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Sales and Distribution Management

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Presentation on theme: "Sales and Distribution Management"— Presentation transcript:

1 Sales and Distribution Management
Mr. Ankit Bajpai By: Ankit Bajpai 1

2 Nature of Personal Selling
Most salespeople are well-educated, well-trained professionals who work to build and maintain long-term relationships with customers. The term salesperson covers a wide spectrum of positions from: Order taker (department store salesperson) Order getter (someone engaged in creative selling) Missionary salesperson (building goodwill or educating buyers) By: Ankit Bajpai

3 What is Personal Selling?
Involves Two-Way, Personal Communication Between Salespeople and Individual Customers Whether: face to face, by telephone, through video conferencing, or by other means. By: Ankit Bajpai

4 The Role of the Sales Force
Personal selling is effective because salespeople can: probe customers to learn more about their problems, adjust the marketing offer to fit the special needs of each customer, negotiate terms of sale, and build long-term personal relationships with key decision makers. By: Ankit Bajpai

5 The Role of the Sales Force
Represent the Company to Customers to Produce Company Profit Sales Force Serves as a Critical Link Between a Company and its Customers Since They: Represent Customers to the Company to Produce Customer Satisfaction By: Ankit Bajpai

6 Characteristics of Personal Selling
Flexibility Identify best prospects Adapt to situations Engage in dialogue Builds Relationships Long term Assure buyers receive appropriate services Solves customer’s problems By: Ankit Bajpai 6

7 Personal Selling Limitations
Can not reach mass audience Expensive per contact Numerous calls needed to generate sale Labor intensive By: Ankit Bajpai 7

8 Personal Selling Tasks
Order taking Routine writing up orders checking invoices assuring prompt order processing Suggestive selling By: Ankit Bajpai

9 Personal Selling Tasks
Order getting Seeking out customers Creative selling Pioneering Account management By: Ankit Bajpai

10 Personal Selling Tasks
Missionary Detailer Goodwill “Closers” Cross-functional Account service rep By: Ankit Bajpai 11

11 Some Traits of Good Salespeople
Persistence Enthusiam Job Commitment Self-Confidence Initiative By: Ankit Bajpai

12 Steps in the Selling Process
Step 1. Prospecting and Qualifying Steps in the Selling Process Step 2. Pre-approach Identifying and Screening For Qualified Potential Customers. Step 3. Approach Learning As Much As Possible About a Prospective Customer Before Making a Sales Call. Step 4. Presentation/ Demonstration Knowing How to Meet the Buyer to Get the Relationship Off to a Good Start. Telling the Product “Story” to the Buyer, and Showing the Product Benefits. By: Ankit Bajpai

13 Steps in the Selling Process
Step 5. Handling Objections Steps in the Selling Process Step 6. Closing Seeking Out, Clarifying, and Overcoming Customer Objections to Buying. Asking the Customer for the Order. Step 7. Follow-Up Following Up After the Sale to Ensure Customer Satisfaction and Repeat Business. By: Ankit Bajpai

14 Alternative Steps: Find ’em Sell ‘em Keep ‘em Grab ‘em Show ‘em
Answer ‘em Sell ‘em Keep ‘em By: Ankit Bajpai

15 Creative Selling Process
Identify and Qualifying Prospects Prospecting: Identifying likely new customers Leads Qualifying: Evaluating a prospect’s potential By: Ankit Bajpai

16 Creative Selling Process
Approaching the Prospect Contact Rapport “Only one chance to make a first impression” By: Ankit Bajpai

17 Creative Selling Process
Sales Presentation Persuasive communication Attention Interest Desire “Tell the product’s story” By: Ankit Bajpai

18 Creative Selling Process
Handling Objections Questions Reservations Understand Concern Counterarguments Acknowledge concern Clues to process By: Ankit Bajpai

19 Creative Selling Process
Closing the Sale Closing signals Trial close Ask for the sale By: Ankit Bajpai

20 Creative Selling Process
Following Up Commitments met Shipment Performance Reinforce relationship Satisfied customers rebuy & recommend By: Ankit Bajpai

21 Sales Management Planning Organizing Controlling Directing Setting
objectives Organizing activities Organizing Controlling Recruit, select, train, develop, manage, & motivate Directing Motivate, evaluate, & control By: Ankit Bajpai

22 Organizing Sales Activities
Sales Territory: Geographic divisions Customer types Product lines Selling task By: Ankit Bajpai

23 Geographic Division By: Ankit Bajpai Vice-President
Marketing Regional Sales Manager District Sales Manager Sales Rep California Pacific NW Southeast Northeast By: Ankit Bajpai

24 Customer Type By: Ankit Bajpai Vice-President Sales
New Accounts Manager Existing Accounts New Account #1 #2 Existing Account #1 Account #2 By: Ankit Bajpai

25 Product Line By: Ankit Bajpai Vice-President Sales
Snack Foods Sales Manager Beverages Sales Rep Eastern Region West’n Region Sales rep By: Ankit Bajpai

26 Directing the Sales Force
Recruiting and selecting Training & develop Compensating Motivating By: Ankit Bajpai

27 Compensation Methods Straight salary or wage Salary plus commission
Quota-bonus plan Commission with draw By: Ankit Bajpai

28 Evaluation and Control
Required reports Measurement against plan or sales standards Expense control Productivity New account development By: Ankit Bajpai 30

29 Ethical Issues Kickbacks, bribes and “gifts” Price discrimination
Cheating on expense accounts Misrepresentation By: Ankit Bajpai 31

30 Distribution Channel Design
and Management By: Ankit Bajpai

31 Distribution’s Function
The major purpose of marketing is to satisfy human needs by delivering products of various types to buyers when and where they want them and at a reasonable cost. The “when and where” is the function of Distribution By: Ankit Bajpai 2

32 What is a Distribution Channel?
A set of interdependent organizations (intermediaries) involved in the process of making a product or service available for use or consumption by the consumer or business user. Marketing Channel decisions are among the most important decisions that management faces and will directly affect every other marketing decision. By: Ankit Bajpai

33 Why are Marketing Intermediaries Used?
The use of intermediaries results from their greater efficiency in making goods available to target markets. Offer the firm more than it can achieve on it’s own through the intermediaries: Contacts, Experience, Specialization, Scale of operation. Purpose: match supply from producers to demand from consumers. By: Ankit Bajpai

By: Ankit Bajpai 3

35 Distribution Channel Functions
Information Distribution Channel Functions Transfer Communication Payments Negotiation Physical Distribution Ordering Risk Taking Financing By: Ankit Bajpai

36 Typical Channels of Distribution

37 Business-to-Business Channels
Direct Wholesaler Agent By: Ankit Bajpai 21

38 Business-to-Business Channel Trends
Disintermediation Infomediaries & Vertical Exchange By: Ankit Bajpai 21

39 Conventional Distribution Channel vs. Vertical Marketing Systems
Manufacturer Manufacturer Wholesaler Wholesaler Retailer Retailer Consumer Consumer By: Ankit Bajpai

40 Common Ownership at Different
Corporate Common Ownership at Different Levels of the Channel Types of Vertical Marketing Systems Administered Leadership is Assumed by One or a Few Dominant Members Contractual Contractual Agreement Among Channel Members By: Ankit Bajpai

41 Vertical Marketing Systems
Corporate systems - total ownership Contractual - legal relationships Administered - strong leadership By: Ankit Bajpai 23

42 Planning the Channel of Distribution
Determining the structure Marketing mix strategy Organizational resources External environmental factors Market characteristics Consumer preferences and behavior The nature and availability of Intermediaries Other environmental factors By: Ankit Bajpai 26

43 Customers’ Desired Service Levels
Lot size Waiting time Spatial convenience Product variety Service backup By: Ankit Bajpai

44 Steps in Distribution Planning
By: Ankit Bajpai

45 Choosing a Distribution System
Intensive Distribution Exclusive Selective Intensity By: Ankit Bajpai

46 Intensive Distribution
Producer Seeks to obtain maximum product exposure at the retail level Retailer By: Ankit Bajpai

47 Selective Distribution Product is sold in a limited number of outlets
Producer Product is sold in a limited number of outlets Retailer By: Ankit Bajpai

48 Exclusive Distribution
Producer Product is sold in only one outlet in a given area Retailer By: Ankit Bajpai

49 Developing Distribution Tactics
Selecting Channel Partners Managing the Channel of Distribution Channel Leader Power Developing Distribution Tactics Distribution Channels & the Marketing Mix Economic Power Legitimate Power Reward or Coercive Power By: Ankit Bajpai

50 Physical Distribution
Order Processing Received Processed Shipped Inventory Control When to order How much to order Physical DistributionFunctions Warehousing Number Needed Where What Type Transportation Rail, Water, Trucks, Air, Pipeline, Internet Materials Handling Moving Products Into, Within, and Out of Warehouses By: Ankit Bajpai

51 Transportation Modes By: Ankit Bajpai Rail Water
Cost-effective for shipping bulk products, piggy-back, fishyback, birdyback. Water Low cost for shipping bulky, low-value, non perishable goods, slowest form. Truck Most important carrier for consumer goods, flexible. Air High cost, ideal when speed is needed or distant markets have to be reached Pipeline Carry petroleum based products, very low cost, requires little energy. Internet Web sites have products available, used especially for services. By: Ankit Bajpai

52 Channel Relationships
Cooperation Conflict Power Coercive Expert Legitimate By: Ankit Bajpai 28

53 Decision Making Framework
Prospects of Destructive Conflict Importance of threatened channel in terms of current or potential volume or profitability High Low High (FIRE) Act to avert or address conflict Allow threatened channel to decline Low (Smoke) Look for opportunities to reassure threatened channel and leverage your power Do nothing By: Ankit Bajpai

54 Channel Conflict: Identifying Threats
First, are the channels really attempting to serve the same end users? Second, do channels mistakenly believe they are competing when in fact they are benefiting from each other's actions? Third, is the deteriorating profitability of a griping player genuinely the result of another channel's encroachment? Fourth, will a channel's decline necessarily harm a manufacturer's profits? By: Ankit Bajpai

55 Managing Channel Conflict
WHEN TWO OR MORE CHANNELS TARGET THE SAME CUSTOMER SEGMENT Differentiate the Channel offer Define Exclusive Territories Enhance or Change the Channels Value By: Ankit Bajpai

56 Managing Channel Conflict
CHANNEL ECONOMICS DETERIORATE Change the channels economic formula: (Grant rebates if an intermediary fulfill certain requirements; Adjust margins between products to support different channel economics; and Treat channels fairly to create level playing field) Create Segment Specific Programs (certain services not available via direct channels) Complement value proposition of the existing channel by introducing a new channel Foster consolidation among intermediaries in a declining channel By: Ankit Bajpai

57 Managing Channel Conflict
THREATENED CHANNEL STOP PERFORMING OR RETALIATE AGAINST THE SUPPLIER Leverage Power (eg. Strong Brand) against the channel to prevent retaliation Migrate volume to winning channel Back off By: Ankit Bajpai

58 Other Distribution Management Issues
Reverse distribution One Coca Cola Distributor One thousand retailers OK Difficult Ethical, Political, & Legal By: Ankit Bajpai 29

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