Sales And Distribution Management 875s

Chapter 1

Introduction to Sales and Distribution Management

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Learning Objectives • To understand evolution, nature and importance of sales management • To know role and skills of modern sales managers • To understand types of sales managers • To learn objectives, strategies and tactics of sales management • To know emerging trends in sales management • To understand linkage between sales and distribution management 2

Evolution, Nature and Importance of Sales Management Evolution of Sales Management • Situation before industrial revolution in U.K. (1760AD) • Situation after industrial revolutions in U.K., and U.S.A. • Marketing function splits into sales and other functions like market research, advertising, physical distribution

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What is Sales Management? • One definition: “The management of the personal selling part of a company’s marketing function.” • Another definition: “The process of planning, directing, and controlling of personal selling, including recruiting, selecting, equipping, asg, supervising, paying, and motivating the personal sales force.

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Nature of Sales Management • Its integration with marketing management Hearketing

ManagerPromotion

Manager – Market Research

Manager – Sales

Manager – Market Logistics

Manager – Customer Service

• Relationship Selling Transactional Relationship Selling

Value – added Collaborative / Relationship / Partnering Selling Relationship Selling

/ /

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• Varying Sales Responsibilities / Positions / Jobs Sales Position

Brief Description

Examples

• Delivery salesperson

• Delivery of products to business • Milk, newspapers to households customers or households. • Also takes orders. • Soft drinks, bread to retail stores.

• Order taker (Response selling)

• Inside order taker

• Sales • Technical selling

• Provide information, build • Medical reps. in pharma industry goodwill, introduce new products • Technical information, assistance • Steel, Chemical industries

• Behind counter in a garment shop • Telemarketing salesperson takes • Pharma products’ orders from orders over telephone nursing homes • Outside order taker. Also • Food, clothing products’ orders performs other tasks from retailers

• Order-getter (Creative, Problem- • Getting orders from existing and • Automobiles, refrigerators, solving, Consultative selling) new household consumers insurance policies • Getting orders from business • Software and business solutions customers, by solving their business and technology problems

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Importance of Personal Selling and Sales Management • The only function / department in a company that generates revenue / income • The financial results of a firm depend on the performance of the sales department / management • Many salespeople are among the best paid people in business • It is one of the fastest and surest routes to the top management 7

Roles and Skills of a Modern Sales Manager Some of the important roles of the modern sales manager are: • A member of the strategic management team • A member of the corporate team to achieve objectives • A team leader, working with salespeople • Managing multiple sales / marketing channels • Using latest technologies (like CRM) to build superior buyer-seller relationships • Continually updating information on changes in marketing environment 8

Skills of a Successful Sales Manager • People skills include abilities to motivate, lead, communicate, coordinate, team-oriented relationship, and mentoring • Managing skills consist of planning, organizing, controlling and decision making • Technical skills include training, selling, negotiating, problem-solving, and use of computers

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Types of Sales Managers / Levels of Sales Management Positions CEO / President V. P. Sales / V. P. Marketing

Top-Level Sales Managers / Leaders

National Sales Manager

Regional / Zonal / Divisional Sales Managers District / Branch / Area Sales Managers

Middle-Level Sales Managers

First / Lower Level Sales Managers

Sales Trainee / Sales Person / Sales Representative

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Sales Objectives, Strategies and Tactics The main components of planning in a company are objectives, strategies and tactics. Their relationship is shown below Decide / Set Objectives

Develop Strategies

Evolve Tactics / Action Plans

E.G. A company wants to increase sales of electric motors by 15 percent, as one of the sales objectives. (see next slide)

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To illustrate the relationship between sales objectives, strategies and tactics, consider: Sales Goals / Objectives



Increase sales volume by 15 percent

Marketing Strategy





Sales and Distribution Strategy

Enter export  markets 

Penetrate existing domestic markets





Tactics / Action plans

Identify the countries



Decide distribution channels



Review and improve  salesforce training, motivation  and compensation Use effective and efficient  channels 

Marketing / sales head to get relevant information Negotiate and sign agreements in 3-5 months with intermediaries

Add channels and Train salespeople in deficient areas Train field salesmanagers in effective supervision Link sales volume quotas to the incentive scheme of the compensation plan

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Emerging Trends in Sales Management • Global perspective • Revolution in technology • Customer relationship management (CRM) • Salesforce diversity • Team selling approach • Managing multi-channels • Sales professionalism 13

Linking Sales and Distribution Management • Either sales management or distribution management cannot exist, operate or perform without each other • To achieve the sales goals of sales revenue and growth, the sales management plans the strategy and action plans (tactics), and the distribution management has the role to execute these plans

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Role of Distribution Management for some of the Sales Management Actions / Tasks Sales Management Actions / Tasks

Distribution Management Role

 Strategy for effective coverage of markets and outlets

 Follow call plan / beat plan  Make customer call productive  Use multi-channel approach

 Strategy for handling customer complaints

 Prompt action at the customer interface level  If the problem persists, involve senior sales and service people

 Planning of local advertising and sales promotion

 Co-ordination with distribution channels  Responsibility of execution with distribution channels  Expenses are shared between the company and 15 intermediaries

Key Learnings • Sales management is defined as the management of the personal selling part of a company’s marketing function • Selling includes varying sales jobs like delivery salesperson, order taker, sales person, and order getter • Sales is the only function or department in an organization that generates revenue / income • Skills of a successful sales manager include managing, technical and people • Main components of sales planning are objectives, strategies, and tactics (or action plan) • Either sales management or distribution management can not exist, operate or perform without each other 16