All The Following Influence Capital Budgeting Cash Flows Except Sales Management – What’s Involved? Part 1

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Sales Management – What’s Involved? Part 1

What any individual sales manager actively does depends on the size of their company, the products they sell and the way they sell them, the organization of their functions, and perhaps their own special abilities. They may perform most or all of the marketing manager’s responsibilities if this position does not exist in their company.

Essentially, however, a sales manager’s job is to generate revenue for their company through the work of the sales force they are responsible for. The size of this revenue, and the profitability (however defined) that must be shown, is usually predetermined to achieve the objectives of the company strategy. The objectives they set for the various activities involved in carrying out this task should be derived from and consistent with the company’s objectives, such as return on capital employed, cash flow, market position, growth.

Job Features of a Sales Manager

o Many factors affecting success are beyond their control (such as competitors and government regulations).

o They still need to estimate future sales and plan their operations accordingly, using their judgment and experience.

o They must depend on other departments for design, production, quality and delivery of products for which they take orders, just as those departments must depend on them to get these orders.

o The sales staff they depend on for the results they plan for often work alone, not under their immediate control.

o They are engaged in constant struggle to gain increased sales against competitors with the same objective.

Although the basic functions and skills of management, discussed later, apply to their job, it is clear that qualities such as creativity, flexibility, tenacity, and the ability to deal effectively with people will be particularly important. At the same time the ability to analyze market conditions and take sound decisions is equally essential but may not fit easily with the mentioned qualities.

Sales role

Like other managers, the sales manager relies on those who work for him to judge him, considering his job as the nature and characteristics of industrial sales and, therefore, can usefully continue by examining the salesperson’s job. .

Personal selling is one of the many possible ways of communicating with customers and potential customers but, especially where industrial goods are concerned, it is undoubtedly the most effective in achieving the objective – influencing the decision to buy. It’s also, although selling expenses are a small percentage of revenue, can be expensive. Sales personnel should therefore be considered a scarce resource, to be used as effectively as possible.

Selling yourself is a process of persuasion to bear;

– Raise awareness of a need or problem

– Establish that a need can be met by a specific type of product

– Convince the potential user that the seller’s own product can provide superior satisfaction.

Actual sales work for a particular product or company may include all three of these stages, the last two, or just the last, depending on the requirements of the situation.

– An innovative product, hitherto unknown

– A product for which there are alternatives

– An established market where the user can choose from many makes.

For economy of effort the salesperson’s function (and perhaps the type of person required) should be defined accordingly.

Other functions of sales staff

Although sales are the basic raison d’être of a salesperson and the sales manager’s purpose for hiring them, all salespeople have to spend some of their time doing other things (eg, traveling and preparing reports). However, salespeople also need to:

– Provide technical information other than strictly necessary to make the sale

– Provide some kind of after sales service

– Conduct market research (beyond the general, supply essential market intelligence about customers, competitors, etc.)

– Check the credit status of potential customers

It may or may not be that the seller is the best person to do things like this. However, it is a scarce resource, expensive and working to get orders, the cost-effectiveness of using it for such purposes should be checked against other tools – also remember that there may be some loss in sales. (“Opportunity Cost”)

Sales Manager’s Responsibilities for Sales Staff

There are some characteristics common to most types of sales:

– A smaller sales force in industrial sales than in consumer goods sales, typically dealing with a much smaller number of customers

– Decision-making responsibility and power vested in

Personal seller

– Buying decisions often require dealing with many people in the customer company.

These characteristics must influence the nature and form of a sales manager’s responsibility to his sales force.

One result may be that much of the market analysis and planning that is part of the sales manager’s responsibilities is delegated to the sales staff, who are to this extent managers of their own areas. If so, the need for clear objectives and adequate overall control is stronger if the sales force is more closely directed. It also emphasizes the importance of good communication and information flowing in both directions.

The general responsibilities of a sales manager to his sales staff can be summarized as:

o Planning

It is given human and financial resources and has to plan its utilization

Those in the most effective combination to achieve the predetermined

As a result they can only do this by knowing and understanding their staff

Nature and behavior of spending.

o Organizing

The way he develops his sales force – whether on a general or regional basis, or Specialization in product types or by class of customer or by end users – should be prepared from market studies, keeping in mind the qualifications and experience of the sales staff.

o Training

As with products, markets and objectives are constantly evolving

And change, training should be a continuous process. with small

Sales forces, formal training presents difficulties, but always the need

Look for high-quality residuals of performance.

o control

This includes setting targets and standards for measuring performance and taking appropriate action if they are not met.

o Motivation

Motivation has two effects on sales employees: the right attitude toward their job and the desire to perform their role to the best of their ability to achieve the goals set by their manager. This stems partly from training, partly from incentives (financial and otherwise) and often from the leadership provided by their manager. Regular evaluation of performance and attitude by discussion with the sales force and monitoring of their work is important for this purpose.

Recruitment of Sales Staff

It is very difficult to select a person who will be a successful member of the sales force for any particular company, whether recruited from within the company or hired from outside. This is made more difficult than it needs to be because there is not enough detail about the job the salesperson is supposed to do and, derived from that, the type of person who is likely to succeed. Such characteristics bring some objectivity to the selection process and provide some measure of comparability between candidates.

The importance of salespeople to their company, and the significant investment in them, supports a systematic approach to evaluating and making decisions about candidates as candidates. The validity of the assumptions made about them at the time of appointment should be checked for subsequent performance and the reasons for mistakes should be investigated.

The subjective element in selection will never be eliminated, and in at least one case it is a valid criterion. The person selected must be a “fit” with the team consisting of the sales manager and their sales force. If they don’t, friction is likely, no matter how well qualified and experienced they are.

Nature of Management

A sales manager may or may not be an excellent sales person. The important thing is that he should be a good manager. This is his personal and unique contribution to his company.

Essentials of management are:

measurement or assessment

Planning, which includes organizing

direction and control

Planning, and the direction and control of activities to implement the plan, depends on the collection and analysis of information, from which decisions are made.

The initial plan (ie for 12 months, on which the budget is based) results from an analysis of market and environmental factors (such as economic conditions) and an assessment of the resources available to the manager. Control requires the input of information about performance that must be measured against standards set in plans. Where there are discrepancies, the manager should decide what to do about them.

Two basic requirements for good management (in addition to the personal qualities that make a manager an acceptable leader):

Enough information

Decisions made after considering relevant information

Adequate information about the markets is difficult to obtain, and the cost of obtaining it may outweigh the benefits of having it. A sales manager is therefore often in a position to make decisions based on incomplete information or assumptions. They must then rely to some extent on past experience and their own judgment of the likelihood of this or that happening. The important thing in this situation is to record (preferably in writing) the assumptions made so that, if information falsifying these assumptions later becomes available, some evaluation of the results of the plans based on them can be made.

Copyright © 2006 Jonathan Farrington. All rights reserved

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