Introduction to Sales and Distribution Management

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

Difference between Selling and Marketing

Selling Emphasis on product Company Manufactures the product and then decides to sell it Marketing Emphasis on consumer needs and wants Company first determines the customers needs and wants and then decides how to deliver a product for satisfaction Management is profit oriented Long term planning: new products, tomorrows markets and future growth. Stresses needs and wants of buyers Views Business as a consumer satisfying process Emphasis on Innovation Integrated working Consumer determines price ,price determines cost

Management is sales volume oriented Short term planning: todays products and markets Stresses needs of a seller Views Business as a goods producing process Emphasis on staying with existing technology Watertight compartments of departments Cost determines price

SDM-Ch.1

 Selling views customer as the last link while

marketing views customers as the very beginning of the business. Ore Selling is Inward looking It persuades the customer to take what the manufacturer has got Marketing is outward looking and tries to match the real requirements of the customer.

SDM-Ch.1

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

Concept of Sales Management

Sales Management originally referred to the

direction of the sales force personnel. Later, the term took on broader significance in addition to the management of personnel selling, Sales Management meant management of all marketing activities, including advertising, sales promotion, marketing research, physical distribution, pricing and product merchandising.

What is Sales Management?

One definition: The management of the

personal selling part of a companys marketing function. Another definition: The process of planning, directing, and controlling of personal selling, including recruiting, selecting, equipping, assigning, supervising, paying, and motivating the personal sales force.

Objectives of Sales Management

a) Sales Volume

b) Contribution to profits
C) Continuing growth

Nature of Sales Management

Its integration with marketing management
HeadMarketing

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 / /

Relationship Selling
Salespeople concentrate their team selling efforts

on building trust and service on a few carefully selected customers over a long period with a aim of becoming a preferred or sole supplier

 Transactional Relationship / Selling:- one type of

relationship marketing in which salespeople make onetime sales to price-oriented customers ,who are not contacted again Value added Relationship / Selling:- understanding current and future needs of customers and meeting those needs better than competitors with value added solution to their problems Collaborative relationship :- a type of relationship marketing in which a selling organization works continuously with its large customers to improve the customer performance in terms of operations , sales and profit

 Varying Sales Responsibilities / Positions / Jobs

Sales Position Delivery salesperson Brief Description Examples Delivery of products to business Milk, newspapers to households customers or households. Also takes orders. Soft drinks, bread to retail stores. Inside order taker 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 Provide information, build Medical reps. in pharmaceutical goodwill, introduce new products industry Technical information, assistance: professional consulting Steel, Chemical industries need technical inputs Getting orders from existing and Automobiles, refrigerators, new household consumers insurance policies Getting orders from business Software and business solutions customers, by solving their business and technology problems

Order taker (Response selling)

Sales support Missionary selling Technical selling

Order-getter/demand creator (Creative, Problem-solving, Consultative selling) Solution vendor(business selling)

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

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 marketing environment

on

changes

in

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

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

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.

To illustrate the relationship between sales objectives, strategies and tactics, consider:
Sales Goals / Objectives Marketing Strategy Sales and Distribution Strategy Tactics / Action plans

Increase sales volume by 15 percent

Enter export markets

Identify the countries Decide distribution channels

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

Penetrate existing domestic markets

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

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

Emerging Trends in Sales Management

Global perspective

Revolution in technology
Customer relationship management (CRM) Salesforce diversity

Team selling approach

Managing multi-channels Ethical and social issues

Sales professionalism

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

Role of Distribution Management for some of the Sales Management Actions / Tasks
Sales Management Actions / Tasks
Strategy for effective coverage of markets and outlets

Distribution Management Role

Follow call plan / beat plan Make customer call productive Extending required level of credit 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

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

Planning of local advertising and sales promotion