Principles of Sales Management and Planning

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8th Feb 2020 Business Strategy Reference this

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 SALES MANAGEMENT

 

 

     Introduction

     P1: Explain the key principles of sales management in   relation to the importance, methods of selling and sale reporting.

     M1: Evaluate how principles of sales management will be different in response to consumer and business buying behaviour.

     P2: Evaluate the benefits of sales structures and they are organised using specific organisational examples.

     M2: Critically evaluate the implementation of different types of sales structures using specific organisational example.

     P3: Analyse   the key principles and techniques for successful selling and how they contribute to building and managing customer relationships in application to specific organisational examples.

     M3: Critically analyse the application of successful selling principles and techniques in application to specific organisational examples.

     P4: Explain the importance of developing sales strategies that yield highest profitability and incorporating account management with in structures.

     M4: Evaluate how core finance principles and successful portfolio management can lead to increased profitability and a competitive edge.

     D1: Produce a coherent fully justified critical evaluation based up on a comprehensive understanding of sales management, structure and selling techniques within an organisational context.

     D2: Critically evaluate and make recommendations on how sale structures and approaches can improve financial viability.

     Conclusion

 

 

1.1  Introduction

Selling is an art and sales management is an inevitable activity to attain organizational goals. It involves various activities which involve high risk. So top-level management is always giving more priority to this activity. Sales team decides the success of a business. Sales structure creation is done by considering various aspects of a business. Sales management is the techniques of using time, humans, money, to develop a business and to run it smoothly and to make it profitable to boost the economy. A sales manager is the person who is in charge of helping and maintaining the sales team within the company. Achieving sales targets, the development of a sales plan, allocating roles are some of the responsibilities of a sales team. They are also heavily involved in the procedure of hiring and firing. The rooted down task of the marketing communications department is to originally produce marketing data that is in favour of the firm’s sales activities. The detailed discussion is done in the following sections.

P1: Explain the key principles of sales management in relation to the importance, methods of selling and sale reporting.

  • Sales Management

Sales management is the coordination and control of people and resources in an organization to effectively and efficiently attain the desired goal. The sales goal of an organization can be of wide range like increased sales volume, continuous growth and contribution to profit.

The important elements in sales management are:

• Sales Planning

• Recruitment of Sales Staff

• Sales Reporting

  • Sales Planning

Sales planning means setting the overall sales targets, quotas, demand/sales forecasting and strategy

  • Recruitment of Sales staff

  It is an integral portion of sales management. Sales manager manages the subordinates under them. Recruitment of staff means a sales manager must understand the positions which are open and place the right person in the right job and explain the job role and job description.

  • Sales Reporting

 It is the duty of the sales management team to analyze the Key Performance Indicators(KPI)of the sales team. By analyzing these indicators managers are able to understand the deviations caused and can make necessary adjustments to improve productivity. 

Sales reports are always passed up to the top management to examine the overall performance of the sales team and salesperson individually.

  • Sales Force

Sales management is the function of establishing a sales force, controlling sales operation which builds the team and implementing sales strategy which defines the sales process that permits a business to grow its heights. The three key areas of sales are

• Sales operation

• Sales strategy

• Sales Analysis

Sales forces are connected with a management information system (MIS), as it is an information system it is used in customer relationship Management (CRM). Salesforce is an important element in sales management. By providing adequate training and compensation package a company can acquire a dynamic sales force.

  • Personal Sales

The other name of personal selling is face-to-face selling in which salesperson tries to explain the need and benefit of products. Using the interpersonal skill of the salesperson he /she persuade the customer to buy a product.  It is a promotional technique adopted in sales management for sales growth. If a product is new to the market the company will adopt personal sales.

  • Sales Environment

The resources and factor influences are called Environment. In the sales environment sales person (sales clerk) and the customer are included. Sales clerk should feel comfortable in selling the product and she should enjoy talking to people. Then only he can persuade customers to buy the products he sells.

  • Different sales Methods

One-off Selling: in one-off selling where the relationship is unimportant. It is the sales what we see in retail shops.

Relationship Selling: it is Business to Business (B2B) selling where one company sells its products to another company. Example:  a cotton cloth manufacturing company sells its products to a shirt manufacturing company.

Customer-centric selling: Making a positive environment to the customer at the place of sale or point of sale and after-sales period. This approach can add value to the organization and making it unique and give a competitive edge in the industry.

  • Different Functions of Sales Management
  • Sales Research 
  • Sales Planning
  • Coordination of activities related to sales
  • Selling and administrative cost
  • Sales budget
  • Price determination

    • Establishment of sales region or area
    • Coordination of sales related activities.
  • Importance of Sales Management
  • It can reduce the cost related to selling, administration, and distribution
  • It helps in the exploration of new markets
  • It helps in the launch of new products in the markets
  • It leverages the sales of existing products
  • It also helps to rise in GDP of its country.

 

M1: Evaluate how principles of sales management will be different in response to consumer and business buying behaviour.

The sales management helps in the systematic functioning of the organizational activities and in molding a sustainable business in a market environment that is highly competitive.

  • Structure and strategy

It is necessary to track the journey of the product and the customer. This information would be later beneficial in knowing user preferences and making more products with the preferred improvements or additions.

In overall, employing these 6 methods can ensure better prosperity for business within a market.

Changing lifestyles have contributed to the creation of a consumerist society which prefers to purchase more. But people are hindered with the rising debt rates, increase in taxes and the rise of inflation.

As a marketer, tracking customer information as early as possible to predict their interests and habits is important to make the right decisions at the right time is important in marketing. The matter can be dealt with using six methods (IBM Institute for Business Value, “Redefining Markets: Insights from the Global C-suite Study—The CMO perspective,” January).

  • At the specific time the appropriate information

Business should not confine to zooming in and scanning out the beneficial data on customer relations. It should also focus on the individuality of the customer.

  • Strictly disciplined responsibilities

It is necessary to spot the customers in need of constant attention from their business. The job would be easily done with the identification of the target market.

  • Anticipating apparatus

Keeping up with the current trends is indeed essential for the business to prosper. This would require proper analysis and evaluation of customer trends and behaviours and focus on the right products at affordable prices and customer services.

 

  • The adaptability to examine and to delve

 Mere data analysis is not enough for the business to work smoothly. Plotting what if questions and boosting ideas is necessary to enhance business ideas.

  • The skill to link

The company must have the ability to classify information of both customers and employers to bring out their maximum potential. The company IBM uses these methods.

B2B is transferring data, work, and goods from a company to another company. It is called (e-biz) for transferring products and for data, it is called (aka e-commerce). Company obtaining a broker could store the stock for separate dealers.

 When goods or service reaches directly to customer from an organization, it is called B2C E.g., dining from a restaurant and shopping from a megastore. B2B e-commerce is online purchase between two business organizations. On the other hand, B2C e-commerce is an online purchase for a customer from a shop. For example, online shopping for cloth or grocery. Online shopping helps in saving time, cuts down the cost and gives a stress and hassle-free shopping experience. However, at times, these products are sent back to the company which is a major disadvantage of B2C e-commerce. 

P2: Evaluate the benefits of sales structures and they are organised using specific organisational examples.

Marks and Spenser use the horizontal structure for sales management which gives employers more power in decision making.

  • Recruiting

The sales manager recruits applicants whose who fit for the company’s specified job profile. Marks and Spencer have employment agencies for their jobs. Their head office in London selects employees for department stores.

  • Training &Development

Marks and Spencer are providing offsite and on duty training for employees to improve their experience and knowledge to work in the changing society.  Marks and Spencer store in Farringdon conducting how employees benefiting through training and improve the skills and knowledge of the employees also researching progress (Mikkelsen2005). Marks and Spencer is well-branded company To encourage the employees M&S giving pensions, health insurance and visible presents such as clothing homeware.

M2: Critically evaluate the implementation of different types of sales structures using specific organisational example.

Business is organized according to their roles and skills into smaller groups or departments. Based on sales, the organization has been classified which is known as sales structure. This may include, for example, sales. Different types of sales structures are given below.

  • Geological

Natural resources are important in developing sustainable business and maintaining it. M&S is working effectively with many companies to draw maximum benefits from natural resources

(M&S and WWF: The Water Stewardship Journey for Businesses (November 2016)

M&S Farming for the Future Annual Report 2016 (April 2016)

M&S Farming for the Future Annual Report 2015 (April 201)

  • Marketing

Marks and Spencer are working in collaboration with research agencies and have marketing specialists to predict our current needs and demands of the people and competitors.

The USP that has been identified for M&S sells products of a high range which made them acquire about 32 million customers. A major disadvantage to which how M&S currently operates is that they have strong competition abroad and local. This is because of the competition faced by M&S from stores like Aldi, Tesco, Asda, and Lidl. Operating abroad has also caused them to be in a riff with foreign businesses. But if Marks and Spencer set their aims and objectives correctly then they can overcome these problems. The Company’s legal and ethical policies are available in (https/help.marksandspencer.com/support/legal-and-ethical/1). With Constant training, employees are able to use technology easily like increase the product sale company is growing. For customer motivation to buy from M&S granted quality product and a middle-class customer can afford for good quality.

The products of M&S are sold both in stores and online.

P3: Analyse   the key principles and techniques for successful selling and how they contribute to building and managing customer relationships in application to specific organisational examples.

The key principles and techniques of successful selling are detailed in the following sections.

  • Efficient and active

Reaching out to the distributors is an important part in making good sales. Distributors can spot the potential local areas and threats that can hinder the business and provide solutions for them thereby make a better business.

  • Extensive range of customers

Distributors are skilled in acquiring a wide variety of customers. Starting a business in a new area would pose a major problem with zooming into the customer population. Distributors play a major role in such a scenario.

  • Knowledge of the market

Distributors are well versed with knowledge about the market which allows them to connect with people with similar interests and potential buyers. Their advice and opinions are inevitable for developing business

  • Transaction plus Retailing

Deliverers are experienced retailers whose prime intention is to sell the stored products and promote themselves as a good seller of products.

  • Inspired

The deliverers sell the stored goods by themselves. As the stored goods are resold, it would increase their earnings tremendously and thus the sale would end in a short time.

  • Strategy

Distributors use big trucks for transporting the goods. They either employ or themselves are good drivers. All Manufacturers might not be able to provide for the transportation of goods.

  • Storehouse

Storing the goods has to be done in a strategic manner. Once the goods have been manufactured, it has to be preserved well until sold off. Distributors can store the goods in small spaces in warehouses.

  • Trading route

The products hit the market and small stores in residential areas through distributors in the manufacturer’s absence.

Fiscal Preserving. Each business focuses on spending less and saving more. Distributors would help to sell out the products that get quickly sold off.

  • Direction via wholesale

Business would benefit from creative distributors for their ability in making the product highlighted. Convenience store suppliers play a major role in setting business. They have a way to delve into the market.https://www.thespruceeats.com/teas-of-india-764590

M3: Critically analyse the application of successful selling principles and techniques in application to specific organisational examples.

Unilever example is an ideal one to study the successful selling principles. Few principles and techniques used by them are given below.

Converting first-time customers into the regular customer is one of the selling principle used by Unilever in their successful selling management. Unilever successfully positioned their product in the customer mind. The closing sale concept is effectively used by them.  Giving samples, coupons, price pack offers etc. are some of the product promotional tools used by Unilever.

 

 

P4: Explain the importance of developing sales strategies that yield highest profitability and incorporating account management with in structures.

By preserving existing sales structure and attaining huge profitability is a dream for any company.  Increasing individual sales is one of the techniques used for this purpose. Attracting frequent buyers and following the current trends are also popular tools to achieve the above-mentioned purpose.  There are a lot of sales strategies experimented by different organizations to get maximum benefits using structure. Seasonal pricing is a popular one nowadays.

M4: Evaluate how core finance principles and successful portfolio management can lead to increased profitability and a competitive edge.

Finance principles focus on managers, investors, and government agencies to do with financial information for enhancing the return. Few principles are given below.

  • Diversify 

 Diversification is a way to minimize the risk involved in the business. Instead of investing in one sector, considering more sectors is a good choice.

  • Averaging Plan

Consistent savings must be invested regularly during good markets and bad. Investing in an average manner irrespective of the market fluctuation makes sense.

  • Invest for the long term

Time and return are a powerful combination for potentially growing your wealth. The best investment plan is to go for long-term investment to get good benefits.

  • Focus on what is in your control

 An investor must be able to keep the control of portfolio as per his/her plan based on strategies.  

  • Rebalance regularly

 Investors can follow active revision policy by a regular rebalancing of the portfolio through buying low and selling high by reallocating your portfolio to its original investment mix. 

  • Maintain liquidity

 Liquidity maintains is important when the business is going through a bad patch. Liquidity means converting fixed assets into cash quickly. It avoids pressure on the daily business deals.

  • Normal market volatility

 Market fluctuations are a part of a game. It is not wise to take the decision based on short period market volatility. 

  • Emotional Balance

Maintaining a good emotional balance is a must in running a business. Expecting more revenue in a short period is not a good business strategy.

There are different types of investment styles. Choosing a suitable style is influenced by various factors including some political situations. There are different models available to measure the performance of portfolio management.

 

D1: Produce a coherent fully justified critical evaluation based up on a comprehensive understanding of sales management, structure and selling techniques within an organisational context.

Sales management deals with the sales techniques and the sales activities of the firm. It’s a pivotal activity in achieving the sales objectives of the organization. It’s the responsibility of the top level management to formulate appropriates sales management procedure. Sales operation, strategy, and analysis are a part of sales management.

The process starts with the planning and the recruitment of sales staff, reporting etc. are involved in this process.

Top level management decides which sales structure should be followed by the organization to achieve the targeted revenue and margin. Territory designing is important and it is largely relying on the target customer. Dividing territories are done by considering sales approach, competition, product etc.

One of the aggressive sales model popular in the industry is the island model. The assembly line model concentrates on maximum utilization of sales force. The pod structure is becoming more popular nowadays since some industry is focusing on niche markets.

Unilever implemented an appropriate strategy to gain the edge over the competitors. Unilver selected a right sales structure that clearly clarifies the responsibility of a sales representative and sales manager. After evaluating Unilever sales strategy, the report clearly indicates that Unilever sales funnel strategy is the key driver. Moreover, selecting an appropriate strategy, choosing the systematic sales plans and follow up action generates more profit for an organization. So the sales department of Unilever given ample importance in choosing the right sales strategy, sales structure, consumer promotional tools to reach customers.

Sale representatives are happy to work in the Business to Business sector due to its flexibility and low systematic nature. The action of sale is reshowing to each customer the reason which is important for buying the product. Otherwise, if it gets wrong all sales go down. So sale person must understand the purchaser from the beginning of selling to finish the sale of products. All sale person need to investigate the market and customer’s habit before making a sales plan. It is important to contact with customer regularly via e-mail or other facilities in order to make the customers stick on with the purchase. Every salesperson should recognize the appropriate method of selling. It is important to learn from a mistake. Customer relationship is very important and always give priority to customers. Do not damage the customer relationship and doing so will lead to poor performance in business. Sale managers and salespersons should work intentionally for the benefit of the company. Every salesperson should tackle the customer’s buying habit with their strategic approach

Researchers suggest that in order to do a successful sale, a strategic plan has to be made properly. For example, the TAS Group, with reference to the Dealmaker Index Study, states that 70% of the companies that follow a structured process in sales are high performers; over 70% of business forecasts were accurate for the companies with a defined sales process.

Some of the sales promotion tools are giving samples, gift coupons, price packs, patronage awards, free trials etc. There are several factors affecting the sales promotion plans. It is vital to have a concrete study before making a sales promotion plan.

 

D2: Critically evaluate and make recommendations on how sale structures and approaches can improve financial viability.

Salesforce structure plays a key role in improving financial viability. It has an impact on revenue generation. Sometimes, companies go for the restructuring of the sales force as a long-term investment. It is a proactive activity to boost sales. Usually, the sales manager does inspect the performance of the sales force and makes a recommendation to higher management. The frequency of doing sales restructuring is a strategic decision and it depends on several factors.

One of the advantages of doing restructuring is to improve the efficiency of the sales team. It will help to assign the right person at the right place. Top sales executives can be identified easily and can give them more duties. Communication can be made more effective by doing the restructuring activity. The sales force restructuring should align with the organization structure for the smooth flow of information.               

One of the criteria for selecting an organizational structure of a company is based on the nature of the business associated with that company. Management literature discusses different organization structures by considering various business scenarios. Bad organizational structure leads to failure in achieving business objectives. It is important to have a good organizational structure for improving internal communication, handling customer requirements, making good business decisions and in performing various management activities.

Benefits of an Effective Sales Organisational Structure:

Following are the requirement for a good sales organizational structure that leads to the financial viability of the concern.

• identify sales talent

• Defining reporting structure

• Defining employee’s responsibility

• Measuring performance standard

• Creating a framework for replacement options in the sales department

• Identifying top performers in the sales department

• Redistributing right sales person on the right territory

• Provides accountability

• Room for talent development

Conclusion

This assignment summarises the principles of sales management, sales management process and sales strategy followed in a company to achieve the organizational goals. Importance of key financial concepts and portfolio management principles have also been evaluated. Importance of sales structure and their applications are discussed and evaluated in this assignment. Sales management is a most important process of determining success in business. Sales goals of the organization have also been studied in detail.

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