Sales & Distribution
Intro to Sales Management
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Understand Concept of Sales Management
Evolution of Sales Management
Importance & Functions of Sales Management
Understand Process of Sales Management
Evolution of Personal Selling
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Persuasion
Negotiation
Consultative Selling
Business Management
Partnership Strategies
Marketing Concepts
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Production Concepts
Product Concept
Concept Selling
Marketing Concept
Societal Concept
Sales Oriented Management focuses on Selling Needs
Marketing Oriented Management focuses on
Customer needs
Nature and Role of Sales Management
• Determine Sales force Objectives & Goals
• Decide on Sales Organization, Size, Territory &
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Quota
Sales Forecasting & Budgeting
Selection,Recruitment & Training
Motivation and Leading Sales Force
Finalize Compensation Plan,Checks & Balances
Career Growth plans/Building
Relationships/Strategies with Major Accounts
Types of Selling
• Consumer /Retail
• Industrial
• Services Selling
Types of Selling
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Inside Order Taker
Delivery Sales people
Outside Order taker
Missionary Sales People
New Business sales
Organisational Sales
Consumer Sales
Technical support
Merchandisers(Retail & Whole sale selling)
Selling
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Emphasis on Product
Product first
Sales Volume oriented
Short term
Needs of Seller
Business is Good producing
Emphasis on Technology / Costs
Departments working watertight compartments
Costs determines the price
Customer is the last link
Selling Process
• Leads /Referrals/ Orphans (Sales Persons Left) / Customers
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/Find Company records
Prospecting
Customer Contact
Presentations
POC / Demonstrations
Objections Handling
Closing
Follow up
New Enquiries
Marketing
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Emphasis on Customer needs
Needs are first than the productization
Profit Oriented
Long term/Tomorrow’s markets
Customer satisfaction as business process
Innovation with superior technology
All departments operate as integrated unit
Consumers determine the price / costs
Customer is beginning of Business
5 P’s of Marketing
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Market Mix
Product
Price
Place
Promotion
Packaging
Sales pulls the Customers
Eg Marketing LG/Compaq/Federal Express
Sales Management Process
• Formulation of Strategic Sales Management
Program
• Implementation of the Strategic Management
Program
• Evaluation & Control of Sales Management
Formulation Of Strategic Program
• How Sales can be dovetailed into Company’s
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vision & Marketing strategy
Way to approach the Prospects
Organise the Sales Force
Level the performance of Sales force
Deployment of Sales Force based on Demand
Forecast of the business needs
Implementation of Strategy
• External Environment
• Potential Customers/Competition/Legal & Political
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Environment/Tech environment/Natural
resource/Social & Cultural environment
Internal Environment:
Objectives/Vision/Mission/Human
Resources/Financial Resources/Capacity &
Production Processes/R& D /Innovation
Marketing Strategy/Sales Management
Functions
• Product & Product lines/Pricing
Policy/Distribution Strategy/Ad & Sales
Promos
• Sales Management Functions:
• Account Management /Sales force Org/Sales
Planning/Forecasting/Quota
• Sales force Deployment/Territory design &
Route planning/Supervision
Implementation of Strategic Sales
Management Program
• SM Fns- Determine Sales Performance-Results
• Supervision/Job Descriptions/Sales
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Volume/Quota/Profitability of Customer/Sales
Reports/Ethical practices
Motivation & Compensation/Reward/Sales
Training/Recruitment
Aptitude/Skills /Motivational levels
Evaluation & Control of Strategic Sales Management
Program
Emerging Trends in Sales Management
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Technology
Customer Orientation
Global & Ethical issues
New Selling Techniques
Diversity
Relationship Selling
Selling Skills & Strategies
• Understand different buying & Selling styles
• Understand & Internalize the selling skills
• Comprehend the process of Building Communication
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skills
Learn to improve listening skills
Conflict Management and Resolution skills
Learn to bargain & win the Sale deal
Understand problem solving skills
Selling Types
Concern For Customer (Y AXIS)
People Oriented
Problem Solving Oriented
Sales Technique Oriented
Take it or Leave it
(Concern for Sale) X AXIS
Push the ProductOriented
Sales task & Functions
• Hunting & farming( New Business
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Development/Maintenance & increase the Share of
the wallet
Selling Skills:
Good Sales Person : Honest/ Loses sale
graciously/admits mistakes/Possesses problem
solving skills/Friendly but
professional/Adaptable/Knows my business/Well
prepared/Patient
Selling Skills
• Bad : Does not follow up / walks in without
appointment/puts down competitors
products/poor listener/lousy presentations/fails
to ask needs/lacks product knowledge/wastes
time
Communication Skills
• Relationship is long term where there is
mutual trust
• Truth of words communicated by Sales person
• Predictability of
action/Comeptency(Ability/knowledge/resours
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• Intent or Empathy/Likeability
Communications Process
• Intended message / Encoding/Sent message
• Channel
• Received message/ decoding/perceived
message
• Feedback
Non Verbal Communications
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Managing Body Language
Personal Appearance
Posture
Gesture
Facial Expressions
Eye Contact
Space Distancing
LISTENING SKILLS(2:1)
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Attendance
Interpretation
Remembrance
Evaluations
Response actions(Listening process)
Levels of Listening
Feedback (Formal & Informal) / Paraphrasing
/Clarifications/Empathetic listening/Active listening
Selling of Services $ 81 billion
business
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Tangible Goods
Tangible Goods + Services
Hybrid (Restaurants/Food Services)
Major Services /Minor Goods(Airlines
/Hotel/Tourism)
Pure Services-Psychological /Medicine/Baby
Sitting/Teaching/
Masseur)
GovernmentCourts/Hospitals/Police/Fire/Schools/Military etc)
Retail –Cashier / Sales
Factors affecting serviceability
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Place
People
Equipment
Communication Material
Symbols
Price
Availability
Perishability
Servicing Sales
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Differential Pricing
Complementary
Reservation systems
Holistic Marketing services
Pricing/Inconvenience/Core Service failure
Service Encounter failure
Response to service failure
Competition
Ethical Problem
Involuntary switching
Managing Service quality
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Reliability
Responsiveness
Assurance
Empathy
Tangibles
Set Quality Management
Strategic Concept
Top MANAGEMENT Commitment
High Standards
Recommendions for Service
Improvement
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Listening
Reliability
Basic services
Service Design
Recovery
Surprising Customer
Fair Play
Teamwork
Employee Research
Servant Leadership
Managing Services
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Differentiate Services
Establishing Brand dimension
Strategy
Customer Services needs
Prevention services
Breakdown
Emergency
MIS
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EIS
Sales Information Systems
Automation in EIS / MIS
Industry Software Applications for automation
CRM (Siebel/Oracle Applications/Talisma)
ERP( SAP/Peoplesoft/Oracle Business Suite)
SCM( Manugistics/ ??)
EIS
• Sr Level Executive Information Systems
• Key Sales parameters by Region/By Product/By Profit
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Margin/Volume)/major wins, Competitive Intelligence, New Customer
acquisitions
Key Financial parameters P&L Cash Flow, PE ratio, Creditors, Debtors,
Capital investments, ROI
Manufacturing-Key Production numbers BY Product lines, timelines,
plans, Quality parameters (Rejections), Planned breakdown
HR-Recruitments, Performance bonuses, Reviews, Training and relocations
,Appraisals / Exits
Customer Care- QoS levels, Customer satisfaction mechanisms &
redressal, Churn, Service complains & history
Sales Information System
Sales Forecasting
CRM Techniques
Sales per Region, Territory, Products, Volume, Margins, Executive
New Products / New Customer reports
Opportunities loss & reasons for major loss
Sales & Technical training programs
Credit limits /Collections details/Days Sales Outsatndings
Sales review
Calls /day/Region/Executive
Key Projects review
Competitive Landscape
Upselling /Cross selling opportunties in an account
Sales promos / Incentives
Dealer prorams
Sales Forecasting Process
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Follow the closed loop process as below
Develop a Forecast System
Select Forecast Analysis Method
Comprehend Forecast Procedure
Collect/Collate/Analyze data
Present assumptions about data
Make & Finalize forecast
Evaluate actual Performance against forecast
Forecast Objectives
Determine Dependant & Independent variables
Approach to Sales Forecasting
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General Environmental Forecast
Industry Sales Forecast
Company Sales Forecast
Sales forecast for the Product & Services lines
Individual Products & Services lines
Forecasting Methods
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Qualitative Methods
Expert’s Opinion
Survey / Buyers Expectations(AC Nielson)
Sales Force Composite
Delphi Technique(Group expert opinion in 3 rounds)(Time
Series Projections/ Regression techniques)
Historical Analogy method
Statistical Analytical Methods( Log Winters/ Corelation
/Regression analysis)(SPSS / SAS tools)
Econometric Techniques
Factors affecting forecast
Sales Quota Management
• Importance of Sales Quota
• Principles of quota setting
• Define annual objectives Sales / Organisation/
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Additional to Sales
Types of Sales quota
Sales Volume quota
Sales budget quota
Sales activity quota
Combination
Sales Budgeting & Quota
• Based on the Country Forecast Regional,
Territorial, AM wise forecasts are carried out
• Based on the forecast Budgets are allocated for
Marketing, Sales Organization expansion
• These budgets are to be monitored on
daily/weekly/monthly/quarterly/annual basis
against the forecasts and required reallocations
of forecasts/ targets are made
• Sales quota can also be fixed based on the
product based / Sales based/Activity based
Sales Organisation
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Org Structure with cross functional & support roles
Factors influencing structure
Products & Services related factors
Organisation related factors
Market mix (Products/ Local/Global/ Regional
External factors
Top down approach command & control driven
Horizontal & Customer driven
Organisational Principles
• Span of Control/ Unity of Command/
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Hierarchy of Authority
Stability & Continuity
Coordination & Integration
Homogenity
Objectivity
Specialization
Centralisation & Decentralisation
Typical Org Chart
• MD/ Chairman
• Sales/ Finance/Production/Customer Service
/Commercial/Legal /IT /HR/R& D– Directors
• National Sales Manager
• Regional Sales Manager
• Sales Officer
Org Chart by Customers
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Sales Director
National Sales Manager
Sales Manager (Industrial Sales)
Sales Manager( Whole sale)
Sales Manager( Retail sales)
Key Account Sales
Sales Process Automations
Associated /Extended Sales Org
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Wholesale Network
Retail Dealer Network
Shared Sales force with dealers
Telemarketing Sales Force
TQM / Team based selling
No of Sales People
Affordability
Incremental
Workload Method
Management of Sales Territory
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Global/Local bifurcations
Countrywise / Statewise/ Citywise /Rural
Advantages /Disadvantages
Intercontinental / Interstate collabrations for key accounts
Disadvantages
Sizing of territory based on Business Potential/sales volume
New Sales force new territory
Modify territorial boundaries based on workload / Potential
Optimum route planning /Avoid duplicate travel plans and
target more Business
Territory based on potential /Geography/Market share
10 Customers per AM on average
Recruitment & Selection
• Hiring process /Job Qualification/Job
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description
Planning / Recruitment /Select /Socialize
Performance= Ability*Motivational
Strategic Position Analysis
Turnover based recruitment
Job Analysis
Recruitment & Selection
• Internal Sources/Lateral & upward
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moves/Interns /Summer Trainees
Employee Referal program
External Sources of recruitment: Web/ads/Job
Fairs/Educational & Campus
Recruitments/Employment Agencies/Walk
ins/Networking
External vs Internal recruitments
Disadvantaged & Protected persons
Training of Sales Personnel
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Location
Job Instruction Training
Types of Training
Cross Functional Training
Team training
Product /Solutions training
One on One or Group Trainings
Participative Training
Conferences & Seminars/Industry Representations
Role plays based
Sales Incentives & Compensations
• Companywise Salary is broken down on Sales targets
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based from 50:50 to 90:10 per points
Compensation plan should encourage higher
performance
Pat on the back/Target based incentives/Critical
Project award
Financial/Kind /Travel trips for
couples/Commissions/Bonus/ Incentives/ Gifts/
Promotions/Recognitions /Fringe benefits/Perks/Sales
Contests
Relate rewards to performance/Measure /Appraise
Sales for evaluation & Control
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Activity reports/Barriers/KRA’s /MBO’s
Trait based
Outcome based
Behaviour based
Evaluation grid
Performance appraisal’s & ratings
Quality & content of reporting
Distribution /Channel Management
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Why ???
Activities of Distribution Channels
Spatial Discrepancy (Physical distances)
Temporal discrepancy(Batch & Continous
Manufacturing variance in consumption)
Need to break bulk
Assortment
Intermediation(Kirana)
Direct Disti control is low /cost efficiency high
Indirect disti cost effi good control/low cost effi
Distribution /Channel Management
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Value enhancement through Disti function
Disti strategy
Distributor Objectives
Channel activities
Organizing Channel Activities
Policy guidelines of Daily/Monthly/ Quarterly/Annual
operations & Business
• Channel Management
• Ex Ante Phase / Ex Poste Phase
• Pharma Disti
Distribution & Channel structure
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Manufacturer
C & F Depot/Super Stockist
Stockist
Wholesaler
Retailer/Chemists
Patient
Institutional Sales
Distributor Margins
Retail Margins
Turn over Discounts
Dealer Incentive schemes/Star Bonuses/
Customer Oriented Marketing
Channels
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Ownership flow
Promotion flow
Negotiation flow
Financing flow
Risk taking flow
Ordering flow
Payment flow
Conduct cost analysis
Comparing Channel design based on
effectiveness/Efficiency/Equity/Scalability/
Flexibility
Channel Establishment plan
• Main purpose of Channel /Dealer
• Customer profiles
• Needs & reqment of target market with regards to
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product & services
Analysis of similar existing channels & business potential
of region
Coverage
Activity breakup
Costs/Roles /Responsbilities
Discounts / Incentives
Standards of performance measurement
Reporting mecansisms/Monitoring mecanism
Selection criteria for Channel / dealers
Alternate Disti channels
• Franchising (McDonald/ Jumbo King)
• Direct Marketing
• Multi Level Marketing (Amway)
• Telemarketing
• Internet Marketing
• E Commerce
• M Commerce
Modes of Transport for Disti
• Road
• Rail
• Air
• Water
• Hybrid
• Route Planning
• Container Trucks
Terminology of Transport
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CIF
C&F
Freight to Pay
Cash on delivery
Customs / Excise/Sales Tax/VAT
Octroi
Inter State permits
Consignor /Consignee documents
Demurrage charges
Types of consignment
(Fragile/Perishable/Toxic/Inflammable/Bulk Cargo)
Forms of Packaging ( Cartons/ Boxes /Crates/
Barrels/Drums/ Pallets/ Cylinders/Reels/Rolls
Inventory Control Techniques
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ABC Analysis( Pareto 80:20 principle)
EOQ
HML
VED( Vital / Essential / Desirable)
SDE (Scarce/Difficult/ Easy)
FSN
GOLF (Government/Ordinary/Local / Foreign)
SOS (Seasonal/Off Season)
Stock accounting (LIFO/FIFO)
Warehouse Management
• Why need warehouse
• Functions of warehouse
• Movement/storage & Information transfer
• Storage/Bulk breaking/Consolidation /
Inventory Management
• Transfering/Order picking /selection/
shipping
• No of warehouses
• Costs of lost sales/Inventory
costs/Transportation/warehousing costs
Warehouse Management
• Centralised /Decentralised
• Functional/Raw Material/Production/ Quarantine/Finished
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Goods/WIP/ Bonded/Refrigerated
Planned for future/Road /Rail/Water transport access
Layouts for quick vehicle turnaround/ In Flow & outflow
ease /Maintainance Security Straight Flow through
Material identification systems(Bar
Codes/Codifications/Standardisation)
Receiving & Inspection systems
Storage systems/Preservation
Issue / receipt of materials
Stock verification & records
Safety /Security
Material Handling equipment
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Manual
Cranes/Gantries/Traveling cranes
Forklifts
Pallets
Tractors
Conveyors (Roller/ belt)
Hydraulic Lifts/Electric /Hoists/ Chutes/Docks
Vacuum Pressure systems
Maintenance/ Misuse/Economy of use
Computers in warehouse
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Codification
Networking (LAN / WAN)
Electronic Identification ( Bar Codes)/RFID
EDI
Reports( Quantity/Value/YTD
Consumption/receipts/analysis/lead time /
exceptions/ suppliers master/pending
purchases/vendor performance/ave inspection
time/transfer time to inventory/storage/
emergency purchases/ICC
Link to ERP
Mgmt of Company owned vehicles
• Perk in Sales account
• Average travel allowance
• Maintenance allowance
• Lease Vs Rental
• Ave mileage/safety
• Door delivery/Pick up service
Techniques of Mass Disti
• Containerisation
• Route planning based on the sales orders
• Multi product delivery vans
• Van Salesman
• Stockist / Dealer retail deliveries
• Perishables multiple deliveries
Packaging
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Very Specialized domain & an Industry
Good looks / Preservative / Protection/Printing statutory guidelines
Quality of material preservation for food / chemicals/
EOQ sizes
FFS (Form/ Fill & Seal packaging for toothpastes/Liquids /Pan Parag)
Blister packing for tablets
Bottles/Vials/Plastic bottles/bags/sachets
Bagging ( Fertilizers / Chemicals/Food grains)
Containerisation
Materials( Paper / Plastic/ Aluminium foils/ Glass/
Wood/Metal/Jute/Cotton/Bubble wrapper)
• Based on products food, cosmetics, toiletries, textile, building
material, Gases, Liquids, Hazardous chemicals
• Preservatives like Salt/ Refrigeration/Nuclear treatment
• Reusable / Use & dispose