SALES AND

DISTRIBUTION
MANAGEMENT

www.bschool.cms.ac.in
 Module 1
Introduction to Sales Management, Budgeting and
Planning

Understand the role and importance of Sales Management, Sales

Management Process, Selling Process, Roles and responsibilities of a
Sales Manager, Importance of Sales Planning, Sales Budgeting,
Territory Planning and management, Various types of Quotas, and
Sales forecasting.
Learning Outcomes: Identify the key result areas of a Sales and
distribution manager

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 3

Understand the role and importance of Sales

Management, Sales Management Process, Selling
Process, Roles and responsibilities of a Sales
Manager, Importance of Sales Planning, Sales
Budgeting, Territory Planning and management,
Various types of Quotas, and Sales forecasting.
Learning Outcomes: Identify the key result
areas of a Sales and distribution manager

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 4

What is Sales Management?

• One definition: “The management of the personal
selling part of a company’s marketing function.”
• Another definition: “The process of planning,
directing, and controlling of personal selling, including
recruiting, selecting, equipping, assigning, supervising,
paying, and motivating the personal sales force.

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 5

Nature and role of Sales Management

Specific duties and responsibilities of a

sales manager:
• The determination of sales force objective and
goals
• Sales force organization, size, territory, and quota
finalization
• Sales forecasting and budgeting
• Sales force selection, recruitment, and training

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Nature and role of Sales Management

• Motivating and leading the sales force
• Designing compensation plan and control systems
• Designing career growth plans and building relationship
strategies with key customers
• Integration of technology with sales function
• Augment the sales force by augmenting the sales-
closing process

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 Nature of Sales
Management
• Its integration with marketing
management
Head-
Marketing

Manager- Manager – Manager – Manager – Manager –

Promotion Market Sales Market Customer
Research Logistics Service

• Relationship Selling

Transactional Value – added Collaborative /

Relationship / Relationship / Partnering
Selling Selling Relationship /
Selling
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 8

Understand the role and importance of

Sales Management
• The only function / department in a company that
generates revenue / income
• The financial results of a firm depend on the
performance of the sales department / management
• Many salespeople are among the best paid people in
business
• It is one of the fastest and surest routes to the top
management

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 9

Understand the role and importance of

Sales Management
Value creation for customers
• Value = Benefits – Cost
• Give more benefits, or
• Reduce cost
Value addition to the organisation
• Importance to profit
• Attention to terms of payment.
• Give credit to credit-worthy customers only.

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 10

Sales Management Process

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 11

Activity (18/11)

Some products that are being sold have

some free alternatives that people can
get to. So, how do you sell something
that people could get for free?
https://mariopeshev.com/sales-sample-
case-studies/

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 12

Bottled water

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Selling Process

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 The Sales
Process
As a part of selling activities, if salespeople follow
the steps or phases shown below, their chances of
success are far better.

Prospecting & Preapproach / Presentation &

Qualifying Approach
Precall planning Demonstration

Follow-up & Trial close / Overcoming

Service Closing the sale Objections

• The sequence of above steps may change to meet

the sales situation in hand.
• Some of the above steps may not be applicable for
selling to the trade
• We now discuss application of above steps to
industrial selling bschool.cms.ac.in
Prospecting
• It is identifying or finding prospects i.e. prospective or
potential customers.
• Methods of prospecting or sales lead generation are:
(1) referrals from existing customers, (2) company sources
(website, ads., tradeshow, teleprospecting), (3) external
sources (suppliers, intermediaries, trade associations), (4)
salespersons’ networking, (5) industrial directories, (6) cold
canvassing, (7) standard industrial classification (SIC)
system.

Qualifying
• Companies qualify sales leads by contacting them by mail
or phone to find their interests (or needs) and financial
capacity.
• Leads are categorized as: Hot, Warm, and Cool
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 Preappr
oach
• Information gathering about the
prospect.
Sources of information: the Internet,
industrial directories, government
publications, intermediaries, etc.
• Precall planning
• Setting call objectives
• Tentative planning of sales strategy: which
products, features and benefits may meet the
customer needs

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 Approa
ch
• Make an appointment to meet the prospect
• Make favourable first impression
• Select an approach technique:
• Introductory
• Customer benefit
• Product
• Question
• Praise
• The approach takes a few minutes of a call, but
it can make or break a sale

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 Presentation and
Demonstration

There are four components:

• Understanding the buyer’s needs
• Knowing sales presentation methods / strategies
• Developing an effective presentation
• Using demonstration as a tool for selling
We will examine each of the above points

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 Understanding the
buyer’s needs
• Firms and consumers buy products /
services to satisfy needs
• To understand buyer’s needs, ask questions
and listen
• In business situations, problem
identification and impact questions are
important
E.G.
• Have you experienced any problems on
quality and delivery from the existing
supplies?
• What impact the quality and delivery
problems will have on your costs andbschool.cms.ac.in
 Knowing Sales Presentation
Methods/Strategies

Firms have developed different methods / styles / strategies

of sales presentation
• Stimulus response method / canned approach.
• It is a memorised sales talk or a prepared sales
presentation.
• The sales person talks without knowing the prospect’s
needs. E.G. Used by tele-marketing people
• Formula method / formulated approach.
• It is also based on stimulus response thinking that all
prospects are similar.
• The salesperson uses a standard formula – AIDA
(attention, interest, desire, and action).
• It is used if time is short and prospects are similar.
• Shortcomings are: prospects’ needs are not uncovered
and uses same standard formula for different
prospects. bschool.cms.ac.in
 Sales Presentation Methods
(Continued)

• Need – satisfaction method

• Interactive sales presentation
• First find prospect’s needs, by asking
questions and listening
• Use FAB approach: Features, Advantages,
Benefits
• Effective method, as it focuses on customers
• Consultative selling method / Problem-
solving approach
• Salespeople use cross-functional expertise
• Firms adopt team selling approach
• It is used by software / consulting firms

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 Developing an Effective
Presentation
Some of the guidelines are:
• Plan the sales call
• Adopt presentation to the situation and
person
• Communicate the benefits of the purchase
• Present relevant and limited information at
a time
• Use the prospect’s language
• Make the presentation convincing – give
evidence
• Use technology like multi-media
presentation bschool.cms.ac.in
 Using
Demonstration
• Sales presentation can be improved by
demonstration
• Demonstration is one of the important
selling tools EGs: Test drive of cars;
demonstration of industrial products in
use
• Benefits of using demonstration for
selling are:
• Buyers’ objections are cleared
• Improves the buyer’s purchasing interest
• Helps to find specific benefits of the
prospect
• The prospect can experience the benefit bschool.cms.ac.in
 Overcoming Sales Objections /
Resistances
• Objections take place during presentations /
when the order is asked
• Two types of sales objections:
• Psychological / hidden
• Logical (real or practical)
• Methods for handling and overcoming
objections:
(i) For Psychological objections: ask
questions.
(ii) For logical objections: (a) ask questions,
(b) turn an objection into a benefit, (c)
deny objections tactfully, (d) third-party
certificate, (e) compensation.
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 Trial close and Closing
the sale
• Trial close checks the attitude or opinion of
the prospect, before closing the sale (or
asking for the order)
• If the response to trial close question is
favourable, then the salesperson should
close the sale
• Some of the techniques used for closing
the sale are: (a) alternative-choice, (b)
minor points, (c) assumptive, (d) summary-
of-benefits, (e) T-account, (f) special-offer,
(g) probability, and (h) negotiation

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 Follow-up and
Service

• Necessary for customer satisfaction

• Successful salespeople follow-up in
different ways: For example,
• Check order details
• Follow through delivery schedule
• Visit when the product is delivered
• Build long-term relationship
• Arrange warranty service

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 Negotiat
ion
• Salespeople, particularly in business to business
selling, need negotiating skills
• When to negotiate?
(a) When the buyer puts certain conditions for
buying to the seller, (b) When agreement between
the buyer and the seller is needed on several
factors, (c) When the product is customised, (d)
When the final price is to be decided
• How to prepare for negotiation?
(a) planning, (b) building relationship, (c) purpose
• Styles of negotiation
(a) I win, you lose, (b) Both of us win (or win-win
style), (c) You win, I lose, and (d) Both of us lose

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Roles/Responsibilities/Skills of a Modern
Sales Manager
• A member of the strategic management team
• A member of the corporate team to achieve
objectives
• A team leader, working with salespeople
• Managing multiple sales / marketing channels
• Using latest technologies (like CRM) to build
superior buyer-seller relationships
• Continually updating information on changes in
marketing environment

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Skills of a Successful Sales Manager
• People skills include abilities to motivate, lead,
communicate, coordinate, team-oriented relationship,
and mentoring
• Managing skills consist of planning, organizing,
controlling and decision making
• Technical skills include training, selling, negotiating,
problem-solving, and use of computers

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Importance of Sales Planning

• Better implementation of corporate plans
• Reduce uncertainty and risk
• Focus on realistic objectives
• Ensure healthy interpersonal relationships
• Provide a sense of direction
• Improve coordination
• Facilitate control

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 Key
Learnings

• Sales management is defined as the management

of the personal selling part of a company’s
marketing function
• Selling includes varying sales jobs like delivery
salesperson, order taker, sales support person,
and order getter
• Sales is the only function or department in an
organization that generates revenue / income
• Changing role a sales force is value creation for
customers and value addition to the organisation.
• Skills of a successful sales manager include
managing, technical and people
• Main components of sales planning are objectives,
strategies, and tactics (or action plan)
• Either sales management or distribution
management can not exist, operate or perform bschool.cms.ac.in
 Key
Learnings

• For understanding psychology in selling, study

consumer or buyer behaviour, buying process
and situations
• Salespeople are given knowledge of sales and
relevant marketing policies in order to increase
their self-confidence and sales, and meet
customers’ expectations
• Typical steps in the sales process include
prospecting and qualifying, preapproach,
approach, presentation and demonstration,
overcoming objections, trial close / closing the
sale, follow-up and service
• Salespeople should know when to negotiate, how
to prepare for negotiation and which style ofbschool.cms.ac.in
negotiation to use