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Sales Management 6

Sales Management 6. Sales Organization. Purpose of Sales Organization. Divide and coordinate activities so that the group can accomplish objectives better than if acting as individuals. Specialization of _________ _________ and _________ _________ and Integration Goals  Structure.

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Sales Management 6

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  1. Sales Management 6 Sales Organization

  2. Purpose of Sales Organization • Divide and coordinate activities so that the group can accomplish objectives better than if acting as individuals. • Specialization of _________ • _________and _________ • _________and Integration • Goals  Structure

  3. Specialization of Labor • Concentrate: Become more proficient at one thing. • Assign tasks according to ability. • Line/Staff organization is most common.

  4. Stability and Continuity • You can organize around activities, not around individuals. • The organization survives the individuals within it.

  5. Coordination and Integration • Activities of the sales force must be integrated with customer needs and concerns. • Selling activities must be coordinated with other departments: production, product development, logistics, finance. • Selling tasks among specialists must be coordinated.

  6. Internal: Horizontal Structure • _________: States/Regions, Downtown/Suburban • _________: Yard Equipment vs. Power Tools • _________: Industrial/Consumer, Hospitals/Schools, Wholesalers/Retailers • _________: Prospecting, presenting, servicing

  7. Geographic Organization • Simplest and most common form • Each salesperson handles all sales functions in the territory. • Advantages: • _________: travel, management • One point of contact for _________ • Disadvantages: • No division/specialization of _________ • Salespeople focus on products/customers that _________ _________.

  8. Product Orientation • Used primarily by firms with large and diverse product lines, and firms with highly technical products. • Advantages: • Familiarity with _________and _________ • Can lead to closer coordination with _________ • Better control: can allocate across company lines. • Disadvantages: • Duplication of _________ higher selling costs • Need more _________ • Multiple contact people for customers

  9. Customer/Market Organization • Advantages: • Better understanding of __________________ • Can be trained to sell to particular _________ (e.g. Hospitals vs. Schools) • Can gain insight into product applications, _________, new products • Managers can vary sales force size to market • Disadvantages: • Higher _________expenses • Large customers can have multiple sales _________

  10. Selling Function Organization • Each salesperson focuses on a particular part of the selling process. • Acquiring new customers (development specialists) vs. maintaining and servicing existing customers • Telemarketing: Inside/Outside Sales • Prospecting/Qualifying: turn leads over • Servicing problems quickly: hotlines • Seeking repeat sales: especially small & remote customers • Quicker communication on noteworthy developments • Feed-in via targeted advertising, direct mail, toll-free lines, web pages

  11. National/Key Accounts I • Rules of Thumb: ___% of customers can lead to ___% of sales; ___% can lead to ___%. • Salesperson must be a business manager: • Be able to customize products/services • Knowledgeable about strategic objectives • Can build and implement a business plan

  12. National/Key Accounts II • Major account management has dual goals: • Making _____ • Developing long term __________with major customers • Larger share of customer leads to larger _____. • But: • Major accounts often need detailed and sophisticated treatment. • Need more experienced, expert salespeople with greater authority. Commission may lead to conflict.

  13. National/Key Accounts III • Assign key accounts to top sales executives • Create separate corporate division • Create separate sales force

  14. National/Key Accounts IV • Smaller firms don’t have resources for separate division or sales forces. • They have relatively few major accounts • Salesperson must be high enough in the organization to make/influence decisions. • Takes time from managerial responsibilities.

  15. National/Key Accounts V • When few customers account for a large percentage of sales: can coordinate manufacturing, logistics, marketing and sales. • But there is often a duplication of efforts and added sales expenses.

  16. National/Key Accounts VI • Treat major account executives like: • Regional sales managers • District managers • Vice presidents • Advantages: • Know ______better, can ______ better • Often viewed as promotion, can assign best people • Disadvantages: • Duplication of ______ • ______

  17. Team Selling • Response to more complex relationship with customer: Stronger knowledge, better service • Get different expertise from multiple organizational functions • High costs: time and personnel • Complicated: coordination, motivation, compensation

  18. Multi-level Selling • Teams call on corresponding management levels at the customer’s office. • VP to VP • Engineer to Engineer • Technician to Technician

  19. Co-Marketing Alliances • Teams from multiple organizations work together to sell complex products or systems. • Capitalize on each member’s competencies (technical knowledge, sales force)

  20. Logistical Alliances and Computerized Ordering • Direct and often automatic reordering (e.g. ______) • Easier for customer • Creates ______ tied relationship • Frees sales force up to sell to new customers, or new products to existing customers.

  21. Global Sales Structure • Same basic issues: • Own sales force vs. agent • If own people, what structure? • Decision factors more complicated due to distance, customs, legal/political considerations.

  22. Vertical Structure I • Should Sales be integrated within the Marketing Department as it seems to be in over ¾ of companies responding to survey? • Should it be a separate unit as it is in about 20% of the responding companies?

  23. Vertical Structure II • Number of Management Levels vs. Span of Control • How many levels to have? • How many ______ should each manager supervise? • Fewer levels • Facilitates ______ • Lowers ______ costs • Lowers ______ : less effectiveness and productivity

  24. Vertical Structure III • Reduce span of control if: • Sales task is ______ • Profit impact of each salesperson’s performance is ______ • Salespeople are ______ ______ and ______

  25. Vertical Structure IV • Where should authority reside? • Hiring, Firing, Evaluation • Selling and Managerial Responsibilities? • Most spend about 1/3 of time on sales (vs. mgmt) • They want commission rewards • Usually needed on key accounts, especially for their sales ability • Should Sales Manager control sales-related activities? • Installation, maintenance, order processing, delivery • Usually not credit: conflict and awkward

  26. Vertical Structure V • Technology may change sales management issues as much as it has sales person issues. Cell phones, computers, etc. Quality time? • Staff Support vs. Outsourcing • Specialized knowledge • Most common: recruiting, training, sales analysis (Research?)

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