1

SELLING PROCESS &

SALES MANAGEMENT
Unit B B1 B2 B3
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Selling Process B1
Sales is a key part of any business, helping companies grow while building a
strong customer base. Learning about the selling process can help you find
potential buyers or prospective clients, increase your overall sales and nurture
your relationship with consumers.
Key takeaways:
• The selling process is the interaction between a salesperson and their
potential buyer. There are seven common steps to the selling process:
prospecting, preparation, approach, presentation, handling objections, closing
and follow-up.
• The first three steps of the selling process involve research into prospects’
wants and needs, with your presentation midway through the selling process.
The final four steps include addressing any questions or concerns, then
closing the deal and maintaining your connection.
• Both business-to-business (B2B) and business-to-consumer (B2C)
salespeople follow the same general selling process to connect with
prospective clients and build a strong customer base.
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Selling Process
What is the selling process?
• The selling process is the interaction between a seller and a potential buyer
or client. It's generally a method businesses can replicate for consistent
performance among salespeople. Businesses use the common seven steps
of the selling process to complete sales and ensure continued profits.
7-step sales process: When to use it and when to break it
• The 7-step sales process
• Prospecting
• Preparation
• Approach
• Presentation
• Handling objections
• Closing
• Follow-up
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Selling Process
The seven-step sales process is not only a good start to customizing it to your
particular business but more importantly, customizing it to your target
customers as you move them through the sales funnel.
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Selling Process
The textbook 7-step sales process
What are the seven steps of the sales process according to most sales masters?
The following steps provide a good outline for what you should be doing to find
potential customers, close the sale, and retain your clients for repeat business
and referrals in the future.
1. Prospecting
• The first step in the sales process is prospecting. In this stage, you find
potential customers and determine whether they have a need for your product
or service—and whether they can afford what you offer. Evaluating whether the
customers need your product or service and can afford it is known as qualifying.
2. Preparation
• The next step is preparing for initial contact with a potential customer,
researching the market and collecting all relevant information regarding your
product or service. Develop your sales presentation and tailor it to your potential
client’s particular needs. Preparation is key to setting you up for success. The
better you understand your prospect and their needs, the better you can
address their objections and set yourself apart from the competition.
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Selling Process
3. Approach
• Next, make first contact with your client. This is called the approach.
Sometimes this is a face-to-face meeting, sometimes it’s over the phone.
There are three common approach methods.
• Premium approach: Presenting your potential client with a gift at the
beginning of your interaction
• Question approach: Asking a question to get the prospect interested
• Product approach: Giving the prospect a sample or a free trial to review and
evaluate your service
4. Presentation
• In the presentation phase, you actively demonstrate how your product or
service meets the needs of your potential customer. The word presentation
implies using PowerPoint and giving a sales spiel, but it doesn’t always have
to be that way—you should actively listen to your customer’s needs and then
act and respond accordingly.
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Selling Process
5. Handling objections
• Perhaps the most underrated step of the sales process is handling objections.
This is where you listen to your prospect’s concerns and address them. It’s
also where many unsuccessful salespeople drop out of the process—44% of
salespeople abandoning pursuit after one rejection, 22% after two rejections,
14% after three, and 12% after four, even though 80% of sales require at
least five follow-ups to convert. Successfully handling objections and
alleviating concerns separates good salespeople from bad and great from
good.
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Selling Process
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Selling Process
6. Closing
• In the closing stage, you get the decision from the client to move forward. Depending
on your business, you might try one of these three closing techniques.
• Alternative choice close: Assuming the sale and offering the prospect a choice, where
both options close the sale—for example, “Will you be paying the whole fee up front
or in installments?” or “Will that be cash or charge?”
• Extra inducement close: Offering something extra to get the prospect to close, such
as a free month of service or a discount
• Standing room only close: Creating urgency by expressing that time is of the essence
—for example, “The price will be going up after this month” or “We only have six
spots left”
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Selling Process
7. Follow-up
• Once you have closed the sale, your job is not done. The follow-up stage keeps
you in contact with customers you have closed, not only for potential repeat
business but for referrals as well. And since retaining current customers is six to
seven times less costly than acquiring new ones, maintaining relationships is key.
Sales process takeaways: What’s important?
• Now that you understand the basic seven stages of sales process development,
you can begin to tailor them to your own product or service and customer base.
Cut out steps that are unnecessary to your particular business and focus on your
customer. You know the rules—now get ready to break them in ways that bring you
closer to your customer and turn you from a sales professional to a sales artist.
Whatever approach you take, keep these fundamentals in mind:
Identifying the customer’s problem
• You have a product or service you want to sell—now what? Anyone with a problem
related to your area of expertise can be a potential customer. You'll need to dive
deep into discovery work to learn each buyer's specific goals, needs, and pain
points.
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Selling Process
Develop a solution for the customer
• Once you have uncovered problems for your products to solve, tailor your
offerings to fix those issues—and be prepared to explain how your product
truly is a solution for the given problems.
Be persistent
• Following up isn’t just for after the close to get repeat business. As stated
before, most customers don’t buy right away. You have to handle objections
and try, try, try again. This is where the seven-step sales process doesn’t
account for repeated approaches, presentations, meetings, or phone calls
where you handle objections. If it did, it might be a 13-step sales process or a
21-step sales process, or… you get the idea.
• Bottom line: stay connected—set up a calendar for repeated contact with
potential, present, and past customers so you're more likely to reach them
when they're ready to buy.
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Sales Forecasting B2
What is Sales Forecast?
Sales forecasting is the process of estimating a company’s sales revenue
for a specific time period – commonly a month, quarter, or year. A sales
forecast is prediction of how much a company will sell in the future.
All sales forecasts answer two key questions:
• How much: Each sales opportunity has its own projected amount it’ll bring
into the business. Whether that’s $500 or $5 million, sales teams have to
come up with one number representing that new business. To create the
number, they take everything they know about the prospect into account.
• When: Sales forecasts pinpoint a month, quarter, or year when the sales
team expects the revenue to hit.
• Producing an accurate sales forecast is vital to business success. Hiring,
payroll, compensation, inventory management, and marketing all depend on
it. Public companies can quickly lose credibility if they miss a forecast.
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Sales Forecasting
• Forecasting goes hand-in-hand with sales pipeline management. Getting an
accurate picture of qualification, engagement, and velocity for each deal helps
sales reps and managers provide data for a reliable sales forecast.
• A forecast is different than sales targets, which are the sales an enterprise
hopes to achieve. A sales forecast uses a variety of data points to provide an
accurate prediction of future sales performance.
Sales forecasting methods and techniques
Although different organizations can have vastly different sales structures and
processes, the majority tend to use one or a combination of the following
primary approaches to sales forecasting:
Use of historical data to forecast future results. Looking at historical data is
perhaps the most common as well as straightforward approach. The data is
readily available, and it makes sense that variations based on factors like
seasonality and new product introductions would provide directional insight.
The limitation, of course, is that external, macro trends that impact sales aren’t
necessarily considered – at least not in a systematic fashion.
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Sales Forecasting
Funnel-based forecasting. For many companies, the current state of the
sales funnel is viewed as the most accurate predictor of likely sales outcomes.
As long as sellers are providing accurate and frequently updated information
about the state of given pursuits, use of the funnel can be a reasonably reliable
means upon which to make forecasts.
Forecasting based on multiple variables. Given that both of the above
approaches have inherent limitations, some organizations are looking to build
more complex forecasting models that incorporate techniques such as
intelligent lead scoring alongside macro factors that are likely to impact the
closing of deals. The trick is to put in place an approach that’s sophisticated
enough to be meaningful without being too complex to manage and maintain.
Make assumptions and adjust as needed
In any forecasting process, there will always be some uncertainty. Rather than
agonizing over small details, make assumptions and adjust your forecast as
new information becomes available
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Sales Forecasting
Be flexible
Sales forecasts are not set in stone. As new information becomes available, be
willing to adjust your forecast accordingly. The goal is to get as close as
possible to an accurate prediction, not to be perfect.
Use market analysis tools
One way to get insights into future sales trends is to use market analysis tools
like Google Trends or Forrester Research. These tools can help you identify
emerging trends that could impact your sales.
Common sales forecasting mistakes
Enterprises continue to make the same mistakes in their forecasting
processes. Here are some of the common pitfalls
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Sales Forecasting
Sales data fails to provide insight into deal status. A limitation of existing
forecast approaches is they are heavily reliant on sellers to provide accurate
information about the status of specific opportunities. Given the pressure on
sellers, it’s not surprising that the information they provide is often rosier than
the reality.
Time-consuming manual processes cut into valuable selling time. It’s
estimated that sales reps spend 2.5 hours per week on forecasting, while their
managers spend an average of 1.5 hours. Every hour that’s devoted to these
time-consuming – and manual – activities would be better spent on actual
sales.
In the push to commit revenue, accuracy is often sacrificed. Under
pressure to provide positive numbers, sellers typically overestimate the number
of deals that will close. Perhaps not surprisingly, 79% of sales organizations
report typically missing their forecasts by more than 10%. Meanwhile, 54% of
the deals forecast by reps never close.
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Sales Forecasting
Fortunately, there are ways sales organizations can build a forecast
process that helps achieve greater accuracy – and, ultimately, better sales
results.
At the most fundamental level, improving sales forecasting means using data to
more accurately predict performance and manage planning to ensure sales
success. This includes steps like:
• Ensuring common agreement about the sales process. Seems like a no-
brainer, right? Your sales teams operate from a common lexicon about the
sales funnel and the stages within it that your organization employs. In reality,
there’s frequently a genuine disconnect.
• Set realistic sales goals or quotas and communicate them. Again, this
may seem obvious. But many companies either set unrealistic sales quotas,
or fail to effectively communicate individual goals and how they ladder up to
the broader plan.
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Sales Forecasting
• Benchmark your basic sales metrics. Forecasting involves using historical
data to effectively estimate future results. Benchmarking ensures that there’s
a sound basis for comparison with prior results.
• Understand your current sales pipeline. If you want to achieve better
forecasting, accuracy starts now. New technologies provide sales teams with
intelligence that enables them to scrub leads that aren’t actually viable,
realistically assess those that are, rescue ones at risk, and commit to a higher
degree of precision going forward.
You can only drive accuracy in forecasting if salespeople don’t feel
pressure to inflate the forecast.
And, by extension, they need to feel comfortable sharing information about
deals even when it is not favorable.
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Sales Forecasting
Sales forecasting: Key takeaways
• Sales forecasting is an educated guess about future sales revenue that uses
historical data and common sense to project monthly, quarterly, and yearly
sales totals for a business.
• Team should view the sales forecast as a plan to work from, not a firm
prediction.
• Before you try to build a forecast, estimate the length of your average sales
cycle and conversion rate.
• There are several different types of forecasts you can build. Test various
methods for accuracy within your business.
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Sales Forecasting
Benefits of Accurate Sales Forecasts
• Sales forecasting is an essential tool for businesses of all sizes. By accurately
predicting future sales, businesses can make more informed decisions about
inventory, staffing, and budgeting.
There are many benefits of having an accurate sales forecast, including:
• Improved decision-making: With an accurate sales forecast, businesses can
make better decisions about inventory levels, staffing needs, and budgeting.
Forecasting can help businesses avoid overspending or stock-outs.
• Reduced costs: An accurate sales forecast can help businesses save money
by avoiding overproduction or underproduction of goods and services.
Forecasting can also help businesses staff appropriately, preventing the need
to pay overtime or hire temporary workers.
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Sales Forecasting
• Increased sales: By accurately predicting future sales, businesses can make
sure they are prepared to meet customer demand. This can help businesses
increase sales and grow their customer base.
• Improved customer satisfaction: A good understanding of future sales helps
businesses meet customer needs and expectations. This can lead to
increased customer satisfaction and loyalty.
• Better planning: An accurate sales forecast allows businesses to plan more
effectively for the future. Businesses can set realistic goals and objectives
based on their sales predictions.
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Sales Forecasting
Factors that can impact your sales forecast
Anything that impacts your company, customers, or industry can impact
forecasting accuracy.
Here’s a look at some of the more common factors that can impact a sales
forecast.
• Internal factors. Things like turnover rate, territory changes, and new
company policies can impact your forecast because they impact seller
performance.
• Economic conditions & and your industry. What’s the economy looking
like right now? Is demand for your products/services rising or falling? Are new
competitors entering the market? If so, what are the chances that those
competitors might take some part of your market share? Are you likely to lose
any major accounts? On the flip side, is there an opportunity to gain new
customers? If you’re marketing to new audiences or you’ve launched a new
product that caters to a new market, you may see some new growth—and
increased revenue.
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Sales Forecasting
• New legislation. New laws or compliance requirements may have an impact
on your sales process. It might mean you’ll need to rethink your approach in
some cases. In others, you might have a solution that helps prospects meet
changing requirements.
• Your products or services. Are you planning on launching new
products/services with the potential to increase sales? Making major
improvements to existing offerings? Or, are certain products/product lines on
the wane? If sales are declining, is it because a competitor offers a better
solution or a similar product at a lower price point? Or is this product/product
line heading toward obsolescence?
• Marketing & advertising. How are your existing strategies performing? Do
they bring in a reliable amount of qualified leads each month/quarter/year? Or
are you trying something new because the old stuff isn’t working? Are you
increasing your advertising budget? Launching any new campaigns?
Marketing on new channels?
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Sales Forecasting
Who uses sales forecasting?
Sales forecast is beneficial for businesses of all types. For example, it can be
used by:
• Sales managers: To set goals and make strategic decisions about sales
forces
• Marketing departments: To better understand how the company can meet
its growth targets and where the greatest opportunities lie
• Finance departments: To better understand how much money is being spent
on marketing and whether it’s effective
• Engineers and product managers: To determine how much inventory needs
to be kept in stock
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What is a time series?

A time series is a set of observations, values, numbers, items, events, facts,

etc. measured at specified regular intervals over a period of time. Time series, a
sequence of historical data points, are then presented in chronological order.
What is Time-Series Analysis?
• Time-Series Analysis helps with forecasting future sales by using historical
sales data recorded by the business to find the underlying trend. Time-Series
Analysis also identifies factors that influence the observations in the time
series, mainly various variations, to determine how sales levels fluctuated at
certain periods of time.
• After the variations are separated from the trend, the time series and the
trend will be extrapolated into the future to predict future sales levels in the
short-term and long-term.
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Time Series Analysis

Methods of time-series analysis in sales forecasting
There are several time-series analysis methods that are used to help identify
future sales from past sales figures:
Trend Extrapolation. Extending the trend of past sales data into the future to
predict future sales.
Fluctuations. Variations from the trend that occurs over time:
• Seasonal variations
• Cyclical variations
• Random variations
Moving Averages. There are a number of moving averages that can be used.
Moving averages smooth out variations in a time series to establish an
underlying trend:
• Three-Point Moving Average
• Four-Point Moving Average
• Trend forecasting using moving averages
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Time Series Analysis

Trend extrapolation
• In sales forecasting, trend extrapolation is the most elementary method of
predicting future sales based on past sales results.
What is a trend?
• A trend is a visible pattern in the underlying movement of data in a time series.
• The obvious trend will show whether sales are increasing, decreasing or
remaining stable over a certain period of time.
• In business management, trends are usually discussed in relation to the
development of a business, when analyzing Final Accounts or when
presenting the results of market research.
What is extrapolation?
• Extrapolation is the statistical process of using past data to predict the future
results.
What is trend extrapolation then?
• Trend extrapolation is a sales forecasting technique that is using past sales
data to predict future sales.
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Time Series Analysis

• Actual sales results in a time series are plotted on the chart to identify the
underlying trend. You will need to establish if that trend actually exists and
whether it is consistent based on all past financial data. If you can
successfully find the trend, your next task is to use it to predict the future.
• That trend line is simply extended into the future to predict future sales. If a
firm’s sale revenues have increased by 10% an average of every year in the
past ten years, and there are not many changes in both internal business
environment and external business environment, then, it might be expected
that this trend will carry on in the foreseeable future.
How to extrapolate a trend?
• Visually, the trend can be identified by a Line of Best Fit using simple linear
regression with independent variable. Then, extrapolating simply means
extending this line to make future prediction. Extrapolation simply takes the
Line of Best Fit one move further in simple linear regression.
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Time Series Analysis

Extrapolation of the current trend into the future for sales

forecasting.
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Time Series Analysis

So, how exactly can we extend the underlying trend into the future?
• Method 1: Freehand sketching. Extrapolation is conducted by the manager
who is plotting the future data and draws the ‘best’ fitting line by eye. This
method, while neither perfect nor scientific, can give a first approximation of
what the future sales results might look like.
• Method 2: Moving averages. Extrapolation is done based on the use of
moving averages which smooth out any variations in the dataset. Two four-
point moving averages are averaged to come up with a centered trend. The
final trend is then established by averaging out regular variations, and then
extrapolated into the future using average seasonal variations, usually for
each quarter.
• Method 3: Regression line. Extrapolation is using the simple regression line
for future predictions outside the range of past X values which were used to
obtain the Line of Best Fit. This method works well when there is a clear
correlation between two sets of numbers and there will be no changes to the
status quo.
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Time Series Analysis

• Method 4: Scenario writing. Extrapolation is using intuition and critical
judgment about future sales to express probably future outcomes. Scenario
writing focuses on future possibilities that the business is facing and how the
business might act on these possible future situations.
Advantages of trend extrapolation
• Trend extrapolation is very useful when predicting the near future. Also, this
sales forecasting technique works well when there is a clear strong relationship
between two sets of numbers such as spending on promotion and sales growth,
or employee training and productivity improvement.
Disadvantages of trend extrapolation
• Trend extrapolation assumes that sales patterns will not change at all in the
future which is neither true nor very likely, especially when discussing long-term
future. Hence, the predicted future sales levels might be completely inaccurate.
Just think about how the Dotcom bubble in 2000, the global financial crisis of
2008 or the COVID-19 pandemic distorted business operations around the world
in the last 15 years.
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Time Series Analysis

Different types of sales fluctuations
Let’s take a look now at different types of fluctuations regarding to sales of
products:
Cyclical fluctuations. These are caused by business cycles in an economy –
mainly economic booms and economic recessions. Sales revenue will
experience recurring fluctuations rising during the growth phase and falling
during the decline phase. An example is when the demand for luxury products
such as high-end cosmetics, expensive cars or holidays abroad increases during
the economic growth in China as the country develops. Cyclical variations are
tied to the business cycle in an economy and can last longer than one year.
Seasonal fluctuations. These are period variations caused by the varying
seasons in a year – mainly months or quarters of the year, or summers and
winters. Sales revenue will fluctuate over a specified period of time. An example
is when a retail business experiences an increase in demand and sales of winter
clothing in cold winter and a decrease in demand and sales of the same winter
clothes in warm summer. Seasonal variations are usually regular and repeated
every year and occur within one year or less.
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Time Series Analysis

Random fluctuations. These are unusual variations caused by a stand-out
event – mainly natural and human-made crises such as public health
epidemics, armed conflicts, natural disasters, corporate image crisis, etc. Sales
revenue will be either unpredictably high or low caused by erratic and irregular
factors that cannot be practically anticipated and prevented. An example is
when there is a sudden increase in demand for air-conditioners during an
extremely hot week during summertime. Random variations are unpredictable
and can happen at any time anywhere in the world.
Most of variations in business management are seasonal variations as they are
usually repeated and happen within one year.
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Time Series Analysis

3. Moving averages
• A moving average is used to ‘smooth out’ the trend by removing any
variations in the dataset produced by cyclical fluctuations, seasonal
fluctuations and random fluctuations. In this way, an underlying trend can be
identified and clear direction of that trend can be established.
Advantages of moving averages
The advantages of moving averages in sales forecasting include:
• More accurate method of identifying a trend and extrapolating that trend than
simply using the arithmetic mean for predicting future sales levels based on
current sales data.
• Useful for identifying seasonal variations for each time period (usually a
quarter) and applying the knowledge to future predictions. Hence, moving
averages aid sales planning in the foreseeable future.
• Helps with finding out various factors that might influence sales in the future.
Once they have been identified, their impact on sales needs to be analyzed.
Then, fairly accurate short-term sales forecasts can be made.
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Time Series Analysis

Disadvantages of moving averages
The disadvantages of moving averages in sales forecasting include:
• More complex to calculate especially for very large sales datasets than free-hand
trend extrapolation.
• Not suitable for forecasting sales in the long-term. The longer the time period, the
less accurate the projections become as they are entirely based on the past
numbers.
• Factors in the internal business environment as well as external business
environment can change unexpectedly any time.
There are a few ways to calculate moving averages. Three-point moving averages
and four-point moving averages are the most common in sales forecasting.
Three-point moving average
• Three-point moving average smooths out the trend, but not completely. Three-point
moving averages are easier and quicker to calculate than four-point moving
averages.
• To calculate three-point moving average, average out three consecutive numbers in
a time series – a number, the previous number and the next number – using
arithmetic mean.
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Time Series Analysis

STEP 1: Start with calculating the arithmetic mean for the first three quarters in
the time series including 2018 January, 2018 February and 2018 March:
• (USD$300 + USD$300 + USD$400) / 3 = USD$333.33
STEP 2: Repeat this calculation for the next two items including 2018
Q3 and 2018 Q4:
• (USD$300 + USD$400 + USD$500) / 3 = USD$400
• (USD$400 + USD$500 + USD$400) / 3 = USD$433.33
STEP 3: Continue this process for the final item in the data set which is 2019
Q1:
• (USD$500 + USD$400 + USD$300) / 3 = USD$400
B. Four-point moving average
• Four-point moving average smooths out the trend more than three-point
moving average. Four-point moving averages are harder and slower to
calculate than three-point moving averages.
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Time Series Analysis

To calculate four-point moving average, average out four consecutive numbers
in a time series using arithmetic mean.
STEP 1: Start with calculating the arithmetic mean for the first four quarters in
the time series including 2018 Q1, 2018 Q2, 2018 Q3 and 2018 Q4:
• (USD$1,000 + USD$1,200 + USD$900 + USD$1,100) / 4 = USD$1,050
STEP 2: Repeat this calculation for the next items including 2018 Q2, 2018
Q3, 2018 Q4 and 2019 Q1 as well as well as 2018 Q3, 2018 Q4, 2019
Q1 and 2019 Q2:
• (USD$1,200 + USD$900 + USD$1,100 + USD$1,500) / 4 = USD$1,175
• (USD$900 + USD$1,100 + USD$1,500 + USD$1,700) / 4 = USD$1,150
Four-point moving averages can be effectively used for working out the
averages when the data vary consistently over a longer period of time. For
example, sales are higher in the second quarter of the year (Q2) but lower in
the third quarter of the year (Q3). Because four-point moving averages fall on
the mid-point (between the 2nd and 3rd number) which does not correspond with
any actual sales figures, hence they need to be further adjusted using Centered
TREND to make possible any comparisons with actual sales figures.
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Sales Organisations – B3
Organisation of Selling Unit
The main objective of any business firm is to sell effectively its goods and
services to the consumer at reasonable prices. So long as the business
undertaking operates on a small-scale; the proprietor can handle himself, or
with the help of a few salesmen, under his direct control and supervision size of
the target market, to be covered to sell large quantities of goods and services
becomes too large to be controlled by the owner of the business firm,
personally. Therefore, these activities arises the need of a sales-organisation.
Generally, an organisation is a structured-process in which individuals interact
with each other for achieving stated-objectives.
Need and Importance
The sales organisation is required for the following purposes:
• To enable the top-management, to devote to more time in policy making for
the growth and expansion of business.
• To divide and fix authority among the sub-ordinates so that they may shirk
work.
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Sales Organisation
• To avoid repetition of duties and functions so that there may not be any
confusion among them.
• To locate responsibility of each and every employee so that they can
complete the whole work in stipulated time; if not then the particular person
must be responsible.
• To establish the sales-routine in the business unit. (vi) To stimulate sales-
effort.
• To enforce proper supervision of sales-force.
• To integrate the individual in the organisation.
Functions of Sales Organisation
A sales organisation performs the following functions:
• Analysis of markets thoroughly, including products and market research.
• Adoption of sound and defensible sales-policy.
• Accurate market or sales forecasting and planning the sales campaign, based
on relevant data or information supplied by the marketing research staff.
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Sales Organisation
• Deciding about prices of the goods and services; terms of sales and pricing
policies to be implemented in the potential and existing markets.
• Labeling, Packaging and packing, for the consumer, who wants a container,
which will satisfy his desire for attractive appearance; keeping qualities, utility,
quantity, and correct price and many other factors in view.
• Branding or naming the product(s) and/or services to differentiate them from
the competitors and to recognize easily by the customer.
• Deciding the channels of distribution for easy accessibility and timely delivery
of the products and services.
• Selection, training and control of salesmen, and fixing their remuneration to
run the business operations efficiently and effectively.
• Allocation of territory, and quota setting for effective Selling and to fix the
responsibility to the concern person.
• Sales-programmes and sales-promotion-activities prepared so that every
sales activity may be completed in a planned manner
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Sales Organisation
• Arranging for advertising and publicity to inform the customer about the new
products and services and their multiple uses.
• Order-preparation and office-recording to know the profitability of the
business and to evaluate the performance of the employees.
• Preparation of customer s record-card to the customer loyalty about the
products.
• Scrutiny and recording of reports to compare the other competitors and to
compare with the past period.
• Study of statistical-records and reports for comparative analyses in terms of
sales, etc.
• Maintenance of salesman’s records to know their efficiency and to develop
them.
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Structure of Sales Organisation

The structure of sales organisation differs from company to company. There
may be a very small and simple one with only a few salesmen. At the other
extreme, there may be quite complex, with many sub-organisations, based
upon divisions, according to territory, product and marketing-functions.
The structure of the sales-organisation, usually depends upon the following
factors:
• Nature and size of the firm.
• Methods of distribution, adopted by the firm.
• Selling-policies of the firm.
• Financial conditions of the firm.
Types of Sales Organization
An organization is designed in a manner where we can identify the work or
activity performed by an individual or group. The roles and responsibilities are
defined, which helps in building relationships to enable people to work
effectively and efficiently. This helps in achieving the goals of the organization.
The following are the four types of sales organizations:
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Structure of Sales Organisation

Functional Type
• Functional type of organization is divided and classified on the basis of the
functions performed. The following illustration shows a functional type
organization.
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Structure of Sales Organisation

Product Type
• This type of division is made according to the products. The organization
divides the departments based on the products.
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Structure of Sales Organisation

Consumer Specialization Type
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Structure of Sales Organisation

Area/ Vertical Type
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Recruitment of Sales Personnel

Recruitment and Selection of Sales Personnel
Right salesmen can help company achieve marketing objectives. Recruitment
and selection are two important decisions in sales force management that
concern with ensuring the right type (right qualities, right qualifications, and
right experience) of sales personnel.
Recruitment: Recruitment means searching for prospective candidates and
inspiring them to apply for the post. Recruitment ends on the last day/date of
receiving applications. Salesmen can be recruited through a number of
sources.
Main sources, widely practiced in India, includes:
• Advertisement
• Other firms/ Competition
• Consultants
• Personal recommendations
• Recommendation of existing staff
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Recruitment of Sales Personnel

• Special recruitment agencies
• Private training institutes
• Colleges and academic institutes, etc.
Types of sources to be used for recruiting the salesmen depend on certain
criteria, like type of products to be sold, types of customers to be served,
paying capacity of company and type of remuneration plans, and other relevant
factors.
Selection: Selection means selecting the fixed number of suitable candidates
from those who applied for the posts. Selection process starts as soon as
recruitment ends. Recruitment considers all applications received in a due date
while selection considers only the required number of most suitable candidates.
There is no ideal selection process that most companies can follow. Normally,
for selecting salesmen, the simple and short selection process is followed.
However, some companies, when more salesmen are to be selected at time,
also follow lengthy and systematic selection process. Selection process
depends on types of salesmen, cost and financial position of company, time
available, company’s objectives, and so forth.
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Recruitment of Sales Personnel

Systematic selection process consists of following steps:
• Receiving applications
• Screening applications
• Preliminary interview
• Written tests
• Final interview
• Medical examination
• Final selection
• Appointment and induction
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Sales Territories Management

What is sales territory management?

Sales territory management is the practice of managing the assignment of sales
representatives to geographic areas, accounts, and customers. It involves
dividing a company’s sales efforts into logical territory segments to ensure sales
coverage and maximize sales performance.
The goal of sales territory management is to maximize the effectiveness of
the sales force by optimizing the sales coverage of the target market.
Territory management involves identifying and defining the boundaries of each
sales territory, assigning sales representatives to those territories, and
monitoring their performance.
The benefits of sales territory management
By leveraging sales territory management, organizations can improve their
overall sales performance and increase their bottom line. Here are a few of the
benefits of sales territory management:
• Accurately cover sales areas by defining them and managing resources
• Improved customer service by enabling sales reps to focus on specific
customers and prospects in their territory
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Sales Territories Management

• Maximize your sales reps’ time by helping them prioritize activities, stay
organized, and easily track progress
• Better forecasting by allowing sales reps to understand their territories better and
identify trends
• More precise customer segmentation and targeting by enabling sales reps to
better understand their customers and focus on the right ones
• Strategically balance workloads according to sales cycle length, travel time,
sales rep skills, resources, and more
Setting up a sales territory
• Setting up a sales territory can be a difficult and time-consuming task. However,
mapping out your sales territories and creating a plan for sales reps is an
important step in optimizing your sales operations. Here are a few steps to take
to create your own structured sales territory that will help your sales team succee
Define your market
• Before setting up a sales territory, it’s important to understand who your target
customers are and what their needs are. This will help you determine where your
sales territory should be located and what type of customers you need to target.
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Sales Territories Management

Research your competitors
Conduct research on your competitors and take note of their sales territories
and strategies. This will give you a better understanding of how to effectively
set up your own sales territory.
Analyze team resources
Evaluate your current team’s skills and availability and decide which areas you
can serve with your current resources. Consider factors such as transportation
costs, availability of personnel, and the size of your sales team.
Define sales territories
Once you have an understanding of your market, competitors, and resources,
you can begin to map out your sales territories. You can use a geographic map
to outline the boundaries of each territory and assign a sales representative to
each one.
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Sales Territories Management

Develop a sales plan
After your sales territories have been set up, you need to develop a sales plan.
An effective sales plan should include details such as goals, tactics, and
strategies. It should also include an action plan that outlines specific tasks that
need to be completed in order to reach your goals.
Develop a sales plan
After your sales territories have been set up, you need to develop a sales plan.
An effective sales plan should include details such as goals, tactics, and
strategies. It should also include an action plan that outlines specific tasks that
need to be completed in order to reach your goals.
Monitor performance
As your sales team works on their individual territories, it’s important to
regularly monitor performance and adjust the strategy as necessary. This
includes tracking customer feedback, sales figures, and other metrics to ensure
the territory is reaching its potential. monday.com can help you monitor territory
sales and help you gather insight into sales rep performance.
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Sales Force Compensation

The sales force of any company needs to be compensated adequately to keep
its morale high and to enable it to contribute to its maximum. The direct salary
and allowances etc. are similar for all kinds of companies. However, the direct
benefits (such as incentives and perquisites) provided by each of them may
differ. The general trend is towards increasing the indirect incentives of the
sales force.
Types of Compensation (Direct)
The direct compensation package of salesperson thus consists of the basic pay
+ allowances covering all travel and entertainment expenses etc. In case, the
salesman has to stay overnight, his boarding and lodging allowances are also
provided for. All the above expenses needless to say, are budgeted and
controlled as per the salesman’s route and cycle of travelling.
The basic salary and other allowances are revised from time to time. They also
increase with promotion of the salesman
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Types of Compensation (Indirect)

• These consists of financial as well as non-financial incentives. The financial
incentives are again in more than one form:
• salary plus commission on sales above a certain amount;
• salary plus a share in profits.
Salary plus commission on sales above a certain amount Herein, the salesman
receives direct salary and a commission in addition to it. Every salesman is
assigned a fixed quota, territory wise/customer-wise to be achieved in a fixed
period of time. The commission is awarded on achievement of the targeted
quota.
This method for compensation with an in-built incentive scheme is adopted by
most consumer non-durable as well as consumer durable companies.
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Sales Force Compensation

Salary plus share in profits: This is not a very popular method It is generally
suggested for a company selling high value items with high profit margins. The
incentive here is based on profits earned.
Non-financial incentives The trend these days is to provide other non-
financial incentives like:
• Training programme
• Awards, recognitions and prizes.
Most companies offer training programmes for their salesmen. On an average a
salesman has to undergo a training course every one or two years. These
programmes enable interaction between salesmen of different territories as well
as provide them with latest developments in the field. These training
programmes are viewed as an indirect benefit by the salesmen. They may be
held in the company premises or preferably at an outdoor locale. They break
the monotony of the salesman’s job as well as make him feel a part of the
company team. A sense of belonging is cultivated which also motivates him.
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Sales Force Motivation

Motivation Of Sales Force
Motivation is generally regarded as the process of getting people to work
towards the achievement of an objective. Ideally it should go beyond the
achievement of company objectives, plans forecasts or targets and help the
company win commitment of sales force to the company.
Salesforce is primarily responsible for achieving the sales targets and as
already mentioned the sales force can not be controlled, administered in the
way factory workers or office staff can be monitored. The sales force is required
to be self starters, highly ambitious, result oriented and go-getters. All the sales
situations cannot be predicted and pre-planned in view of the dynamics of the
market place.
Attracting and retaining a well motivated sales force is a challenging task. The
confidence and motivation of a salesperson get worn out by the inevitable
rejections he suffers from customers as part of his everyday activities.
In some situations such as selling office automation products (Electronic
typewriters, Computers, Xerox machines), consumer durables (television,
refrigerators, scooters etc.), rejections may greatly outnumber successes.
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Sales Force Motivation

Thus, motivation of salespersons poses a major challenge to the management.
The challenge of motivation is magnified by the fact that the salesperson and
supervisor are normally geographically separated, as a result the salesperson
may feel isolated and even neglected. He is prone to frustration of success and
failure coupled with extra working hours.
He requires extensive travelling, many days of separation from family and with
sense of risk involved in travelling. Above all he has to live in the environment
of competitiveness with his own colleagues to meet his targets. In market
situation characterised by keen competition he is constantly exposed to the
offerings of the competing manufacturers – in terms of their sales
compensation packages, working conditions etc.
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Sales Force Motivation

Motivation And Needs
Behaviour research studies have revealed that motivation can be created if
needs can be studied, evaluated and predicted and fulfilled. We know that
various types of needs arise out of ambitions / dreams and all needs create
tensions leading to that extra bit of effort and activity which help fulfill these
needs and achieve the goals.
According to A.H. Maslow needs can be classified into five categories:
• Physiological Needs Food, clothing, shelter are primary needs which are
ordinarily satisfied.
• Safety Needs Protection from threat, danger and deprivation etc.
• Social Needs Need to feel that everyone belongs to a relationship, to feel as
being accepted as part of the society.
• Ego Needs Needs which satisfy the enhancing of self-image, self-esteem,
self-respect and achievement. Salespersons in general has high level of ego
needs.
• Self-Actualisation Needs These are the desires of self-development, self-
fulfillment and self-growth
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Sales Force Motivation

The simple motivational tools of early years such as only financial benefits
prove to be a poor method of motivation beyond physiological and safety needs
satisfaction on account of the unique aspects of a salesperson’s job.
• The non-financial incentives, thus, become an important component of the
motivation mix of a company.
• Individual meetings with supervisor to discuss career, job problem etc.
• Regular accompaniment in the field by the sales manager
• Merit promotion system rather than “dead man’s shoes”.
• Participation in setting sales targets.
• Sales force meetings/convention.
• Sales contest/competition.
• Bigger car for higher sales turnover.
• Fear of dismissal or unemployment.
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Sales Force Controls

What is sales control?
Sales control refers to the operations that managers undergo to keep track of and
make predictions about the sales and performance of their company. Managers
exercise sales control when they analyze past sales processes, revise policies and
strategies intended to increase sales, create and optimize sales and budget plans
and set up sales information systems.
A sales information system provides employees with important information regarding
the past, present and future of a company's sales, which the manager can use to
create a sales control system, allowing them to more readily identify, amend or
maintain sales operations within the organization.
Methods for controlling sales
Here are some of the primary methods managers use to control sales within a
company:
Assign individual sales targets
One common method of sales control is to assign individual sales quotas to all
members of the sales department. This allows for managers to take circumstances,
such as experience and seniority, into account when deciding on a sales target for
each employee.
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Sales Controls
Meet with the sales department regularly
• Another common method of sales control is to meet with employees on a regular
basis to discuss their questions and concerns with the company and their positions.
This allows for managers to get an in-depth, first-person account of how the sales
department feels in terms of corporate support, industry standards and workplace
dynamics.
Perform observations consistently
• Observations can also provide management with helpful insight as to how effective
their sales control system is or not. Members of management can dedicate specific
times or days to observing employees as they speak to clients and interact with one
another. There are plenty of conclusions management can come to by observing their
sales representatives on the job.
Assign sales territories
• Another way to promote sales control is to assign sales territories to employees. A
sales territory is a designated location where a salesperson can find and make deals
with clients, but others with different territories cannot penetrate that specific
location's market. By assigning different sales territories, managers can decrease
inter-colleague competition and target new areas where they may not have as much
competition, opening up brand new markets for the company to generate revenue in.
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Sales Control
Sales control tips
Here are some tips you can follow to help integrate sales control into your
own work environment:
• Keep in contact with employees and executives alike to ensure that everyone
taking part in the sales process feels satisfied and has the motivation to excel
in their positions.
• Give employees space and freedom to work without constantly feeling like
management is watching them.
• Incorporate incentives into your sales control system to encourage employees
to exceed their targets and receive rewards for their hard work.
• Be clear when defining performance standards so that everyone understands
exactly what's expected of them in their work role.
• Foster an environment where employees feel comfortable approaching
management with their questions and concerns to keep the company operating
as smoothly as possible.