Sdm ch 1 - MBA DSU 3rd SEM
- 1. SDM-Ch.1 1 Chapter 1 Introduction to Sales and Distribution Management
- 2. SDM-Ch.1 2 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
- 3. SDM-Ch.1 3 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
- 4. SDM-Ch.1 4 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, assigning, supervising, paying, and motivating the personal sales force.
- 5. SDM-Ch.1 5 Nature of Sales Management • Its integration with marketing management • Relationship Selling Collaborative / Partnering Relationship / Selling Value – added Relationship / Selling Transactional Relationship / Selling Head- Marketing Manager – Customer Service Manager – Market Logistics Manager – Sales Manager – Market Research Manager- Promotion
- 6. SDM-Ch.1 6 • Varying Sales Responsibilities / Positions / Jobs • Automobiles, refrigerators, insurance policies • Software and business solutions • Getting orders from existing and new household consumers • Getting orders from business customers, by solving their business and technology problems • Order-getter (Creative, Problem- solving, Consultative selling) • Medical reps. in pharma industry • Steel, Chemical industries • Provide information, build goodwill, introduce new products • Technical information, assistance • Sales support ● Missionary selling ● Technical selling • Behind counter in a garment shop • Pharma products’ orders from nursing homes • Food, clothing products’ orders from retailers • Inside order taker • Telemarketing salesperson takes orders over telephone • Outside order taker. Also performs other tasks • Order taker (Response selling) • Milk, newspapers to households • Soft drinks, bread to retail stores. • Delivery of products to business customers or households. • Also takes orders. • Delivery salesperson ExamplesBrief DescriptionSales Position
- 7. SDM-Ch.1 7 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
- 8. SDM-Ch.1 8 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
- 9. SDM-Ch.1 9 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
- 10. SDM-Ch.1 10 Types of Sales Managers / Levels of Sales Management Positions CEO / President V. P. Sales / V. P. Marketing National Sales Manager Regional / Zonal / Divisional Sales Managers District / Branch / Area Sales Managers Sales Trainee / Sales Person / Sales Representative First / Lower Level Sales Managers Middle-Level Sales Managers Top-Level Sales Managers / Leaders
- 11. SDM-Ch.1 11 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)
- 12. SDM-Ch.1 12 To illustrate the relationship between sales objectives, strategies and tactics, consider: • 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 • Review and improve salesforce training, motivation and compensation • Use effective and efficient channels • Penetrate existing domestic markets • Marketing / sales head to get relevant information • Negotiate and sign agreements in 3-5 months with intermediaries • Identify the countries • Decide distribution channels • Enter export markets • Increase sales volume by 15 percent Tactics / Action plans Sales and Distribution StrategyMarketing Strategy Sales Goals / Objectives
- 13. SDM-Ch.1 13 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
- 14. SDM-Ch.1 14 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 • This will be illustrated by considering some sales management actions and corresponding role of distribution management (in the next slide), as well as by discussing a few integrated cases given at the end of the book
- 15. SDM-Ch.1 15 Role of Distribution Management for some of the Sales Management Actions / Tasks • 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 • Prompt action at the customer interface level • If the problem persists, involve senior sales and service people • Strategy for handling customer complaints • Follow call plan / beat plan • Make customer call productive • Use multi-channel approach • Strategy for effective coverage of markets and outlets Distribution Management RoleSales Management Actions / Tasks
- 16. SDM-Ch.1 16 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 support 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