Professional Documents
Culture Documents
U 415
U 415
targets and then define a set of steps that will be taken and the strategies that will be
used to meet those targets.
Describing in detail, sales planning skills refer to the evaluation of current performance
or sales of a given product in a particular target market, defining the sales target,
identifying the strategies for achieving that target, and identifying the resources
available for the achievement of the stated sales target.
Sometimes, these skills may also encompass the ability to assign roles and
responsibilities to different sales representatives.
Sales planning is important because it helps your foresee potential risks so that you can
try and mitigate them beforehand. It not only helps you formulate a battle plan but also
puts you in control by helping you determine your product’s current status, where you
want to take it, and how you will take there.
Sales planning also play an important role when a product is being offered in a variety
of markets. It helps you devise strategies according to the culture, needs, and
requirements of each consumer market.
Integrate your sales planning with finance and operations. One of the best ways to
improve your sales planning skills and achieve optimal accuracy in the process is to
integrate the sales data with that of finance and operations. This will not only help the
sales forecasting and budget planning to be done alongside one another but also, to
some extent, it will guide the overall operations of the business including production.
Come up with an exhaustive list of all barriers to success. List down any obstacle
that you see in the path of achieving your set targets in order to know what exactly you
are up against. Whether it is a competitor becoming an industry leader or a new target
market that has varying needs or culture than the rest, you should know what exactly
you are going to have to deal with. This can prove to be extremely inspiring, sparking
new and creative ideas for the kind of strategies you may use to overcome them.
Involve yourself in e-marketing. Whether you are trying to assess the current position
of your product/brand or executing your plan for achieving sales targets, remember that
in this era of internet all useful information is found on the web and one of the most
effective mediums that allow you to pitch is again, the web
Strategic Component One: Target Markets and Customer Segmentation
A first course of action is to identify those groups of customers that are of the most value to the
business. These are the groups that predictably buy more and at better prices (higher margins).
They love working with you and you love working with them. Knowing exactly who these ideal
customer groups are can help drive selling costs down and enable your company to focus its
product and service development efforts where the results will be greater.
We know the type of company we want to target but now we need to identify the decision maker
within that company. Start by identifying those individuals that make the purchase decision or
are likely to influence a purchase decision by function within the organization. This includes the
four key buying-influence roles: (1) economic, (2) technical, (3) user, and (4) coach. A strategy
that identifies these individuals allows you to cover your bases by interacting with these four
buying influencers to increase the probability of not only making a sale and making the sale at
higher margins.
How will you take your products or services to market? Should the channel strategy be direct,
indirect, or digital? Channel strategy drives selling costs down, drives revenues up, and
potentially extends the market reach of a company. A company must determine the sales
channels that can reach its target markets and customers most effectively. Some of the factors to
weigh:
In simple terms, a sales process is a systematic approach (a repeatable process) involving a series
of steps that enables a sales force to close well and boost revenues. There are many reasons why
having a documented and implemented process is important. Process increases lead conversion
rates, shortens the sales cycle, increases the average dollar sale, improves profit margins,
increases the productivity of the sales force, and drives selling costs down. It also allows you to
handle growth with ease and consistency. As you grow and bring on new people, it is so much
easier to train new salespeople and get them into the field faster to start bringing in new sales.
They know the process that works best and can be measured on how well they deliver on the
consistent process.
Your sales message is the unique value statement that your sales force delivers to target
customers. This message is what sets your company apart from your competition. The message
should be simple, presented from your customer’s point of-view, memorable, and differentiating.
It should explain what you do, how that benefits the customer, and why you are the best option
for their needs. Effectively communicating your company’s uniqueness or value increases
conversion rates, shortens the sales cycle, eliminates the competition, increases the average
dollar sale, improves profit margins, and increases the productivity of your sales team.
Like any good investment portfolio, a business needs to diversify its sales growth investments.
The five ways that any business can increase its revenues and gross profits are to:
Performance metrics are the quantitative and qualitative measurements a business uses to
measure the success or failure of its sales operations. These metrics should include both results-
and activity-based measurements. What gets measured gets done, as the old adage goes.
Performance metrics ensure that a business is using its sales resources efficiently to drive selling
costs down and revenues up.
Proper sales compensation ensures that a business can recruit and retain the most qualified sales
talent as well as drive the desired sales behavior expected from members of the sales team. Five
methods should be considered when a business decides how it will financially compensate the
members of the sales team for their role in generating sales:
Salary only
Commission only
Salary plus commission
Salary plus bonus
Spiffs
To do this right requires an assessment by an accomplished sales leader due to the number of
variables involved. Done incorrectly, there will be unintended consequences.
To find out how to create and implement a sales strategy that ensures smooth selling at your
company, check out my book.
Smooth Selling Forever enables small and mid-size business leaders to generate significant,
predictable, and sustainable sales growth. Based in the science of selling, when applied correctly
and managed vigilantly, smooth selling produces revenue results in a systematic fashion.
Sales quota: This critical element of your plan sets the tempo of your efforts throughout
the year and provides quarterly, monthly, weekly and even daily sub-goals for you to
achieve.
Sales territory: Refers to the geographic area, list of named accounts or specific market
niche you have been assigned to in which you are to sell your products, services and
solutions.
Strategies: The plan necessary to accomplish your goal.
Tactics: The steps necessary to carry out the plan.
Include the following four strategies in your sales plan. Remember, these strategies are all
designed to capture new customers and new market share. Important note: The strategies are
numbered and the tactics are italicized.
1. Exceed my quota.
Important note: Your numbers will, of course, vary. What's important here is that you calculate
exactly how many contacts you'll need to make in order to achieve your sales quota.
Join and participate in no less than three professional associations and organizations
that my best prospects and customers belong to.
Attend any and all trade shows and conventions that my best prospects and customers
attend.
Purchase the mailing list of these associations and organizations and send either a
postcard or a letter of introduction.
On a regular basis, contribute articles and white papers that address the interests and
concerns of this population.
Within 30 days of delivering my product, service or solution, I will ask each of my new
customers for at least three names and phone numbers of someone they personally
know who may have a use for my products, services and solutions.
Supply and demand for the products can easily be adjusted, by overcoming temporary
demand, in the light of the anticipated estimate; and regular supply is facilitated.
A good inventory control is advantageously benefited by avoiding the weakness of
understocking and overstocking.
Allocation and reallocation of sales territories are facilitated.
It is a forward planner as all other requirements of raw materials, labor, plant layout,
financial needs, warehousing, transport facility etc., depend in accordance with the sales
volume expected in advance.
Sales opportunities are searched out on the basis of forecast; mid thus discovery of selling
success is made.
It is a gear, by which all other activities are controlled as a basis of forecasting.
Advertisement programmes are beneficially adjusted with full advantage to the firm.
It is an indicator to the department of finance as to how much and when finance is
needed; it helps to overcome difficult situations.
It is a measuring rod by which the efficiency of the sales personnel or the sales
department, as a whole, can be measured.
Sales personnel and sales quotas are also regularized-increasing or decreasing-by
knowing the sales volume, in advance.
It regularizes productions through the vision of sales forecast and avoids overtime at high
premium rates. It also reduces idle time in manufacturing.
As is the sales forecast, so is the progress of the firm. The master plan or budget of a firm
is based on forecasts. “The act of forecasting is of great benefit to all who take part in the
process and is the best means of ensuring adaptability to changing circumstances. The
collaboration of all concerned leads to a unified front, an understanding of the reasons for
decisions, and a broadened outlook.”
Sales forecast enables all the departments of the business to work together in proper
coordination and cooperation.
Sales forecast helps in product mix decisions as well. It enables the business to decide
whether to add a new product to its product line or to drop an unsuccessful one.
The sales forecast is a commitment on the part of the sales department and it must be
achieved during the given period, and.
It helps in guiding marketing, production and other business activities for achieving these
targets.
Sales are the lifeblood of every company. The advantages of forecasting your company’s sales
lie mainly in giving you a firm idea of what to expect in the coming months. A standard sales
forecast looks at conditions present in your business during previous months and then applies
assumptions regarding customer acquisition, the economy and your product and service
offerings. Forecasting sales identify weaknesses and strengths before you set your budget and
marketing plans for the next year, allowing you to optimize your purchasing and expansion
plans.
Cash Flow.
Purchasing.
Planning, and.
Tracking.
In certain cases forecast may become inaccurate. The failure may be due to the following
factors:
Fashion:
Changes are throughout. Present style may change any time. It is difficult to say as to when a
new fashion will be adopted by the consumers and how long it will be accepted by the buyers. If
our product is similar to fashion and is popular, we are able to have the best result; and if our
products are not in accordance with the fashion, then sales will be affected.
A sales history or past records are essential for a sound forecast plan. If the past data are not
available, then the forecast is made on guess-work, without a base. Mainly a new product has no
sales history and forecast made on guess may be a failure.
Psychological Factors:
Consumer’s attitude may change at any time. The forecaster may not be able to predict exactly
the behavior of consumers. Certain market environments are quick in action. Even rumors can
affect market variables. For instance, when we use a particular brand of soap, it may generate
itching feeling on a few people and if the news spread among the public, sales will be seriously
affected.
Other Reasons:
It is possible that the growth may not remain uniform. It may decline or be stationary. The
economic condition of a country may not be favorable to the business activities-policies of the
government, the imposition of controls etc. It may affect the sales.
The tastes and preferences of the buyers do not remain constant. A sudden change in the
preference of the buyers may render the forecasts meaningless.
The economic conditions prevailing in every country also do not remain stable. The
purchasing power of money, desire to save and invest etc., are some of the important
economic factors having a bearing on sales forecast.
The political conditions in a State also influence sales forecast. The policies of the
Government regarding business change often. A sudden hike in excise duty or sales tax
by the Government may affect sales.
The entry of competitors may also affect sales. A firm enjoying monopoly status may
lose such a position if the buyers find the competitors’ products more superior.
Progress in science and technology may render the present technology obsolete. As a
result, products which are right now enjoying a good market may lose the market and the
demand for products made using the latest technology will increase. This is particularly
true in the case of the market for electronic goods, computer hardware, software and so
on.
The methods of forecasting discussed above have respective merits and demerits. No single
method may be suitable. Therefore, a combination method is suitable and may give a good result.
The forecaster must be cautious while drawing decisions on sales forecast. Periodical review and
revision of sales forecast may be done, in the light of performance. A method which is quick,
less costly and more accurate may be adopted.
Field sales reps are especially effective with these long-term accounts, since they can visit
customers on a recurring basis to perform maintenance, place replenishment orders, or take any
other initiative necessary to keep the client happy and maximize profitability.
Sales include “operations and activities involved in promoting and selling goods or
services.”
These statements highlight two aspects of the sales and marketing relationship:
In practice, the marketing department tends to bear responsibility for raising awareness
about a product and generating high-quality leads for a sales team. A “marketing-
qualified lead” is a lead that meets certain criteria set forth by a marketing department.
A “sales-qualified lead” adds to the initial stipulations set forth by marketing to help find
the highest value prospects.
At times, a sales department may complain that marketing leads do not meet the
standard set forth by the sales team. However, the potential for conflict also represents
an opportunity for collaboration. The more effectively the two teams can share ideas,
the better aligned their definitions are likely to be.
Sales field definition
A key objective for sales representatives is to achieve the revenue targets set by sales
managers. Managers set individual monthly and quarterly targets within an overall
revenue objective. They may set targets by individual customer or product group if they
wish to focus resources on particular areas of the business. Representatives must
develop plans for achieving revenue targets. They may try to conclude deals that are
already under negotiation or they may identify new sales opportunities with existing
customers or new prospects.
Margins
Sales representatives must also build good working relationships with colleagues inside
their own company. By working closely with sales administration, manufacturing,
distribution and customer service departments, representatives can ensure that the
company understands customers’ requirements and provides an efficient, high-quality
service.
Competition
To secure long-term business, sales representatives must protect their accounts against
competitors. They must maintain awareness of competitors’ activities, product offers
and pricing strategies. By understanding competitors, they are in a strong position to
deal with customers that are considering a change of supplier.
New Business
Transport facilities:
The marketing of a particular product depends to a large extent, on the availability of
transport facilities in the region. If the transport facilities like roadways, railways,
airways, etc. are satisfactory in the region, then the sales territories allotted to the
salesman can be large.
However, sales fields having poor transport facilities should be divided into very small
sales territories. In case the company has provisions for providing vehicles for its sales
force, larger territories can be assigned as transport bottleneck is avoided.
On the other hand, limited competition or near monopoly situation lengthens the
frequency of contacts between the salesman and the dealer and customer. In such
situations, the salesman can be assigned larger sales territories.
Population:
The density of population in a particular area also determines the size of its sales
territories. In case the company sells through middle men like wholesalers, dealers,
retailers etc., larger sales territories can be allocated to the sales force. On the other
hand, if the product is sold directly to the consumers or if a very few middlemen are
used, small sales territories can be assigned to salesmen.
A salesman is expected to create maximum sales turnover from his area with the
minimum amount of time and effort. The commonly used divisions are states, districts,
cities and trading areas.
Allocation of sales territories to a salesman is one of the important duties of the sales
manager. The allocation of sales territories must be given serious thought by the sales
manager as it is one of the important tools of control. It does not pose a problem for the
small-organization because their market is limited.
However, for big organizations having nation-wide coverage, it poses a big challenge to
the sales management.
The best way to start a sales territory plan is to first look at your customers, leads, and prospects.
Ask yourself, “Who are the top customers, prospects, and leads?” Categorize your customers into
three groups.
1. The first group should be your best customers, or the ones who require little
effort.
2. This is followed by the second group of customers: the ones who require a bit
more work, but only those you are confident have potential revenue gain that
justifies the extra work required by sales reps.
3. The third group should be customers who require a lot of work.
With these groups formed, you can decide how to best use your resources.
To discover what key trends are in your geography or market, look over the sales data that’s
already been collected. Analyze the data to find which territories show signs of growth and then
assign them to the sales reps who would be most successful based on their strengths .
Consumer Behavior supports customer belief for performance, determines product
features, formulates pricing policy and appreciates new product decision.
A child growing up in the United States is exposed to the following values- achievement
and success, activity, efficiency and practicality, progress, material comfort,
individualism, freedom, external comfort, humanitarianism and youthfulness.
Factor # 2. Sub-Culture:
Each culture comprises of smaller sub-cultures that gives more specific identification
and socialisation for their members. Sub-cultures have nationalities, religions, racial
groups, and geographic regions. Many sub-cultures make up significant market
segments, and marketers often design products and marketing programs tailored to
their needs.
Social classes are relatively homogenous and enduring divisions in a society, which are
hierarchically ordered and whose members share same values, interests, and behaviour.