1. McGraw-Hill/Irwin Copyright © 2009 by the McGraw-Hill Companies, Inc. All rights reserved.

2. Chapter 13 Sales and Sales Management

3. THE KEY ROLES OF SALESPEOPLE 1.THE SELLING FUNCTION 2.MANAGE CUSTOMER RELATIONSHIPS 3.GATHER INFORMATION From Customers From Competitors About Market Forces 13-3

4. SALES ROLE IN THE ORGANIZATION MANAGE RELATIONSHIPS CREATE CUSTOMERS FOR LIFE PROVIDE CUSTOMER SERVICE COORDINATE CORPORATE RESOURCES GATHERING INFORMATION CUSTOMER DIALOGUE IS USEFUL OBTAIN COMPETITIVE INFORMATION 13-4

5. DETERMINING THE SALES STRATEGY OPTION TO FIT YOUR CUSTOMER 1.SCRIPT-BASED SELLING—Used when all customers’ needs are similar 2.NEEDS SATISFACTION SELLING—Identifying buyers’ needs and selling to them 3.CONSULTATIVE SELLING—Bring specialized expertise for a customized solution 4.STRATEGIC PARTNER SELLING—Seller-Customer joint effort for developing product solutions Exhibit 13-1 13-5

6. Limited relationships Failure to monitor competitors or industry Complacency Generate reorders Upgrade Full-line sell Secure complete commitment from both companies Manage change Exploration Awareness Commitment Expansion Set correct expectations Ensure proper initial use Follow up Make personal visits Handle complaints Achieve customer satisfaction Dissolution Exhibit 13-2 STAGES IN RELATIONSHIP BUILDLING 13-6

7. PARTNERSHIP COMMUNICATION: FROM SINGLE LEVEL TO MULTI-LEVEL Buying Company Selling Company Engineering Marketing Sales Finance Credit and Billing Shipping & Receiving Production Marketing Accounting Finance Purchasing Department Shipping & Receiving Production Marketing Accounting Finance Purchasing Shipping & Receiving Buying Company Engineering Marketing Credit & Billing Finance Sales Purchasing Shipping & Receiving Selling Company BEFORE PARTNERING AFTER PARTNERING Purchasing Agent Salesperson Exhibit 13-4 13-7

8. SALES ORGANIZATION OPTIONS 1.ORGANIZE GEOGRAPHICALLY USING CITIES, STATES, COUNTRIES, ZIP CODES, BY ACCOUNT 2.ORGANIZE BY PRODUCT AND DEVELOP SPECIALISTS FOR EACH PRODUCT CATEGORY 3.USE SALES TEAMS TO DEVELOP AND KEEP NEW BUSINESS. 13-8

9. BUYING AND SELLING TEAMS STREAMLINE MULTILEVEL SELLING Vice President Of Purchasing Vice President Of Sales Director of Purchasing Account Manager Engineer Product Specialist Buying Company Selling Company Exhibit 13-5 13-9

10. CUSTOMER FOCUSED TEAM STRUCTURE Account Consultant F&A Rep. Customer Sales Specialists Account Manager Team Leader Manufacturing Finance and Accounting Other Business Units Other Rep.(s) Purchasing Agent Shipping CSS Rep. Customer Support Service Purchasing Shipping Manager Sales Specialists Prod. / Ind. Mktg. Groups Exhibit 13-7 13-10

11. Exhibit 13-8 ALLOCATION GRID FOR SALES RESOURCES Relatively fewer resources should be allocated here Low Maintain sufficient resources to continue to reap the sales potential and strong position High Direct more sales resources here Assign to alternative method of communicating, such as telemarketing Weak Strong MARKET LIFETIME VALUE RELATIVE POSITION 13-11

12. DO YOU OUTSOURCE THE SALES FORCE? YES NO Establish relationships Salary and selling expenses can be limited Little/no up-front investment Loss of control over sales presentation Products may not be a selling priority with representative TO MAKE IT WORK: INVEST IN TRAINING AND MERCHANDISING MATERIALS 13-12

13. SALES FORCE CONTROL MECHANISMS ESTABLISH QUOTAS – Fair and Understandable Activity Quotas Performance Quotas ESTABLISH COMPENSATION PLAN – Equitable, Stable, Understandable Straight Salary Straight Commission Combination Plans Bonus System MOTIVATION ACTIVITIES– Keep Sales Force Producing 13-13

14. MANAGER’S DILEMMA: EVALUATING PERFORMANCE & MAINTAINING MOTIVATION 1.REVIEW SPECIFIC SALES OBJECTIVES 2.OBTAIN APPROPRIATE PERFORMANCE DATA (outcomes and effort) 3.EVALUATE WHAT WAS BEYOND SALESPERSON’S CONTROL 4.IDENTIFY PROBLEMS AND OPPORTUNITIES 5.CREATE A STRATEGY THAT RESOLVES PROBLEMS AND SEIZES OPPORTUNITIES 5 STEPS TO EVALUATE SALES FORCE PERFORMANCE Exhibit 13-11 13-14

15. RECOGNIZING AND IDENTIFYING A PROBLEM Expectations Enormity of problem rests on length of this difference Results PROBLEM RECOGNITION 1.Our sales are down: WHY? 2.We can’t see customers: WHY? 3.We can’t make appointments on time : WHY? 4.We spend too much time covering territory : WHY? 5.Our territories are too big : WHY? 6.We don’t have enough salespeople : WHY ? THE 6xWHY FILTER Ask the WHY question at least six times (or as many times as necessary) PROBLEM IDENTIFICATION “ The Problem ” CONCLUSION / PROBLEM We haven’t matched demand to our sales force. 13-15