A sales job is different from other jobs and is vital to a company’s well being. Salespeople often provide innovative solutions to problems and in doing so must satisfy many different people. As a result, salespeople often experience role conflict.
Sales management today is quite different from what it was years ago. It needs new rules roles, new tasks, and new skills to perform them.
Functions of Sales Management
A sales manager has to perform various functions and duties of sales management.
1. Setting Sales Objectives
The first task in sales management is to determine the sales objectives.
Setting objectives helps in assigning definite roles and duties to Salesforce.
It also facilitates the determination of the size and quality of the salesperson.
2. Formulating Sales Plans
The sales manager has to plan for the long-range sales operations in consultation with top managers.
It involves much thinking, foresight and sound judgment.
It involves decisions regarding the nature and number of products to be distributed and the sales policies to be adopted.
3. Setting Terms and Policies
Sales policy provides guidance to govern sales operations.
A sales manager decides policies regarding products to be sold, branding and packaging, prices of products, discounts, resale price maintenance, advertising, etc.
He also sets selling terms relating to credit sale, delivery schedule, payment, the return of unsold goods, brokerage, etc.
4. Sales Budget
Sales budgeting is the instrument of planning. It gives item-wise, product wise, territory wise, sales for the years to come.
It provides a breakup picture of likely sales revenues and expenses.
A sales manager presents the budget estimates of Salesforce and selling activities.
5. Sales Forecasting
It is a function of the sales manager to know where customers are located and to predict how much they will buy.
He prepares estimates of maximum demand and potential that a firm expects to achieve during a specified time period.
6. Sales Strategies
Today’s sales managers are being challenged to think strategically in order to improve sales performance.
They have to anticipate strategic trends in the industry and to make the appropriate adjustments. They have to consider competitors’ plans.
7. Sales Organisation
The sales manager set up the organizational structure of his department.
For this purpose, he distributes work and duties, fixes responsibilities, establishes the superior-subordinate relationship, and delegates authority. He, then, coordinates the activities of various selling units.
He also decides about the span of control, specialization, geographical sales organization, customer and product specialization, cross-functional coordination and other related issues.
8. Designing and Managing Salesforce
The best executive is the one who has enough sense to pick good people to do what he wants to be done and self-restraint enough to keep from meddling with them while they do it.
Because Sales Management is responsible for developing and achieving results through Salesforce, it is important to understand the role and responsibilities of Salesforce.
Salesforce designs sales for decisions on objectives, strategies, structures, and composition of salespeople.
9. Establishing Salesforce Objectives
The sales personnel of a company are a part of its marketing mix.
They perform personal selling activities. They perform the task of finding and cultivating customers communicating with customers selling, servicing, information gathering and evaluating customer potentiality.
The salesman must spend 25% of the time with prospective customers.
Better managed companies determine certain objectives about the time the salespersons should spend in each activity.
If objectives are not decided, the salespersons will tend to spend most of their time selling established products to known customers and neglect other important market development activities.
10. Designing Salesforce Strategies
The salesforce strategy is made after understanding the customer buying process.
It is prepared in the way in which the Salesforce competencies’ can be used vise a vise the competitor’s efforts.
Salesforce strategy depends on the type of selling situation.
11. Structuring the Salesforce
Firms usually structure Salesforce on a territory basis on a product basis.
The Salesforce structure will be simple when the company sells one product line to one category of customers in many locations.
If the company sells many products, it might need either a product structured or market structured Salesforce.
Various types of cells design structures are possible-
1. Territory Based
Here, each salesman represents the firm’s full product line in a specific territory.
This structure defines the salesman’s responsibilities clearly.
It also encourages the salesman to develop personal and business ties in the area. It also reduces travel expenses.
2. Product Based
When the products are technically Complex, highly unrelated or very complex, a product structured sales force is necessary.
This design structure allows the salesman to be more thoroughly aware of the customer’s needs.
There are various ways of structuring a Salesforce by customer. These include breakdowns by size, nature of the business, and method of distribution.
4. Key Accounts
Sometimes, sales efforts are being organized on the basis of major accounts.
12. Determining the Size of the Salesforce
The size of the Salesforce has to be fixed at the optimum level. It can be worked out on an ‘equalizing workload‘.
This method assumes that management has determined the economical number of sales to make accounts of different sizes.
Some sales managers determine the size by the number of sales, rather than the other way around.
13. Sales Coordination
The sales manager is also concerned with obtaining effective coordinating involving 1. the organization, 2. the planning, and the other elements in the marketing strategy.
Sales coordination minimized conflicts regarding roles, duties, and work assigned to self staff.
14. Sales Analysis
The sales manager analyses sales volume performance to detect strengths and weaknesses.
Through sales analysis, management seeks insight on strong and weak territories, high volume and low volume products, and types of customers providing satisfactory and unsatisfactory sales volume.
It provides information that management needs to allocate sales effort effectively.
15. Information Reporting
Sales managers are responsible for the supply of information critical to the making of key marketing decisions, such as those on budgeting, quotas, and territories.
16. Decision Participation
Sales managers participate, to an extent that varies with the company – in decisions on products, marketing channels and distribution policies, advertising and other promotion, and pricing.
Thus, the sales manager is both an administrator in charge of personal selling activity and a member of the executive group that Makes marketing decisions of all types.
The sales manager is responsible for designing sales programs and sales management process. He determines the roles of Salesforce.
He defines the activities and responsibilities of the Salesforce and constructs the formal organization of the sales operation.
Then he develops a competent Salesforce. At last, he manages the Salesforce by leading, motivating, compensating, evaluating performance.
18. Market Survey
The sales manager conducts market research to gain knowledge about tastes, likings, brand preferences, and economic conditions of the customer so as to decide pricing and product policies.
19. Recovery on Credit Sales
The sales manager ensures the arrangements for the recovery of outstanding amounts on sales from the buyers.
20. Office Work
It is an important function of the sales manager to look after the office work with regard to purchases office equipment, stationary, and filling system.
He also administers the sales staff in his department.
21. Data Bank
He collects relevant information, data, and facts through the Salesforce operating in the fields.
These figures enable him to forecast demand, sales, and to make proper sales strategies.
22. Sales Research
Sales research is undertaken occasionally to improve sales processes, techniques and to judge the marketing and customer characteristics keeping in view of changing marketing conditions.
23. Image Building
A sales manager is responsible for creating a proper image for the company and its products and services.
24. Building Distributive Network
Securing and maintaining a harmonious working relationship with distributive networks is an important function of sales management.
Dealer apathy is Common. To overcome it, the sales manager identifies the reasons lying behind it and takes positive action to increase dealer selling effort.
25. Managing the Salesforce
Sales management involves the direction and control of salesmen, sales planning, budgeting, policymaking, coordination of marketing research, advertisement, sales promotion and merchandising, and the integration in the marketing program of all business activities that contribute to the increased sales and profits.
26. Advising the Top Management
The actual progress of the sales operations is to be brought to the notice of top management.
The sales manager presents expansion programs of sales, recommends the opening of new branches, and renders information about his department. 7 Major Sales Management Challenges in the 21st Century (Explained).
27. Overseas Selling Activities
Sales management obtains Overseas distributors and dealers, maintains the relationship with these distributive networks, and monitors continuing changes in marketing conditions and needs in national markets.
It formulates sales strategies at the international level.
Thus, now you know what are the important functions of sales management.