1. Chapter 16 Managing Within Your Company

2. Learning Objectives
Which areas of the company work with salespeople to satisfy customer needs?
How do salespeople coordinate the efforts of various functional areas of the company?
How do salespeople work with sales managers and sales executives?

3. Learning Objectives
How do company policies, such as compensation plans, influence salespeople?
How do salespeople work within the company to resolve ethical issues?
What is the organizational structure, and how does it influence salesperson activities?

4. Internal Partnerships
Relationships between a salesperson and another member of the same company
Importance
Salesperson must represent the customer to the company
Ability to work with groups inside the company can directly affect the sales representative’s compensation

5. Internal Partnerships
Role of sales
Selling a company, its products, and its services to customers
Selling customers’ needs to companies
Selling internally
Salespeople have to trust their coworkers to do their respective jobs properly

6. Principles of Selling Internally
Accept responsibility
Appeal to a higher objective
Understand the personal and professional needs
Address the internal customer needs
Increase the internal customer’s sense of urgency
Never personalize
Negotiate

7. Company Areas Important to Salespeople
Manufacturing
Administration
Shipping
Customer service
Marketing
Sales

8. Manufacturing
Concerned with producing product at the lowest possible cost
Negotiations and compromises are necessary between manufacturing and customers
Salespeople have to develop relationships with manufacturing
Better new product designs come from collaborative relationships between salespeople and manufacturing

9. Administration
Deals with order entry, billing, credit, and employee compensation
Salespeople have to understand the needs of the credit department and assist in collecting payments
Better positions the salesperson to help customers receive credit

10. Shipping Scheduling of product shipments may:
Be part of sales administration
Be part of manufacturing
Stand alone
Salespeople require the aid of the shipping department to complete their deliveries
Scheduling of product shipments should be done in consultation with the shipping department

11. Customer Service Salespeople need to interact with customer service
Close relationships and support of customer or technical service representatives mean:
Better, faster, and more direct information flow to the salesperson
Salespeople help customer service by:
Setting reasonable expectations for product performance with customers
Handling complaints promptly

12. Marketing Develops the promotions and products that salespeople sell
Highly coordinated with sales
Salespeople inform the marketing department of:
Competitor actions
Customer trends
Important market information

13. Marketing
Serves salespeople by using information to create promotional programs or designing new products
Responsible for generating leads through:
Trade show exhibiting
Direct mail programs
Advertising
Public relations

14. Sales Management Sales executive
Manager and at the top of the sales force hierarchy
Plays a vital role in determining the company’s strategies with respect to:
New products and markets
Sales forecasts
Prices
Competition

15. Sales Management Size and organization of the sales force Forecasting
Sales executive determines the number and type of salespeople needed to achieve the company’s sales and customer satisfaction goals
Forecasting
Bottom-up forecasting: Adding each salesperson’s own forecast into a forecast for total company sales

16. Sales Management Expense budgets Control and quota setting
Used to control costs
May be expressed in dollars or as a percentage of sales volume
Control and quota setting
Quota: Quantitative minimum level of acceptable performance for a specific period
Useful for controlling the sales force

17. Sales Management Sales quota: Minimum number of sales in units
Revenue quota: Minimum sales revenue necessary for acceptable performance
Profit quotas/gross margin quotas: Minimum levels of acceptable profit or gross margin performance
Activity quotas: Minimal expectations of activities for each salesperson
Motivate the sales force to sell more profitable products or to sell to more profitable customers

18. Sales Management Compensation and evaluation Compensation system must
Important in situations where the sales cycle is long and sales are few
Compensation and evaluation
Compensation system must
Satisfy the needs of both the salespeople and the company
Be uniform within the company and in line with what competitors’ salespeople receive

19. Sales Management Salary: Regular payment regardless of performance
Incentive pay: Pay tied to some level of performance
Commission: Incentive pay for an individual sale
Bonus: Incentive pay for overall performance in one or more areas

20. Sales Management
Straight salary method: Fixed amount of money for work during a specified time
Straight salary plans are used when:
Sales require long periods of negotiation
A team of salespeople is involved and individual results cannot be measured
Other aspects of the marketing mix are more important than the salesperson’s efforts in generating sales

21. Sales Management
Straight commission: Pays a certain amount per sale and includes a base and a rate but not a salary
Commission base: Item from which commission is determined
Provides more financial incentive for the salesperson to work hard
Commission rate: Determines the amount paid
Expressed as a percentage of the base or as a dollar amount

22. Sales Management
Draw: Money paid to a salesperson against future commissions
Combination plans: Provide salary and commission
Offer the greatest flexibility for motivating and controlling the activities of salespeople

23. Field Sales Managers Evaluating performance Training
Must rate their salespeople’s customer service level, product knowledge, and other, less tangible qualities
Training
Trains new hires
Provides refresher training for experienced salespeople

24. Managing Ethics in Sales
Sales executive’s job is to:
Determine corporate policy and its ethical nature
Support positive behaviors and ensure that policies support the ethics of the organization
Sales executives must encourage:
Ethics review boards: Consist of experts to review ethics policies and act as a sounding board for employees
Training courses in ethics
Development of formal policies

25. Managing Ethics in Sales
Open door policies: General management techniques that allow subordinates to bypass immediate managers and take concerns straight to upper management
Field sales manager
Acts as a role model by demonstrating ethical behavior in role plays
During training or when conducting sales calls in the field
Must avoid teaching high-pressure techniques and manipulative methods of selling

26. Exhibit 16.5 - Strategies for Handling Unethical Requests

27. Types of Salespeople Geographic salespeople Account salespeople
Assigned a specific geographic territory in which to sell the company’s products and services
Account salespeople
Some develop new accounts while others maintain existing accounts
Key accounts: Large customers who have a salesperson assigned only to that account

28. Types of Salespeople
National account managers (NAMs)/Strategic account managers (SAMs): Company executives who coordinate all the salespeople who call on an account throughout the nation or the world
House accounts: Handled by a sales or marketing executive in addition to that executive’s regular duties
No commission is paid on any sales from that account
They are key accounts, but not all key accounts are house accounts

29. Exhibit 16.6 - SAMs in the Sales Force

30. Types of Salespeople Product specialists Inside versus outside
Specializing in types of products
Inside versus outside
Field salespeople: Sell at the customer’s location
Inside salespeople: Sell at their own company’s location
Account managers, field support reps, and customer service reps

31. Types of Salespeople
Field support rep: Telemarketer who works with field salespeople and does more than prospect for leads
Customer service rep: Inbound salespeople who handle customer concerns
Inbound: Respond to telephone calls placed by customers
Outbound: Telemarketer makes the phone call

32. Sales Teams
Team selling: Group of salespeople supporting a single account
Every team member brings a unique area of expertise or handles different responsibilities

33. Exhibit 16.7 - Team Selling Organization

34. Sales Teams
Multilevel selling: Members, at various levels of the sales organization, calling on their counterparts in the buying organization
Can take place without a formal multilevel sales team
Another type of sales team is made up of the field rep and the field support rep

35. Exhibit 16.8 - Forming Sales Teams for Multilevel Selling