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McGraw-Hill/Irwin Copyright © 2009 by the McGraw-Hill Companies, Inc. All rights reserved.
Chapter 13
Sales and Sales
Management
THE KEY ROLES OF SALESPEOPLE
1. THE SELLING FUNCTION
2. MANAGE CUSTOMER RELATIONSHIPS
3. GATHER INFORMATION
• From Customers
• From Competitors
• About Market Forces13-3
SALES ROLE IN THE ORGANIZATION
• MANAGE RELATIONSHIPS
• CREATE CUSTOMERS FOR LIFE
• PROVIDE CUSTOMER SERVICE
• COORDINATE CORPORATE RESOURCES
• GATHERING INFORMATION
• CUSTOMER DIALOGUE IS USEFUL
• OBTAIN COMPETITIVE INFORMATION
13-4
DETERMINING THE SALES STRATEGY OPTION TO FIT YOUR CUSTOMER
1. SCRIPT-BASED SELLING—Used when all customers’ needs are similar
2. NEEDS SATISFACTION SELLING—Identifying buyers’ needs and selling to them
3. CONSULTATIVE SELLING—Bring specialized expertise for a customized solution
4. STRATEGIC PARTNER SELLING—Seller-Customer joint effort for developing product solutionsExhibit 13-1
13-5
• Limited relationships• Failure to monitor competitors or industry• Complacency
• Generate reorders• Upgrade• Full-line sell
• Secure complete commitment from both companies• Manage change
Exploration
Awareness
Commitment
Expansion
• Set correct expectations• Ensure proper initial use• Follow up• Make personal visits• Handle complaints• Achieve customer satisfaction
Dissolution
Exhibit 13-2
STAGES IN RELATIONSHIP BUILDLING
13-6
PARTNERSHIP COMMUNICATION:FROM SINGLE LEVEL TO MULTI-LEVEL
Buying Company Selling CompanyEngineeringMarketing
SalesFinance
Credit and Billing
Shipping& Receiving
ProductionMarketing
AccountingFinance
PurchasingDepartment
Shipping& Receiving
ProductionMarketing
AccountingFinance
Purchasing
Shipping& Receiving
Buying CompanyEngineeringMarketing
Credit & BillingFinance
Sales Purchasing
Shipping& Receiving
Selling Company
BEFORE PARTNERING
AFTER PARTNERING
PurchasingAgent
Salesperson
Exhibit 13-413-7
SALES ORGANIZATION OPTIONS
1. ORGANIZE GEOGRAPHICALLY USING CITIES, STATES, COUNTRIES, ZIP CODES, BY ACCOUNT
2. ORGANIZE BY PRODUCT AND DEVELOP SPECIALISTS FOR EACH PRODUCT CATEGORY
3. USE SALES TEAMS TO DEVELOP AND KEEP NEW BUSINESS.
13-8
BUYING AND SELLING TEAMS STREAMLINE MULTILEVEL SELLING
Vice PresidentOf PurchasingVice PresidentOf Purchasing
Vice PresidentOf Sales
Vice PresidentOf Sales
Director ofPurchasingDirector ofPurchasing
AccountManagerAccountManager
EngineerEngineerProduct
SpecialistProduct
Specialist
Buying Company Selling Company
Exhibit 13-513-9
CUSTOMER FOCUSED TEAM STRUCTURE
AccountConsultant
F&A Rep.Customer
Sales Specialists
AccountManager
TeamLeader
Manufacturing
Finance andAccounting
Other Business Units
OtherRep.(s)
PurchasingAgent
Shipping
CSSRep.
CustomerSupportService
Purchasing
ShippingManager
SalesSpecialists Prod. / Ind.
Mktg. Groups
Exhibit 13-713-10
Exhibit 13-8
ALLOCATION GRID FOR SALES RESOURCES
Relatively fewerresources shouldbe allocated here
Low
Maintain sufficientresources to continueto reap the salespotential and strongposition
High
Direct more salesresources here
Assign toalternative methodof communicating,such astelemarketing
Weak
Strong
MARKET LIFETIME VALUE
RELATIVEPOSITION
13-11
DO YOU OUTSOURCE THE SALES FORCE?
YES NO
• Establish relationships• Salary and selling
expenses can be limited• Little/no up-front investment
• Loss of control over sales presentation
• Products may not be aselling priority withrepresentative
TO MAKE IT WORK:
INVEST IN TRAINING ANDMERCHANDISING MATERIALS
13-12
SALES FORCE CONTROL MECHANISMS
• ESTABLISH QUOTAS – Fair and Understandable• Activity Quotas
• Performance Quotas
• ESTABLISH COMPENSATION PLAN – Equitable, Stable, Understandable
• Straight Salary
• Straight Commission
• Combination Plans
• Bonus System
• MOTIVATION ACTIVITIES– • Keep Sales Force Producing
13-13
MANAGER’S DILEMMA: EVALUATINGPERFORMANCE & MAINTAINING MOTIVATION
1. REVIEW SPECIFIC SALES OBJECTIVES
2. OBTAIN APPROPRIATE PERFORMANCE DATA
(outcomes and effort)
3. EVALUATE WHAT WAS BEYOND SALESPERSON’S
CONTROL
4. IDENTIFY PROBLEMS AND OPPORTUNITIES
5. CREATE A STRATEGY THAT RESOLVES
PROBLEMS AND SEIZES OPPORTUNITIES
5 STEPS TO EVALUATE SALES FORCE PERFORMANCE
Exhibit 13-1113-14
RECOGNIZING AND IDENTIFYING A PROBLEM
ExpectationsEnormity of problem rests on length of this difference
Results
PROBLEM RECOGNITIONPROBLEM RECOGNITION
1. Our sales are down: WHY?2. We can’t see customers: WHY?3. We can’t make appointments on time : WHY?4. We spend too much time covering territory : WHY?5. Our territories are too big : WHY?6. We don’t have enough salespeople : WHY?
THE 6xWHY FILTER Ask the WHY question at least six times(or as many times as necessary)
PROBLEM IDENTIFICATIONPROBLEM IDENTIFICATION
“The Problem”
CONCLUSION / PROBLEMWe haven’t matched demand to our sales force.
13-15