Sales Organization

Definition of Sales Organization
The value-based orientation and set-up of sales channels and management structures is a central part of sales control. In the past, having an extensive agency network was a central success factor. In the future, the focus is more likely to be on networking of various sales channels (key word: multi-channel). This will mean numerous changes, for example in the supply of the necessary information, in the management of sales channels, and also in the creation of customer-friendly product bundles. Integrated reconciliation of sales activities and avoidance of channel conflicts will be of great importance.

Building the sales organization
The sales department in any organization occupies strategic position. Of all company personnel, those in the sales department are in the closest touch with final buyers and middlemen. Sales department personnel also work closely with such key publics as the industry, the government, the educational world and the press. How these representatives of the sales department conduct themselves with the public affects the company’s reputation. Good relations depend in larger measure upon the skill with which personnel selling programs are planned and executed, thus building an good sales organization plays a very important role in maintaining above said relations and promote the sales.

Sales Control

Sales co-ordination and sales controlling including sales expense control
Sales co-ordination goes hand in hand with sales control. The sales executives have the responsibility for co-ordinating the different elements of the selling efforts. He should ensure that the various elements do not pull in different direction.

It is through sales control that the sales executive ensures that all the personnel selling objectives of the firm are achieved. Sales control also helps him to ensure that the sales goals are properly aligned with the other goals of the firm. Even in online business sales control is very much important factor. Online blinds store who are selling roller shades and woven wood shades, for them sales control is very much important factor.

Methods of sales control:
Sales managers use both formal and informal control methods in exercising sales control. The more common one among the methods of sales control are as follows:

a) Sales targets and sales reports
b) Sales expenditure budget and expenditure reports
c) Travel plan and tour reports
d) Watching the salesman in the field
e) Information gathered from dealers and major customers.
f) Inspection of depots/warehouse
g) Sales conferences.

In our next post we will discuss on some important part of sales force management and which is Sales Organization and sales promotion.

Sales report

Today we are going to discuss on Sales Report and user of sales reports and types of sales reports. The fundamental purpose of sales reports is to provide control information. Good communications require interaction between those preparing and those receiving reports. A good sales reporting system provides both for communication from field to headquarters and from headquarter to the field. Field sales reports provide sales management with a basis for discussion with sales personnel and it helps to the sales personnel in their self-improvement programs.

Uses of sales reports:
a) Sales reports provide data for evaluating performance.
b) Helps to plan the activity to the salesman.
c) Helps to record the customers suggestions and complaints, about products, service policies, price changes advertising campaigns etc.
d) Helps to gather information on competitors activities.
e) Helps to report changes in local business and economic conditions.
f) To keep the mailing list updated for promotional and catalog materials.
g) To provide information required by marketing research.

Types of sales report:
a) Progress or call report
b) Expense report
c) Sales work plan
d) New business or potential new business report
e) Report of complaint and/or adjustments

Growth and Development

Ensuring growth and developing new accounts
Sales organization plays important role not selling to the existing customers and the same number of units all the time, it is very important to maintain growth in the quantity of sales through identifying new markets and the new customers. In term life insurance business, adding new clients, they can sell new policies and by that business can grow and get developed. So, for term life insurance company identifying new segment of markets and by that adding more and more new customers is always on priority list.

Sales communication and reporting
Sales management is carried out largely through communication-either it is oral or written or both. The communication in the sales department is two way process. The sales manager lets his men know what they are expected to achieve, how they are performing, how they can improve and perform better. He also keep them informed of what is happening in the company related to the, products, production, distribution, promotion and profitability. Insurance SFA software helps term life insurance agents to keep and maintain two way sales communication and sales reporting.

The salesman in turn keep the sales manager informed of what is happening in the market and how the sales and marketing programs of the firm are progressing. In the field’s sales situation, communication cannot be always face-to-face as in factory or in office situation. A Local installer for blinds and roller shades company play important role for two way sales communication. He let customer know about the company products and policies at the same time he update company about the feedback from the customer. Sales persons work independently and always from the office.

Managing the marketing channels

It is very important to secure and maintain harmonious working relationships with the distributive networks are an important as building and maintaining favourable relations with final buyers. Distributive outlets are customers for the products, and collectively they bear responsibility for making the pay-off sales to final buyers. Unless the supply of product flows through the final buyers, marketing channels clog, and all previous personnel selling and other marketing efforts are wasted.

Both the manufactures and distributive outlets have much to gain from co-operation, and much to loose if it is lacking. Although co-operation is a two way street, generally the manufacturer must initiate it. Those charged with planning, administration, and implementation of programs of co-operation with distributive outlets must consider the implications for personal selling strategy and sales department operations.

No manufacturers marketing program is complete if it lacks plan for securing and maintaining the co-operation of the distributive outlets. The fortunes of manufacturers rise and fall with those of their distributors and dealers. If distributors and dealers succeed in selling the products, the manufacturer also succeeds if they fail the manufacturer fails.

Training and development

In every area training is the prerequisite to improvement, like-wise the purpose pf sales training is to achieve improved job performance, and the training should rest on the convictions that every salesman can be improved through carefully designed training

Steps involved in designing sales training:

1. Defining training aims.
2. Determining the training needs.
3. Determining the special needs.
4. Deciding nature and type of training required: Normally following are the some types of training, In company training, external training, individual training, group training, on-the job training, off-the job training.
5. Deciding the content.
6. Choosing the methods: The lecture, the personal conference, demonstrations, role playing, case discussions etc.
7. Developing the material required for training.
8. Evaluating the effectiveness of the training.

Aims of Sales training: Normally the sales training will have following aims to inculcate new techniques or to improve upon the existing knowledge.

1. To increase sales.
2. To acquire new accounts.
3. Faster turn round stocks.
4. Selling a complete product line instead of just fast selling items.
5. Better merchandising and sales promotion.
6. Better technical knowledge.
7. Improving sales presentation and sharpening sales skills.
8. Improving customer relations and dealer relations.

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Sales Approaches

Symptoms of poor morale:
1. Minor complaints get magnified.
2. Unionism suddenly arises.
3. Anti-management attitude of sales personnel.

Sales coaching/supervision: It is also important factor in sales management. It is perhaps the most neglected, but potentially most rewarding area. Effective sales supervision will increase sales and profits and reduce selling expense. It will also improve the morale and motivation of the salesman and reduce their wasteful turnover. The extent and sales supervision may vary depending the complexity of the organization. Important aspect that requires close supervision includes.

1. Setting norms for sales calls.
2. Managing key customers.
3. Guiding salesman on route planning.

Evaluation/appraisal: The basic idea of all performance appraisals is the belief that human beings have great capacity for growth and improved performance under right climate for performance, they will respond creatively and positively. The same principle applies equally to the performance appraisal of sales personal. The sales personnel perform better when performance criteria, goals, and tasks are established clearly and by mutual agreement. Likewise their performance is considerably improved when they are given periodic feedback on how they are performing and in what areas they can improve by greater application. The sales personnnel performance helps debt consolidation work in company. They also come up with improved performance when they are given the necessary help and guidance on the job and are rewarded promptly according to their contribution.

Motivation of sales personnel

Motivation sales personnel is an important aspect of sales force management sales force management sales personnel require additional motivation because of inherent nature of the sales job, role conflicts, the natural tendency towards apathy, and difficulties in building group identity. The concept of need gratification and interdependence assist in understanding efforts require that sales personnel. Implementing motivational efforts require that sales executives be skilled leaders, rather than drivers, of sales personnel. It demands that they be skilled in interpersonal and written communications. Satisfactory job performance develop out of deep understanding of motivational forces and process, effective leadership, two-way communication, and effective handling of relationships.

Moral building: Motivation in the larger sense includes morale good morale leads to good motivation and to good performance. In other words, morale and motivation go to hand in hand, it is the responsibility of sales management to built up the morale of the sales force and maintain it at high level. Following are the some of the reasons for poor morale.
1. Improper designing of the sales territories.
2. Some salesman might be given territories with little potential.
3. The compensation plan may be faulty.
4. Performance evaluation not done with fairness and objectivity.
5. Unfair treatment in rewards, transfer and promotions.

Compensation plan types

Types of compensation plans:

A. Straight salary plan:
This is the simplest compensation plan under this plan sales person receive fixed sums at regular intervals, representing total payments for their services. This method has advantages as well as disadvantages it should be carefully chosen according to the type of product industry.

B. Straight-commission plan:
This plan mainly relies on the theory that the sales personnel should be paid according to productivity. The assumption underlying this plan is that sales volume is the best productivity measure and can therefore be used as the sole measure.

C. Combinations of salary and incentive plan: Most sales compensation plans are combinations of salary and commission plans. It includes fixed salary plus incentive according to the performance of the individual sales person.

Apart from the above methods some companies may have the system of paying bonus and fringe benefits, Bonus differ from combinations – Infact a bonus is a amount paid for accomplishing a specific sales task a commission varies in amount with sales volume or other commission base. Fringe benefits, which do not bear direct relationship to job performance, it is normally percent of the total sales performance package, out of which some are required by legal and government such as provided fund, gratuity, etc.

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