SALES AND DISTRIBUTION

MANAGEMENT
RAVIMOHAN
 OBJECTIVES OF THE MODULE
• The Sales Process, Sales Management, Nature and
Importance of Sales Management, Integration with
Marketing Management, Field Selling, Headquarter
Marketing Team, Relationship Selling, Importance of
Personal Selling and Sales Management, Role and
Skill of Modern Sales Managers, The Skills of a Sales
Manager, Levels in Sales Management-Organisational
Hierarchy, Sales Objectives, Strategies and Tactics,
Sales Objectives, Sales Strategies and Tactics, Sales
Strategies, Emerging Trends in Sales Management,
Linking Sales and Distribution Management,
Distribution Channels, Maximising Customer Service,
Sales Operation Planning.
THE SALES PROCESS
Prospecting and Qualifying

Pre Approach (Precall Planning)

Approach

Presentation and Demonstration

Overcoming Objections

Trial Close/Closing the Sale

Follow-up and Service

 SALES MANAGEMENT
“Sales management means the planning, direction and control of
personal selling, including recruiting, selecting, equipping,
assigning, routing, supervising, paying and motivating as these
tasks apply to the personal sales force”
- American Marketing Association.
NATURE AND IMPORTANCE OF SALES MANAGEMENT
The nature and characteristics of sales management can be
explained by
1. Its integration with marketing management.
2. Relationship selling, and
3. Varying Sales Responsibilities.
INTEGRATION WITH MARKETING MANAGEMENT
As Sales Management is a part of marketing management, sales
planning should be integrated with Marketing Planning. A
company’s marketing team consists of two basic groups.
 INTEGRATION WITH MARKETING MANAGEMENT
CONTD
1. Field Selling (or Personal selling) team, and
2. Headquarter Marketing Team.
FIELD SELLING
Field Selling Teams (or Field Salesforce) are in their territories (or
branches and regions) contacting existing and prospective (or
new) customers.
HEADQUARTER MARKETING TEAM
The Headquarter marketing team performs support and service
functions or activities to assist or help field salespeople in their
jobs. These headquarter based service and support functions are:
(a) Promotion: Consists of Advertising, Sales Promotion, Public
Relations, Publicity, and Direct Marketing.
(b) Marketing Research: Collecting and Interpreting information
on customers, competitors ,products, markets and so on.
 HEADQUARTER MARKETING TEAM CONTD
(c) Marketing Logistics: Physical Distribution of finished goods
including Warehousing, Transportation and Order Processing.
(d) Customer Service: Pre-sales and Post-sales service as well
as delivery service to existing and prospective customers.
(e) Coordination: Sometimes there is a need to coordinate
between customers, company’s salespeople and production or
operations , by employing inside salespeople.
RELATIONSHIP SELLING
Buyers and Salespeople, who do business together have same
type of business (or working) relationships. Their relationships
have a range or spectrum as shown below.
1. Transactional Relationship/ Selling.
2. Value-Added Relationship/ Selling.
3. Collaborative/Partnering Relationship/ Selling.
 RELATIONSHIP SELLING CONTD
• Every relationship is an exchange, which is the process of obtaining
the desired product or service from someone by offering something in
return. In practice, the attitude and culture of the organisation are
reflected in the attitude and behaviour of individual buyers and
salespersons.
• Relationship Marketing is basically the creation of customer loyalty. It
means important or major customers need continuous attention
through partnering or collaborative relationships. Relationship selling
is the tactical (or action oriented) arm of relationship marketing.
• For instance, the company’s best salespeople are assigned to sell
and service ‘A’ class or major customers. Both selling and buying
organisations work collaboratively to lower the total costs or increase
value, in order to achieve mutual benefits.
• However, all customers do not have high sales and profit potential.
Customers who have low-priced and low-profit products and services
( such as seeing a movie at a theatre and eating in a restaurant) the
focus is on single transaction with the customer. This is called
 RELATIONSHIP SELLING CONTD
transaction oriented selling where after the product or service is
sold, the customer is not contacted again and hence the
relationship is not extended.

• In the case of value-added exchange, the focus is on the

salesperson understanding the current and future needs of the
customer correctly and meeting those needs better than the
competitors. After the purchase is made, the salesperson
contacts the customer to find out if the customer is satisfied
and has any future needs. Such customers have medium sales
and profit potential. For e.g, Maruti Udyog’s sales and service
centers contact each customer to find out the customer’s
satisfaction with the car’s purchase or maintenance service.
The role of salespeople is very important in the company’s
relationship marketing programme.
IMPORTANCE OF PERSONAL SELLING AND SALES
MANAGEMENT
• Personal selling or sales is one of the most exciting, financially
rewarding and challenging careers. There are more positions
available in sales than any other professional occupations.
Salespeople are among the best paid people in the business. A
sales career is one of the fastest and surest route to the top
management. Studies on top-level managers has shown that
many of these senior executives began their careers either in
sales or in marketing positions.
• Sales department is the only function or department in an
organisation that generates revenue (or money). All other
departments spend the money. Hence the financial results of an
organisation depend upon the performance of sales
management. Net profit or the bottom line of the company is
considered as good, if the sales revenue or the top line is good.
It shows how important the sales department and the sales-
people are to the organisation.
 ROLE AND SKILL OF MODERN SALES
MANAGERS
• The modern sales manager is a team leader rather than a boss to
the salespeople. The sales manager directs and advises salespeople
by working with them and giving them necessary authority to take
decisions. Some of the important changes to the roles of modern
sales manager are as follows.
• Playing a strategic role in the company, by giving key inputs for
developing long-term company marketing and sales plans, such as
sales forecasting, salesforce management, evolving sales and
marketing strategies, implementing and controlling sales budget.
• Working as a member of the corporate team to achieve objectives
such as customer satisfaction, sales growth and market value.
• Working as a team leader with the salespeople to achieve the
objectives and goals of sales and profits.
• Managing multiple sales channels such as company’s salesforce,
electronic ( or online) marketing and telemarketing.
ROLE AND SKILL OF MODERN SALES MANAGERS
• Using latest technologies to build superior buyer-seller
relationships.
• Continually updating information and understanding the
changes in marketing environment like customers’ businesses,
competitors’ strategies and techniques, government regulations
and technological changes.
THE SKILLS OF A SALES MANAGER
The skills that are critical for a sales manager are:
• People skills : The people skills include the sales manager’s
ability to motivate, lead, communicate, and coordinate
effectively with the people around him/her. The ability to
develop team-oriented relationships is important. With respect
to salespeople the sales manager should understand their
individual needs and skills, carry out coaching or mentoring to
improve performance.
 THE SKILLS OF A SALES MANAGER
• Managing skills :For managing the salesforce,
the salesforce should have administrative or
managing skills like planning, organising,
controlling, and decision making. These skills
can be learnt by attending management
development programmes.
• Technical skills: These are specific tasks or
functions such as training, selling, negotiating
as well as the ability to use computers (or
information technology skills) and problem-
solving abilities in the specific industry
discipline.
 LEVELS IN SALES MANAGEMENT-
ORGANISATIONAL HIERARCHY

CEO/
President Strategic/Top Level
Sales Leaders /
Managers
V.P.Sales/
V.P. Marketing

National Sales Manager

Regional/Zonal/Divisional Tactical /Middle-Level

Sales Manager Sales Managers

Branch/Area/District Sales Manager Operational/First-Level

Sales Managers
Sales Trainees/Sales Person/Sales Representatives
SALES OBJECTIVES,STRATEGIES & TACTICS
• Sales managers are guided by the strategic planning at
company level and at the marketing level, when they prepare a
sales plan consisting of sales objectives, sales strategies and
tactics(or action plans).
SALES OBJECTIVES
• Objectives are statement of intents and when they are
quantified to specific and measurable targets with respect to
time periods, they are called goals.
• The sales objectives and goals are derived from the company’s
marketing objectives and goals which depend on the
company’s (or corporate) objectives and goals.
SALES STRATEGIES AND TACTICS
Evolve
Decide Develop
Tactics
Objectives Strategies
(or Action Plans)
 SALES STRATEGIES
• Strategies include ways of achieving the objectives, and tactics
(or action plans) are the activities or the actions that should be
carried out in order to implement strategy. The sales strategies
are mostly related to salesforce strategies. We shall take an
example to show the relationship between sales objectives,
strategies and tactics.
• Crompton Greaves Ltd, wants to achieve a sales objective of
increase in sales volume for its product-electric motors, by 15%
and reduce selling expenses by 10% in the year 2011-2012.The
marketing strategies are
(a) enter export markets,
(b) penetrate existing domestic markets,
(c) utilise existing Salesforce optimally, and
(d) use effective and efficient channels.
EMERGING TRENDS IN SALES MANAGEMENT
• Global perspective.

• Revolution in Technology.

• Customer Relationship Management(CRM).

• Salesforce Diversity.

• Team selling Approach.

• Managing Multi-channels.

• Ethical and Social issues.

• Sales professionalism.
 LINKING SALES AND DISTRIBUTION
MANAGEMENT
• Distribution management serves the primary function of
ensuring that the product or service is made available to the
consumer within arm’s length of his desire. It takes care of the
availability (physical distribution) and visibility. It provides ‘time’,
‘place’ and ‘possession’ utility to the consumer. It is the sales
managers who decide the organisation which is responsible for
the distribution effort. Normally, it is the combination of the
company’s own salesforce and a set of marketing channels.
• Distribution is an integral part of sales management. It is the
heartbeat of sales management. Either sales management or
distribution management cannot exist, operate or perform
without revenue, growth or market shares, it is the distribution
part which executes these plans, of course, under the guidance
of sales managers. Planning and execution is team effort
between sales managers and distribution channels.
 LINKING SALES AND DISTRIBUTION
MANAGEMENT
• As we said earlier, distribution management has the
responsibility of physical movement and storage also. The only
sensible and cost effective alternative of getting all these tasks
accomplished is through a sound distribution management with
the help of the marketing channels.
DISTRIBUTION CHANNELS
• The distribution channels to be managed by sales management
could be a combination of :
1. Own salesforce –recruited and trained to manage key
account and the distribution channels.
2. C&FAs or depots – to break bulk. Depots are the company’s
own warehouses. C&FA s are carrying and forwarding agents
who are primarily transporters with own or hired warehouses.
They break bulk and send company goods to its distributors,
dealers or stockists based on despatch orders given by the
 DISTRIBUTION CHANNELS CONTD
salespeople. C&FAs work on a commission.
• Distributors, dealers, agents , stockists- the backbone of the
distribution system. They are the people who buy goods from
the company and sell it to the customers like wholesalers,
retailers and institutions. They may be exclusive to the
company like contracted distributors or also work for other
companies like dealers and stockists. All these channel
partners work on a mark-up.
• Transporters, warehouse operator- these channel members
ensure physical movement and safekeeping of goods. These
channel members are usually managed by the logistics function
and not sales management. They could be either on contract or
hired as necessary. Today a large number of Third party
Logistics (TPL) providers are available who provide an end to
end solution to all your logistics needs.
• Independent wholesalers in the market-They are already
 DISTRIBUTION CHANNELS CONTD
operating in the markets and selling a variety of complementary
goods - like groceries, plumbing equipment, electrical accessories,
spare-parts or food items. They are not bound on contract with any
company. They operate on low volumes but high margins.
• Independent retailers in the market- More relevant for consumer
goods and pharmaceutical products. They could be the corner
store or modern retail format. Retailers are the most pampered lot
in the entire distribution network as they are closest to the end
user or customer.
• Distribution management can be done by the company itself. But
most companies today outsource the distribution effort as it is
possible to find competent distribution models to perform the
functions.
• Distribution channels can be in-house or outsourced. Experience
has taught sales management that it is more cost and effort
effective to outsource the distribution function.
 DISTRIBUTION CHANNELS CONTD
• Example of own distribution channels include Eureka Forbes
and Bata.
• There are hundreds of examples of outsourced distribution like
Maruti, LG and Nestle.
MAXIMISING CUSTOMER SERVICE
Sales management and distribution function together take certain
actions to ensure that the customer service objectives of the
company are fully met. Some of the action points are mentioned
here.
• Demand Management- a critical step in getting sales volumes
and earning revenues. Both sales managers and their channel
members help this activity through forecasts, obtaining
business and securing orders to meet set volume targets.
• Supply Management- This is the major responsibility of the
distribution channel working under the guidance of sales
management.
 MAXIMISING CUSTOMER SERVICE
• The company depot or the carrying and forwarding agent or
contract with the company receives orders from the field force
and processes them for despatch to the primary customers of
the company-distributors or institutions. They also collect the
value of the sales made. This is the primary sales.
• The distributor/dealer/stockist /agent receives orders from his
customers (traders or institutions) either directly or through the
salespeople and processes them for despatch. They collect the
value of the sales made. This is the secondary sales.
• Both the C&FA and the distributor provide storage space for
safekeeping of the goods till they are sold out.
• The C&FA and the distributor may use own transport vehicles
or hired transport to move the goods from their premises to that
of customers.
• The wholesaler or the retailer is the most important channel
partner for mass based consumer products. He is the one who
 MAXIMISING CUSTOMER SERVICE CONTD
• is directly in touch with the end-users. He makes sure that he
buys the products, stocks them, displays and sells them to the
end users.
SALES OPERATION PLANNING
• The planning of the sales operations is always done jointly with
by the sales managers and the channel members. Some of the
points in the operations planning exercise are highlighted here:
• List of markets to be covered and the schedule – the
company would like to be represented in full strength in all the
potential markets and outlets.
• Market share objectives to be achieved and how- built into
the secondary sales targets agreed with the channel partners.
• Tracking Competition in order to always do better than them.
• Designing coverage beat plans/call plans using a milk-run
concept- How many outlets are covered in a day, frequency of
 SALES OPERATION PLANNING CONTD
• of calls on an outlet and when a call is to be made. The milk-run
concept makes sure that there is no crisscrossing in the
coverage- the calls are made in a sequence.
• Ensuring highest call productivity- every call has to be made
to deliver results.
• Market working method and tools – whether to cover the
markets with the ready stocks or book orders and deliver stocks
later, how to run the call, how much credit to extend and to
whom.
• Sales promotion efforts- could include the power of the sales
call or the consumer and trade promotions occasionally run by
the company.
• New product/pack launches- each such small event has
important milestones in volume sales, placement of the
products and merchandising to be achieved. These are agreed
with the channel partners and then it is their responsibility to
 SALES OPERATION PLANNING CONTD
achieve the same.

• Shelf space maximisation and merchandising- most

relevant to consumer products. The intention is to occupy the
best shelves fully, giving little chances for competition to be
present. This also means utilisation of costly point-of-purchase
(POP) material effectively in the market place. The shelf space
to be achieved in each outlet should be atleast be in proportion
to the market share enjoyed by the company in the particular
market.

• Reports and Records- include those required by the company

and those required for statutory purposes (government rules).
All reports and records have to be timely and accurate.
 SUMMING UP
• The Sales Process, Sales Management, Nature and
Importance of Sales Management, Integration with
Marketing Management, Field Selling, Headquarter
Marketing Team, Relationship Selling, Importance of
Personal Selling and Sales Management, Role and
Skill of Modern Sales Managers, The Skills of a Sales
Manager, Levels in Sales Management-Organisational
Hierarchy, Sales Objectives, Strategies and Tactics,
Sales Objectives, Sales Strategies and Tactics, Sales
Strategies, Emerging Trends in Sales Management,
Linking Sales and Distribution Management,
Distribution Channels, Maximising Customer Service,
Sales Operation Planning.
QUESTIONS??
THANK YOU