Assignment Code: MMPM-002/TMA/SEM-II/2022-23

Course Code: MMPM-002

Assignment Name: Sales Management

Year: 2022-2023

Verification Status: Verified by Professor

Attempt all the questions and submit this assignment to the coordinator of your study centre. Last date of submission for July 2022 session is 31st October 2022 and for January 2023 session is 30th April 2023.

Q1) (a) Trace the evolution of sales management functional. Explain the role of sales function in marketing and the key decision areas which guide in the formulation of sales strategy.

Ans) Sales management has undergone significant changes since the beginning of the 20th century. The evolution of sales management functional can be divided into three main periods: the pre-Industrial Revolution period, the Industrial Revolution period, and the post-Industrial Revolution period.

The pre-Industrial Revolution period (before the mid-1800s) was characterized by a lack of formal sales management. During this period, selling was done by the owner of the business or by traveling salespeople who were responsible for finding customers and closing deals. Salespeople had very little control over the sales process and often had to rely on their own intuition to make sales.

During the Industrial Revolution period (mid-1800s to early 1900s), sales management began to take shape. The growth of manufacturing and transportation made it possible to sell products on a larger scale. Salespeople became more specialized, and sales managers were hired to oversee their activities. Sales management became more formalized, and the first sales training programs were developed.

In the post-Industrial Revolution period (mid-1900s to present), sales management has continued to evolve. Sales management has become more sophisticated, with the development of sales analytics and the use of technology to improve the sales process. Salespeople have become more specialized, and sales organizations have become more complex.

The role of sales function in marketing is critical. Sales is the final step in the marketing process, and it is responsible for converting leads into customers. The sales function helps to build relationships with customers and is often the first point of contact with them. The sales function is also responsible for understanding the customer's needs and providing them with the right products or services.

b) Explain the reasons for the growing importance of personal selling in the Indian context. Elaborate the situations conducive for personal selling.

Ans) Personal selling is the process of selling products or services through face-to-face interactions between sales representatives and potential customers. In the Indian context, personal selling has become increasingly important due to several reasons:

1. Diverse and Complex Market: India is a highly diverse and complex market, with varying cultures, languages, and consumer preferences across different regions. Personal selling allows companies to tailor their sales approach to individual customers, which is essential in such a diverse market.

2. Highly Competitive Market: The Indian market is highly competitive, and customers are often looking for personalized attention and support. Personal selling can provide this level of attention and build strong relationships with customers, giving companies a competitive advantage.

3. Preference for Face-to-Face Interactions: Many Indian consumers prefer face-to-face interactions when making purchasing decisions, as it allows them to ask questions, negotiate prices, and receive customized solutions. Personal selling can provide this level of interaction and build trust between the customer and the sales representative.

4. Complex Products or Services: Personal selling is particularly useful when the product or service being sold is complex or expensive, as customers often need additional information and support to make informed decisions.

5. Small Customer Base: Personal selling is also useful when the customer base is small, and sales representatives can develop personal relationships with each customer. This approach can lead to increased customer loyalty and repeat business.

Situations that are conducive for personal selling include when the product or service being sold is complex or expensive, as customers often need additional information and support. Personal selling is also useful when the customer base is small, and sales representatives can develop personal relationships with each customer.

Q2) (a) How and why communication skills are vital in sales situations that help in better understanding in sales transactions. Discuss with an example.

Ans) Communication skills are vital in sales situations because they help salespeople to better understand the needs and preferences of their customers, as well as effectively communicate the features and benefits of their products or services. Good communication skills enable salespeople to establish rapport with customers, build trust, and persuade them to make a purchase.

For example, suppose a salesperson is selling a high-end smartphone to a potential customer. The salesperson must possess excellent communication skills to effectively explain the features and benefits of the phone to the customer. They must also listen actively to the customer's needs and preferences, and tailor their pitch accordingly. If the customer is interested in the phone's camera capabilities, the salesperson should highlight those features and demonstrate them to the customer. The salesperson must also be able to address any concerns or objections the customer may have and provide additional information or solutions to any issues.

Effective communication skills also involve using appropriate body language, tone of voice, and language that matches the customer's level of understanding. For instance, if the customer is not tech-savvy, the salesperson must explain the features in simple language and avoid technical jargon. Similarly, the salesperson must use positive body language, such as maintaining eye contact and a friendly smile, to build trust and establish rapport with the customer.

Effective communication skills are vital in sales situations as they help salespeople to better understand their customers' needs and preferences, effectively communicate the features and benefits of their products or services and persuade them to make a purchase. Good communication skills involve active listening, tailoring the sales pitch to the customer's needs and preferences, and using appropriate body language, tone of voice, and language.

Q2) (b) Distinguish merchandising and sales displays. Comment on the various types of sales displays that you are familiar with.

Ans) Merchandising and sales displays are two different concepts in the world of retail marketing. While they are related to each other, they serve different purposes and have different objectives. Merchandising refers to the way products are displayed in a retail environment to increase sales and improve the customer experience. Merchandising involves everything from product placement and store layout to pricing and promotions. The goal of merchandising is to create an attractive and engaging shopping environment that encourages customers to make purchases. Sales displays, on the other hand, are temporary displays set up in a retail environment to showcase a particular product or promotion. Sales displays are designed to draw attention to a specific product or offer and generate impulse purchases. The goal of sales displays is to create excitement and urgency around a product or promotion, and to increase sales in a short period of time.

Various types of sales displays include:

1. Window Displays: These are displays set up in the store's front window to showcase new products or promotions. Window displays are designed to grab the attention of passers-by and encourage them to enter the store.

2. Endcap Displays: These are displays set up at the end of store aisles to showcase a specific product or promotion. Endcap displays are designed to increase the visibility of the product and encourage customers to make an impulse purchase.

3. Point-of-Purchase Displays: These are displays set up near the cash register to encourage impulse purchases. Point-of-purchase displays are usually small, eye-catching displays that showcase a specific product or promotion.

4. Interactive displays: These are displays that allow customers to interact with the product in some way.

5. Seasonal Displays: These are displays set up to showcase products related to a particular season or holiday.

Q3) (a) Discuss the major sources of recruitment that you would consider for the selection of fresh management graduates for an FMCG company. Give reasons for the choice.

Ans) The recruitment of fresh management graduates is a critical process for any organization, especially for an FMCG company. FMCG companies require highly skilled and talented individuals who can manage their fast-paced and dynamic environment. The following are some of the major sources of recruitment that an FMCG company can consider for the selection of fresh management graduates:

1. Campus Recruitment: Campus recruitment is the most common source of recruitment for fresh management graduates. FMCG companies can visit renowned business schools and universities to recruit the best and brightest talent. Campus recruitment is an excellent way to connect with young and ambitious graduates who are eager to start their careers.

2. Employee Referral Programs: Employee referral programs are an effective source of recruitment as they enable employees to refer their friends, family members, and acquaintances for suitable positions in the company. Employee referral programs can help FMCG companies to identify talented individuals who have the potential to be successful in the organization.

3. Job Portals: Job portals are another effective source of recruitment for FMCG companies. Job portals such as Naukri.com, LinkedIn, and Monster.com enable companies to post their job openings and receive applications from interested candidates. Job portals help companies to reach a wider pool of candidates and reduce recruitment costs.

4. Social Media: Social media is an excellent source of recruitment for FMCG companies. Social media platforms such as LinkedIn, Facebook, and Twitter enable companies to connect with potential candidates and promote their job openings. Social media can help FMCG companies to reach a diverse pool of candidates and create a strong employer brand.

5. Internship Programs: Internship programs are an effective way to identify talented management graduates who can be potential employees in the future. FMCG companies can offer internships to management graduates and assess their skills, abilities, and work ethics. Internship programs can help FMCG companies to attract young talent and reduce recruitment costs.

Q3) (b) What is direct and indirect compensation with reference to salesman? Discuss with an example.

Ans) Direct and indirect compensation are two types of rewards that organizations provide to their employees. Direct compensation refers to the monetary rewards that employees receive, such as salaries, bonuses, and commissions. Indirect compensation, on the other hand, refers to the non-monetary benefits and perks that employees receive, such as health insurance, retirement plans, and paid time off.

In the context of salesmen, direct compensation includes the base salary, sales commissions, and bonuses. For example, a sales representative working for a pharmaceutical company may receive a base salary of $50,000 per year and a sales commission of 5% on every sale. Additionally, the company may offer bonuses for achieving certain sales targets, such as a bonus of $5,000 for exceeding the quarterly sales target.

Indirect compensation for salesmen may include benefits such as health insurance, retirement plans, and paid time off. For example, the pharmaceutical company may offer health insurance coverage, a 401(k)-retirement plan, and two weeks of paid vacation time to their sales representatives.

The importance of direct and indirect compensation for salesmen lies in the fact that it can motivate them to perform better and achieve their targets. Direct compensation, such as sales commissions and bonuses, can incentivize salesmen to work harder and make more sales. Indirect compensation, such as health insurance and retirement plans, can attract and retain high-performing salesmen.

However, it's important to note that compensation alone is not enough to motivate salesmen. Other factors, such as a supportive work environment, effective training, and clear performance expectations, also play a crucial role in their motivation and job satisfaction.

Q4) (a) What are the objectives of sales territories? Discuss the criteria in establishing sales territories.

Ans) Sales territories are specific geographic areas assigned to salespeople or teams to sell products or services to customers within those areas. The main objectives of sales territories are to increase sales revenue, improve customer satisfaction, and maximize sales efficiency. Sales territories help sales teams focus on a specific set of customers and provide a framework for the allocation of sales resources, such as time and budget. When establishing sales territories, there are several criteria that should be considered, including:

1. Customer Characteristics: The first criterion is customer characteristics, such as location, industry, size, and buying behaviour. Sales territories should be designed to serve customers with similar needs and buying patterns.

2. Geographic Location: The second criterion is geographic location. Sales territories should be defined based on geographical boundaries, such as cities, counties, or regions. This helps salespeople focus on a specific area and reduces travel time and costs.

3. Sales Potential: The third criterion is sales potential. Sales territories should be assigned based on the potential revenue that can be generated from each territory. This helps sales teams prioritize their efforts and allocate resources accordingly.

4. Sales History: The fourth criterion is sales history. Sales territories should be assigned based on the historical sales data of each area. This helps sales teams identify areas that are performing well and areas that need improvement.

5. Competition: The fifth criterion is competition. Sales territories should be designed to avoid overlap with competitors and ensure that sales teams are not competing for the same customers.

6. Salesperson's Skill Set: The sixth criterion is the salesperson's skill set. Sales territories should be assigned based on the salesperson's expertise, experience, and strengths. This helps sales teams maximize their potential by assigning them to territories where they can perform best.

By considering these criteria when establishing sales territories, companies can optimize their sales efforts and achieve their objectives more effectively.

Q4) (b) Explain sales management audit as a strategic dimension of sales control.

Ans) Sales management audit is a process of evaluating and analysing the performance of a company's sales management function, with the aim of identifying areas for improvement and ensuring that sales objectives are being met. It is a critical component of sales control, which is the process of monitoring and regulating the sales activities of a company.

As a strategic dimension of sales control, sales management audit helps organizations to assess the effectiveness of their sales strategies, policies, and procedures, and to identify gaps that may be hindering their sales growth. It involves examining various aspects of the sales function, such as sales planning, sales forecasting, sales organization, sales operations, sales training, sales compensation, and sales performance evaluation.

The audit process typically begins with the identification of key performance indicators (KPIs) for sales management, which are used to measure the success of the sales function in achieving the company's goals. These KPIs may include metrics such as sales revenue, sales growth, customer retention, market share, and sales productivity.

Once the KPIs have been established, the sales management audit involves gathering data on these metrics, analysing the data, and identifying areas where performance falls short of expectations. Based on these findings, recommendations are made for improvements to the sales management function, such as changes to sales strategies, sales processes, sales training, or sales compensation.