loyalty)


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When might you decide to use

Personal Selling?

Concentrated Market Few buyers High value product

Product must be customized

Must demonstrate product


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Designing the Sales forceSales force objectives

Sales force strategy

Sales force structure

Sales force size

Sales force compensation


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Sales Force ObjectivesMy Selling Purpose

Is to help people get the good feelingsthey want about what they bought and

about themselves


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Sales Force Objectives

Common objectives for salespeople

Prospecting

Targeting Communicating

Selling

Information gatheringAllocating

Long-term relationship


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Sales Force Strategy

Full Time

Part Time

Inside sales people

Outside sales people


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Sales Force Structures


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Territorial/Geographical Structure:

Each sales rep is assigned an exclusive territory.

Advantages:

Lowest possible costs because of lower travel time & low administrationexpenses

Clarity in who is responsible for whom; one salesperson for one customer

Disadvantages:

Salesperson has to sell the whole product line

Perhaps too much attention to easy-to-sell products


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Product Structure:

Each sales rep is completely responsible for one product or product line.

Product specialization is particularly warranted where the product are

technically complex, highly unrelated, or very numerous.

Advantages:

Better control of selling effort

Salespeople start to be experts in the products and needed selling processes

Disadvantages:

High traveling costs

Duplication of calls & selling effort


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Customer Structure:

Firms salesperson are often specialize along industry or customer lines.

Advantages:

Better understanding of customers needs

Better allocation of marketing & selling effort due to customers ranking

Disadvantages:

Higher costs related with extensive travel

Duplication of calls & selling effort


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Sales Force Size

Classify customers by size

Determine desirable call frequencies

Determine total sales calls needed per year

Determine average number of sales calls per

sales representative per year

Divide total by number per rep

Workload Approach


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MCQ

Suppose a company calls on 3,000 small accounts,2,000 medium accounts, and 500 large accounts eachyear. Small accounts warrant one call every 3 months,medium accounts every 2 months, and large accountsmonthly. If each sales people able to make 600 calls a year, thencompany wants to have no more than ______ salespeople 60 50 40 70


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Sales force SizeWorkload Method-Most Popular:

1. Classification all the firms customers into categories often based on the level of sales

Type A: Large in term of sales or very attractive 200

Type B: Medium in term of sales or moderately attractive 350

Type C: Small in term of sales but attractive 480

Type D: neither attractive in term of sales nor at respect of profitability the rest of firms customer

2. Determination the frequency with which type of account should be called upon & the desired length of each call

Type A: 26 times/year x 60 minutes = 1560 minutes = 26 H

Type B: 12 times/year x 30 minutes = 360 minutes = 6 H

Type C: 6 times/year x 20 minutes = 120 minutes = 2H

3. Calculation the work load involved in covering the entire market

Type A: 200 accounts x 26 H = 5200 H

Type B: 350 accounts x 6 H = 2100 H

Type C: 480 accounts x 2 H = 960 H

Total: 8260 H


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Sales force Size

4. Determination the time available per average salesperson by year:

40 hours/week x 44 weeks per year = 1760 H/per year

Type A: 26 times/year x 60 minutes = 1560 minutes = 26 H

Type B: 12 times/year x 30 minutes = 360 minutes = 6 H

Type C: 6 times/year x 20 minutes = 120 minutes = 2H

5. Apportion of salespersons time by tasks performed

Selling duties = 40% = 704 H

Non selling duties = 30% = 528 H

Traveling = 30% = 528 H

Total: =100% = 1760 H

6. Calculation of the number of salespeople needed

8260/704 = 11,73 = 12 salespeople


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Sales Force Compensation

Determining general level of compensation:

It is generally agreed that companies and industries with low average levelsof compensation tend to suffer high turnover rates. Therefore, it isnecessary that the general level of compensation be sufficientlycompetitive to attract and retain competent salespeople.

The most important factors determining average level of pay for a salesforce are following:

The skills, experience, and education required to do the work successfully;

The level of income for comparable job in the company;

The level of income for comparable jobs in the industry (that is, thecompetitive environment);

Living costs


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Basic compensation plan:

Straight salary: the person receives a fixed amount of money at fixedintervals, such as weekly or monthly.

Straight commission: the person receives an amount that varies with results,usually sales or profits.

Bonus payments: a lump sum of money or stock for some exceptionalperformance, such as making quota, obtaining a new customer account orselling a desired products mix. Bonuses may be paid for individual performanceor group achievement. Usually companied pay bonuses annually, however thereare some companies that pay incentive earnings on a semiannual, quarterly or

even monthly basis.


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Basic compensation plan:

Fringe benefits: there are a host of fringe benefits that companies mayconsider using to reward high-performing executives. Although most are

reserved for top-level management, fringes such as a company car & stockoptions are frequently available to the sales force.

Combination: the person receives a mix of salary, commission, and / orbonus.

Sales contests; sales force contests are short-term incentive programs thatuses prizes an awards to motivate sales reps to achieve goals specified by

management. Contests are a popular motivational device.


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Managing the Sales force

Recruiting & selecting salesrepresentatives

Training sales representatives

Supervising sales representatives

Motivating sales representatives

Evaluating sales representatives


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Recruiting Sales people

Recruitment is finding potential job applicants, telling them about the

company, and getting them to apply.

Recruiting efforts should not simply generate applicants; rather, it

should finds applicants who are potentially good salespeople.

The entire sales organization ultimately depends on successful

recruiting approach.


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Need for recruitment

To replace the vacancy created

To cope up with expansion program


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Recruiting Sales peopleSources of Candidates

Company sources

Company salespeople

Suppliers and customers Professional associations

Local business and civic organizations

Government agencies

Armed forces

Job fairs

Unsolicited applicants

Advertisements

Employment Agencies

Educational Institutions


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Selecting Salespeople

Why selection is so important?

Good selection improve sales force performance

Good selection promotes cost savings

Good selection eases other managerial tasks


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General Qualities ( Health, Honesty, Imagination, Creativity)

Particular Qualities ( Educational Qualifications, Past Experience)

Technical Qualities


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SelectionProcessUsually

Evaluatesa Persons

Other Characteristics

Personality Traits

Sales Aptitude

Analytical and

Organizational Skills


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Supervising Salespeople

Identify Customer Targets & CallNorms

Develop Prospect Target

Use Sales Time Efficiently

Annual Call Plan

Time-and-Duty Analysis

Sales Force Automation


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Time and Duty Analysis

Preparation

Travel

Food & Breaks

Waiting

Selling

Administration


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Sales Representative Motivation

Organizational Climate

Sales Quotas Positive Incentives

Sales Meetings

Sales Contests

Honors and Trips

Merchandise/ Cash


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Evaluating Salespeople

Sources of

Information

AnnualTerritory

Marketing Plan

Work

Plan

CallReports


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Performance Evaluation

Current-to-Past

Customer Satisfaction

Qualitative Evaluation


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Steps in the selling Process

The Selling Process

Closing Follow up

PresentationProspecting Preparing

Handlingobjections


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Step 1. Prospecting andQualifying

Identifying and Screening ForQualified Potential Customers.

Learning As Much As PossibleAbout a Prospective Customer

Before Making a Sales Call.

Step 2. Pre-approach

Step 3. Approach

Knowing How to Meet the Buyer

to Get the Relationship Offto a Good Start.

Step 4. Presentation/Demonstration

Telling the Product Story

to the Buyer, and Showing the

Product Benefits.



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Step 5. Handling Objections

Step 6. Closing

Step 7. Follow-Up

Seeking Out, Clarifying,and Overcoming

Customer Objections toBuying.

Asking the Customerfor the Order.

Following Up After the Sale toEnsure Customer Satisfaction

and Repeat Business.



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Review

Designing a Sales Force


Principles of Personal Selling

Management of the Sales Force

Documents

Transcript of Management of the Sales Force