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Strategic Sales Planning for Business Success

Sales planning is crucial for providing direction, improving morale, and enhancing decision-making quality in a dynamic business environment. Learn how sales managers benefit from planning processes like setting goals, forecasting sales, and implementing strategies.

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Strategic Sales Planning for Business Success

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  1. CHAPTER - 3 SALES PLANNING AND BUDGETING

  2. WHY SHOULD SALES MANAGERS PLAN? Without a plan to provide directions, decision making is aimless and disconnected. Sales managers must make their decisions within an environment where change is continuous. Planning helps minimize environmental shocks.

  3. WHY SHOULD SALES MANAGERS PLAN? BENEFITS OF PLANNING Improve morale Provide directions and focus Improve cooperation and coordination Develop individual and collective standards Increases the sales organization’s flexibility Improve the quality of decision making

  4. SALES MANAGERS AS PLANNERS AND ADMINISTRATORS Define goals and objectives Set policies Establish procedures Devise strategies Direct tactics Design controls

  5. THE PLANNING PROCESS 1. ANALYZING THE SITUATION • Market characteristics • Competition • Sales, costs, and profit data for current and recent years • Bundle of benefits offered as perceived by potential customers • Promotional mix • Distribution systems

  6. THE PLANNING PROCESS 2. SETTING GOALS AND OBJECTIVES • Overall and individual goals and objective should be understood by all units and personnel • Goals and objectives must be spelled out explicitly and in order of priority • Goals and objectives must be consistent and not in conflict with each other

  7. THE PLANNING PROCESS 3. DETERMINING MARKET POTENTIAL To assess market potential and sales potential - • Studying the present customers and their buying characteristics • Estimating the increased usage rates that might occur if current product is modified for current customers or repositioned for potential new customers • Estimating the market potential for new products being developed

  8. THE PLANNING PROCESS 4. FORECASTING SALES A sales forecast predicts future sales for a prescribed period as an integral part of a marketing plan.

  9. THE PLANNING PROCESS 5. SELECTING STRATEGIES Strategic planning is the process of setting the organization’s overall objectives, allocating total resources, and outlining broad courses of action.

  10. THE PLANNING PROCESS Growth strategies Existing products New products Existing markets Market penetration Product development New markets Market development Diversification

  11. THE PLANNING PROCESS The business portfolio approach Strategic business units (SBUs) are logical divisions of major businesses within multiproduct companies. • Distinct mission • Separate management • Unique customer segments • Own competitors • Independent planning

  12. THE PLANNING PROCESS Star Question mark High Market growth rate Cash cow Dog Low High Low Relative market share The BCG growth-share matrix

  13. THE PLANNING PROCESS Stakeholders Government Special interest groups General public Company employees Stockholders Financial community Suppliers Independent print and broadcast media

  14. THE PLANNING PROCESS 6. DEVELOPING DETAILED ACTIVITIES Tactical action plans are the subplans that underlie and accomplish the overall strategic plan. Tactical action plans identify what needs to be done, who is responsible, what resources are needed and what benefits are expected

  15. THE PLANNING PROCESS 7. ALLOCATING NECESSARY RESOURCES Money People Materials Equipments Time

  16. THE PLANNING PROCESS 8. IMPLEMENTING THE PLAN It is essential that the sales manager ensure that the schedule is closely monitored. Changes or modifications may be necessary. Sales managers who remain alert to the unexpected will be able to adjust their plans and their implementation in a timely fashion

  17. THE PLANNING PROCESS 9. CONTROLLING THE PLAN • Performance standards and measures industry averages past performance managerial expectations customer satisfaction and societal satisfaction • Corrective actions

  18. APPROACHES TO PLANNING • DIALECTIC PLANNING considers the validity or probability of the underlying assumptions in a forecast. • CONTINGENCY PLANNING is a backup to the one adopted and will be executed only if events occur that are beyond the control of the major plan. • SALES AUDIT is a systematic and objective evaluation of a sales organization and its selling environment, goals, objectives, policies, strategies, tactics, procedures and related activities.

  19. SALES BUDGET Common line items in each sales budget - • Salaries • Direct selling expenses • Commissions and bonuses • Benefit packages • Office expenses • Promotional materials • Advertising

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