Chapter 16

1. Chapter 16 Managing within Your Company

2. Building Internal Partnerships Internal partnerships- partnering relationships between a salesperson and another member of the same company The Importance Of Internal Partnerships • Involves working with other employees in the firm • The ability to work with groups inside the company can directly affect the rep’s pocketbook The Role Of Sales In Learning Organizations • One of the most important functions of the sales force is carrying the customer’s voice across a learning organization • Salespeople must adapt to satisfy the needs and desires of those who influence sales performance

3. Selling Internally Selling Internally (Exhibit 16.1) • Accept responsibility • Appeal to higher objective • Use SPIN to understand needs • Salespeople cannot order a colleague to do something; illustrate benefits to the colleague & increase time urgency • Keep issues professional • Be prepared to negotiate

4. Company Areas Important To Salespeople Manufacturing • Goal: Producing products at the lowest possible cost Administration • Goal: Efficient processes - Administrative departments include order entry, billing, credit, and employee compensation Shipping Goal: Costs & delivery

5. Company Areas Importantto Salespeople Customer Service • Important for faster and more direct information flow to the salespeople Marketing • Should coordinate closely with sales Biggest problem is usually lack of communication

6. Company Areas Importantto Salespeople Sales • Salespeople are often divided in which accounts they are responsible for

7. Partners In The Sales Organization Sales Management The Sale Executive • Manager is at the top of the sales force hierarchy • The executive determine the size and organization of the sales force, develop annual and long-range plans, and monitor and control sales efforts Size and Organization of the Sales Force • The executive determines how many salespeople are needed to achieve the company’s sales and customer satisfaction targets • Must determine what types of salespeople are needed

8. Forecasting Bottom-up forecasting- adding each salesperson’s own forecast into a forecast for total company sales • This technique allows the information to come from the people closest to the market: the salespeople • Salespeople tend to be optimistic and may overestimate sales • Salespeople are important to an executive attempting to forecast international sales

9. Expense Budgets • Managers sometimes use expense budgets to control costs • May be expressed in dollars or as a percentage of sales volume • Bonuses may be rewarded for cutting budget • Ultimately it is the salesperson’s responsibility to mange the territorial budget • Resource allocation is important

10. Control and Quota Setting • Quotas are a useful technique for controlling the sales force Quota- represents a quantitative minimum level of acceptable performance for a specific time period Sales quota- minimum number of sales in units Revenue quota- minimum amount of sales revenue necessary for acceptable performance Profit quotas or Gross margin quotas- minimum levels of acceptable profit or gross margin performance Activity quotas- minimal expectations of activities for each salesperson

11. Compensation and Evaluation Salary- regular payment regardless of performance Incentive pay- incentives tied to some level of performance Commission- incentive pay paid for an individual sale Bonus- incentive pay given for overall performance in one or more areas Straight salary- fixed amount of money for work during a specified time Straight commission- pays a certain amount per sale and includes a base and a rate, but not a salary Commission base- unit sales, dollar sales, or gross margin Commission rate- determines the amount paid (% of base or $ amount) Draw- money paid to the salesperson against future commissions Combination plans- provides salary and commission – great flexibility

12. Field Sales Managers • They hire salespeople, evaluate their performance, train them, and perform other important tasks Evaluating Performance • Easiest method of evaluating performance is adding up the amount of sales that the salesperson makes • Must also rate salespeople’s customer service level, product knowledge, and other less tangible qualities • Salespeople’s records and reports are an important communication tool Training • New hires and refresher training for experienced salespeople • Welcome training no matter how successful you are

13. Managing Ethics In Sales Ethics And The Sales Executive • Sales executive’s must determine corporate policy concerning what is considered ethical and how unethical behavior will be investigated and punished Open-door policies- general management techniques that allow subordinates to bypass immediate managers and take concerns straight to upper management when the subordinates feel a lack of support from their immediate manager Ethics review boards- provide expert advice to salespeople who are unsure of the ethical consequences of an action • Ethical treatment is expected from the company Cap- limit placed on a salesperson’s earnings – no cap is the ideal so salespeople are motivated to high performance

14. Ethics and The Field Manager • Usually the first person to investigate complaints of unethical behavior • Field managers are good role model for salespeople • Responding To Unethical Requests – • See Exhibit 16.5 - P.440 • Remember our “Sandwich effect” method of handling unethical dilemmas on the spot - Goal: Be ethical, practical and smart

15. Salespeople As Partners Geographic Salespeople • Assigned a specific geographic territory in which to sell the company’s products and services • (Branches, zones, or regions - Ex. ZIP codes) Account Salespeople • Salespeople are often divided between new accounts, existing accounts, specialized accounts and similar accounts Key account- large accounts that receive special treatment National account managers (NAM) or Strategic account managers (SAM)- sales executive responsible for managing and coordinating sales efforts on a single account nationwide House account- assigned to a sales executive rather than the specific salesperson assigned to the territory in which the account is located

16. Product Specialist • Used when companies have a diverse array of products • Must coordinate their activities with those of salespeople from other divisions Inside Versus Outside Field salespeople (outside salespeople)- sell at their customer’s location Inside salespeople- sell at their own company’s location Field support rep- telemarketer who works with field salespeople and does more than prospect for leads Customer service reps- inbound salespeople who handle customer concerns Inbound- respond to telephone calls placed by customers Outbound- telemarketer makes the phone call

17. Sales Teams Team selling- employees with varying areas of expertise within the firm work together to sell to the same account Multilevel selling- strategy that involvesusing multiple levels of company employees to call on similar levels in an account • Another type of sales team is made up of the field rep and the field support rep

18. Questions?