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Sales management

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Sales management

  1. 1. Sales Management 1
  2. 2. Sales Management 1. Sales – Cost of Sales = Gross Margin 2
  3. 3. Sales Management 1. Sales – Cost of Sales = Gross Margin GM – Expenses = Net Profit 3
  4. 4. Sales Management 1. Sales – Cost of Sales = Gross Margin GM – Expenses = Net Profit 2. Volumes vs Profits 4
  5. 5. Sales Management 1. Sales – Cost of Sales = Gross Margin GM – Expenses = Net Profit 2. Volumes vs Profits 3. Marketing vis-à-vis Sales 5
  6. 6. 4. Responsibilities  Sales Planning / Budgeting  Estimating Demand / Forecasting Sales  Understanding the Sales Organization  Recruiting / Training Selecting Sales Force  Compensating / Motivating / Leading  Sales Quotas  Analyzing Sales Cost / Volume / Profit  Evaluating Sales Force 6
  7. 7. 5. Recent Trends in Sales Management  Foreign Competition 7
  8. 8. 5. Recent Trends in Sales Management  Foreign Competition  Rising Customer Expectations 8
  9. 9. 5. Recent Trends in Sales Management  Foreign Competition  Rising Customer Expectations  Increasing Buyer Expertise 9
  10. 10. 5. Recent Trends in Sales Management  Foreign Competition  Rising Customer Expectations  Increasing Buyer Expertise  IT & Communications 10
  11. 11. 5. Recent Trends in Sales Management  Foreign Competition  Rising Customer Expectations  Increasing Buyer Expertise  IT & Communications  Women in Sales Careers 11
  12. 12. 5. Recent Trends in Sales Management  Foreign Competition  Rising Customer Expectations  Increasing Buyer Expertise  IT & Communications  Women in Sales Careers  Controlling Costs 12
  13. 13. Effective Sales Executive What does he do? 13
  14. 14. Effective Sales Executive What does he do? i. Operating Function ii. Planning Function 14
  15. 15. Planning Function  Selling Accounts  Sales Force Management  Coordinating with other functions  Dealer Handling  Communicating / Coordinating with Marketing  Sets Personal Selling Goals  Sales Organization  Selling Strategies  Staffing, Developing Skills  Providing Leadership  Developing Sales Programs  Customer / Dealer Relationships 15
  16. 16. The Effective Sales Executive Who is an effective sales executive? 16
  17. 17. The Effective Sales Executive Who is an effective sales executive?  Defines exact function & duties of person vis-à-vis company goals 17
  18. 18. The Effective Sales Executive Who is an effective sales executive?  Defines exact function & duties of person vis-à-vis company goals  Able to select & train capable subordinates & delegates authority – empowerment – least supervision 18
  19. 19. The Effective Sales Executive Who is an effective sales executive?  Defines exact function & duties of person vis-à-vis company goals  Able to select & train capable subordinates & delegates authority – empowerment – least supervision  Time utilization Time for thinking & planning Time for office / field 19
  20. 20. The Effective Sales Executive Who is an effective sales executive?  Defines exact function & duties of person vis-à-vis company goals  Able to select & train capable subordinates & delegates authority – empowerment – least supervision  Time utilization Time for thinking & planning Time for office / field  Act as skilled leaders, motivate people 20
  21. 21. Interrelationships Top Management  Integrate personal goals with organization  Don’t aim to be indispensable; delegate authority  Good problem solvers & decision makers  Keep management involved  Listens & keeps record of important conversations  Follows given code of conduct 21
  22. 22. Product Management Regular involvement for new products, product quality, services rendered 22
  23. 23. Pricing Management Since sales has the pulse of the market policies are co- operative decisions. 23
  24. 24. Distribution Management Marketing channels determine the pattern of sales force operations – the no. of outlets. 24
  25. 25. Promotion Management  SEs implement promotional plans.  Personal selling is an important promotional tool, expenses have to be controlled.  Provide important information to advertising department regarding consumers, motives, behaviours 25
  26. 26. Sales Planning 1. Setting Objectives a) Internal Situation Analysis  SWOT of Sales Force  Who will sell, what selling methods, what sales tools, what are available 26
  27. 27. Sales Planning 1. Setting Objectives a) Internal Situation Analysis  SWOT of Sales Force  Who will sell, what selling methods, what sales tools, what are available b) External Environment Audit  PEST Analysis  Competition 27
  28. 28.  Sales objectives derived from broader Marketing objectives / Corporative objectives. 28
  29. 29.  Sales objectives derived from broader Marketing objectives / Corporative objectives.  Must align with corporate vision 29
  30. 30.  Sales objectives derived from broader Marketing objectives / Corporate objectives.  Must align with corporate vision  Set at various levels: Macro (Country / Geographic region): Micro (Key accounts) 30
  31. 31.  Sales objectives derived from broader Marketing objectives / Corporative objectives.  Must align with corporate vision  Set at various levels: Macro (Country / Geographic region): Micro (Key accounts)  Long Term vs Short Term, Accuracy decreases over long periods … 31
  32. 32.  Sales objectives derived from broader Marketing objectives / Corporative objectives.  Must align with corporate vision  Set at various levels: Macro (Country / Geographic region): Micro (Key accounts)  Long Term vs Short Term, Accuracy decreases over long periods …  Output oriented: ‘Increase Sales’ (X) Increase Sales by 10% 32
  33. 33.  Sales objectives derived from broader Marketing objectives / Corporative objectives.  Must align with corporate vision  Set at various levels: Macro (Country / Geographic region): Micro (Key accounts)  Long Term vs Short Term, Accuracy decreases over long periods …  Output oriented: ‘Increase Sales’ (X) Increase Sales by 10%  Measurable: ‘X’ no. of calls / month … How to measure soft objectives?? Morale? 33
  34. 34. 2. Determining Operations to meet Objectives  Decide on Sales Strategies SS: Operations which organize & direct sales activities to help achieve objectives 34
  35. 35. 2. Determining Operations to meet Objectives  Decide on Sales Strategies SS: Operations which organize & direct sales activities to help achieve objectives  Strategy for each objective …. In Sync. with Corporate Objective …. 35
  36. 36. 2. Determining Operations to meet Objectives  Decide on Sales Strategies SS: Operations which organize & direct sales activities to help achieve objectives  Strategy for each objective …. In Sync. with Corporate Objective …. ‘Build’ – Emphasis on new / current A/cs Increase Sales ‘Hold’ – Consolidating relationships to improve organizational image ‘Harvest’ – Reduce overall operation costs Sales directed to most profitable customers Objectives & strategies: corporate / sales have to be broken into individual sales objectives. 36
  37. 37. 3. Organizing for Action Next Step: Objectives – tactics 37
  38. 38. 3. Organizing for Action Next Step: Objectives – tactics  Which customers to target?  Which products to highlight in range? 38
  39. 39. 3. Organizing for Action Next Step: Objectives – tactics  Which customers to target?  Which products to highlight in range?  How is sales department working? 39
  40. 40. 3. Organizing for Action Next Step: Objectives – tactics  Which customers to target?  Which products to highlight in range?  How is sales department working?  Is compensation plan suitable? Is it in sync. with industry average? 40
  41. 41. 3. Organizing for Action Next Step: Objectives – tactics  Which customers to target?  Which products to highlight in range?  How is sales department working?  Is compensation plan suitable? Is it in sync. with industry average?  How to introduce a new product line. 41
  42. 42. 4. Implementing Two fold role of Sales Manager a) Division of responsibilities among salespeople; tasks; time sequence; Review Schedule b) Communicate to and coach sales people to implement sales strategies and actions 42
  43. 43. 5. Measuring Results Against Standards i. Establish Standards ii. Measure Performance iii. Reevaluate and correct variations from standards 43
  44. 44. 5. Measuring Results Against Standards i. Establish Standards ii. Measure Performance iii. Reevaluate and correct variations from standards Performance standards needed to measure results: Industry averages, past sales force performance 44
  45. 45. 5. Measuring Results Against Standards i. Establish Standards ii. Measure Performance iii. Reevaluate and correct variations from standards Performance standards needed to measure results: Industry averages, past sales force performance Performance measures: Sales volumes, selling costs, market shares, profit margins 45
  46. 46. 6. Re-evaluating and Control  Can start mid way during implementation of sales plan or at the end  Monitored constantly for effective control and to see objectives are met (annual target 10 crores: 2.5 per quarter) 46
  47. 47. Why does planning fail? 1. Lack of understanding of important issues: Sales objective different from corporate objective….., SM planning without reference to abilities of sales force, Environmental changes…., Inadequate understanding of competitors policies / organization strength and weaknesses etc. 47
  48. 48. Why does planning fail? 1. Lack of understanding of important issues: Sales objective different from corporate objective….., SM planning without reference to abilities of sales force, Environmental changes…., Inadequate understanding of competitors policies / organization strength and weaknesses etc. 2. Absence of proper planning: SMs: May developed plan which are only numbers and don’t focus on company issues, extra knowledge environment competition. 48
  49. 49. Why does planning fail? (Contd..) 3. Inadequate communication 49
  50. 50. Why does planning fail? (Contd..) 3. Inadequate communication 4. Lack of sales force involvement: If sales people are not involved during planning, they are demotivated 50
  51. 51. Why does planning fail? (Contd..) 3. Inadequate communication 4. Lack of sales force involvement: If sales people are not involved during planning, they are demotivated 5. Inaccuracy in sales planning Mistakes in forecasting, budgeting and territory management; plans more accurate with bottoms – up approach; objectives should be set by top management and supported by sales managers 51

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