Sales Management

Sales Organizations and management of sales territories

Sales Organizations
Structural Entities - execute a combined sales plan Mutually agreed business goals with clear structure Roles, responsibilities, duties, rights for each person, group And & departments Vehicle for achieving goals, higher sales, market share and customer loyalty Functions carefully planned & coordinated Upward downward communication for sales related decisions

Organizational principles
Creation of SBUs for better coordination, function & service

Broad / Narrow span of control & supervision

Centralized selection, recruitment, territory allocation and supervision at corporate level Decentralized responsibility rests with field Sales Manager Many organizations follow both Training, recruitment (De Centralized) Customer service( Centralized)

Sales Organization
Line organization (one man show)
VP Marketing President / owner VP sales 5 SPs NSM Div mgrs( E/N/W) RSM DSM Sales staff

organization by geographical specialization

Sales Organization
Orgzn by product President Mkt PM(A) orgzn by customers President (Mkt) VP sales

Mgr(sls) Mgr(Tr)

Mgr(prom)

SM SM SM ind cus whole sl retail SP SP SP

PM(B)

Sales Organization
Combined sales organization President Functional Geographic Customer VP producn VP Mkt Mkt Mgr GM consum DM soap East sls div GM intnl VP HR

DM paper GM food Nth sls div

West sls div

Management of Sales Territories

Management of sales territories

Sales territory is a geographical area assigned to individual sales person for servicing the customer Sales territory- group of present & potential customers assigned to an individual SP group or dealer

Sales territory economic unit used in planning and controlling sales effort
Has direct bearing on companys sales & profitability Improper territory management - high cost and loss o Sales to competitors Helps in better sales planning & effective operational control

Management of sales territories advantages

For better market coverage For effective utilization of sales force For efficient distribution of work load among Sales Persons For convenient way to evaluate performance of SP For control over direct, indirect cost of sales function For better control / monitor /sales measurement by SM

For better understanding of customer needs, loyalty & personal rapport, quick disposal of complaints
For effective utilization of marketing resources

Objectives of sales territories

Distribution of work load among sales persons becomes easy and manageable

To improve market coverage( efficiently & economically)

To reduce selling expense ratio( proper routing)

To improve customer service( regular contact & relationship)

To coordinate personal selling & advertising efforts To improve sales force performance To meet competition more effectively To increase profitability of sales

Allocation of sales territories

SM should consider uniform allocation & coverage

Avoid duplication of efforts(no 2 SPs covering same area)

Specific time period to assess performance Every Sales Person should have an equal distribution of opportunities & responsibilities for correct evaluation Provide flexibility( changes done without disturbing structure)

New sales men work under the supervision of experienced sales person for some time

Designing sales territories

Designing factors: Size of the organization & level of competition

In each product category, number and quality level of product in portfolio, merger or takeover

Territory design
Charts, maps, geographical /Topographical /demographical data, transportation, communication, settlement pattern, spread of retail outlet Trading areas economic factors, consumer buying habits, & normal trading pattern Competitive position, sales potential, present & prospect customer on the basis of age, sex, likes and dislikes

Location of SP in term of market accessibility and family proximity, territory shape & traveling time

Routing, scheduling and time management

Reduction in travel time & cost increase selling time and improve territory coverage Straight line / Hopscotch Base C1

C5
C4

C3

C2

Circular

Clover Leaf

Territory management & strategic planning

high
Opportunity High potential-differential advantage Strategy Commit high level of Sales resources Opportunity Good opportunity but competitive disadvantage Strategy Improve by high allocation or shift resources

low

Opportunity Stable opportunity & Differential advantage Strategy Allocate moderate Level of resources

Opportunity Little opportunity & competitive disadvantage Strategy Commit minimal level of resources or quit

strong

weak