CHAPTER - IV
SALES SETTINGS
1


Environmental and Managerial Forces
Impacting Sales:
A number of major environmental
( behavioral and technological) and
managerial forces impact on how
selling and sales management are
and will be carried out
2
Behavioral Forces:
As customers adjust to a changing
environment, so sales has to adapt to
variety of influences;





Rising consumer and organizational buyer
expectations more better treatment ,more
quality ,services
Customer avoidance of buyer – seller
negotiations fixed price ,package deal
Expanding power of major buyers,
profitable customers ,retailers
Globalization of markets adaptation
Fragmentation of markets using
segmentation strategies
3





Managerial Forces:
Managers can respond to the changes in
the environment by developing new
strategies and tactics to enhance sales
effectiveness, including;
Employing direct marketing techniques
Improving cooperation between sales and
marketing
Encouraging sales people to attend
training programs and gain professional
qualifications
4




Strategic Customer Management:
The result of the managerial forces is to
change the role and operation of the
traditional sales organization from a focus
on order- taking and order-making to
strategic customer management
Strategic customer management requires
three activities to be performed;
Intelligence; Enhancing customer
knowledge to add value to customer
relationships
5


Interfaces; refocusing sales force efforts
into management and exploitation of
critical interfaces that affect customer
value traditional sales techniques with new
one
Integration; The process of welding all
the company’s activities and processes
that affect customer value into a single,
integrated and sustained point of value
delivery to customers (cooperation
between departments of organization)
6





Sales Channels:
Distribution channels involve two separate,
yet closely connected, activities;
Logistics or physical distribution
management
( PDM) and
Channels of distribution
Logistics or PDM; the term logistics and
PDM are interchangeable, although some
writers infer that logistics is more concerned
with strategic issues where as PDM relates
to tactics.
7









Logistics conventionally starts with customers
and works back towards to the original source of
supply
The term supply chain integration ( S C I) is
sometimes used to describe its effective
coordination
The logistics mix describes the functional
elements involved in this process;
Order processing
Materials handling
Warehousing
Inventory control
Transportation
Packaging
8





Channels of distributions;
Management should constantly reappraise
channels of distributions to make cost
savings
Marketing channels are determined by
company policy and this determines how
the sales force should be organized
A sales channel is the route that the goods
take through the selling process from
supplier to customer
Sometimes the sales channel is direct and
can also be indirect
9








Selecting/reappraising sales channels;
When selecting channels, the company
must take into consideration the
following;
The market
Channel costs
The product
Profit potential
Channel structure
Product life cycle
10






Characteristics of sales channels;
Basically, manufacturer has a choice
of one of four types of distribution;
Direct
Selective
Intensive
Exclusive
11



Industrial/Commercial/Public
authority selling; (Organizational
Customers)
These categories are grouped
together as sales approach is similar
and behavioral patterns exhibited by
each confirm to organizational
behavior
A number of characteristics in these
types of market distinguish them
from consumer markets
12











The characteristics are;
Fewer customers
Concentrated markets
Complex purchasing decisions
Long-term relationships
Reciprocal trading
Types of production; There are a number
of different types of production;
Job production ships
Batch production furniture, books
Flow production; cares
Process production; chemicals
13









Selling for resale; This includes selling to
retailers, most of whom are multiples
which effectively perform their own
wholesaling functions
There are seven different types of selling
outlet;
Multiples, chain stores more 10 ,similar products
Variety chains, 5 store different products
Cooperative societies,
Department stores,
Independents,
Mail order,
Direct selling in homes
14





Franchising;
A more recent trend in European retailing
has been contractual system of franchising
It is a corporate vertical marketing system
( VMS) as its power is based at a point in
the channel that is one or more stages
removed from the end customer
Modern franchising is a US phenomenon
that was introduced to the UK in the
1950s
Franchising comes in a number of forms
15






From manufacturers to retailers Car
manufacturer license
From manufacturers to wholesalers cola
From wholesalers to retailers
Service firm sponsored franchises to
retailers KFC
Franchising arrangements have a common
set of procedures;
The franchisor offers expert advice on
such matters as finance, locations,
marketing
16






The franchisor promotes the image nationally or
internationally
Many franchise arrangements have a central
purchasing system
The franchise agreement provides a binding
contract to both sides
The franchisor often provides initial start up and
then continues training to the franchisee
A franchise arrangement normally requires a
franchisee to pay a royalty or franchisee fee
to the franchisor
However, the franchisee owns the business and
is not employed by the franchisor
17




Selling Services:
Just like tangible products, a service
must satisfy needs of buyers
Services come in many forms and
example include transportation,
communication, clubs, cleaning,
library, computing services, stock
broking services etc.
Special characteristics of services
include intangibility, inseparability,
storability and maintenance of
standard
18








Sales promotion:
Sales promotion include techniques that
organization can use as part of their
marketing effort
Objectives that can be achieved through
sales promotion activities include:
Encouragement of repeat purchases
Building of long term customer loyalty
Encouragement of consumers to visit a
particular sales outlet
Building up of retail stock levels
Widening or increasing the distribution of
a product or brand
19






Sales promotion include:
Price reductions, Gifts, Competition,
Lotteries, Vouchers or Coupons, Cash
bonuses etc.
Sales promotion techniques cover :
Consumer promotion – pull
techniques
Trade promotions – Push techniques
Sales force promotions: These are
promotions to the sales force, but
some apply to distributors and
retailers
20


Exhibitions are tangentially related to
sales settings as the objectives not
to sell from display stands, although
in some circumstances exhibitions
and trade fairs are where most
business takes place
Generally speaking, their function is
to build up good will and prepare the
way for future sales
21





Public relations:
Public relations covers a broader
spectrum than selling or indeed
marketing
Its application is wider and
encompasses the entire organization
and its various external and internal
publics
Jefkins defines Seven basic publics;
The community, Employees,
Government, The financial
community, Distributors, Consumers
22





Corporate public relations;
This is concerned with group image and
based on long term, carefully planned
program designed to achieve maximum
recognition and understanding of the
organization’s objectives and performance
which is in keeping with realistic
expectations
Effective Public Relations: Effective PR
depends upon the following:
Setting specific objectives that are capable
of evaluation
Fully integrating the PR function into the
organization
23