Copyright © 2010, S L Gupta Excel Books Sales and Distribution Management Text & Cases ( 2 nd Edition) S L Gupta3-1 Sales Organisation Basics of Sales Management Ch-3 Block: I Chapter 3 Sales Organisation

Copyright © 2010, S L Gupta Excel Books Sales and Distribution Management Text & Cases ( 2 nd Edition) S L Gupta3-2 Sales Organisation Basics of Sales Management Ch-3 Block: I Introduction  Sales Organization is a department of the organization which establish for the purpose of directing, coordinating and controlling the sales organization.  A sales organization structure evolved in such a way that sales people and sales manager carry out their activity effectively and efficiently. It gives a blue print that “what activity is performed by which person”. The basic concept include are following:  Centralisation  Specialization  Staff position  Marketing orientation  Co-ordination  Control

Copyright © 2010, S L Gupta Excel Books Sales and Distribution Management Text & Cases ( 2 nd Edition) S L Gupta3-3 Sales Organisation Basics of Sales Management Ch-3 Block: I Setting up a Sales Organization There are five major steps in setting up a sales organization 1. Defining the objective 2. Delineating the necessary activities 3. Grouping activities into “jobs” or “positions” 4. Assigning personal to positions 5. Providing for coordination and control

Copyright © 2010, S L Gupta Excel Books Sales and Distribution Management Text & Cases ( 2 nd Edition) S L Gupta3-4 Sales Organisation Basics of Sales Management Ch-3 Block: I Factors determining the structure of Sales Organization 1. Price of Product 2. Nature of Product 3. Nature of Market 4. Size of the enterprise 5. Ability of the Executives 6. Sales Policies of the Enterprise 7. Distribution System 8. Finance 9. Number of Products 10. Miscellaneous

Copyright © 2010, S L Gupta Excel Books Sales and Distribution Management Text & Cases ( 2 nd Edition) S L Gupta3-5 Sales Organisation Basics of Sales Management Ch-3 Block: I Functions of Sales Organisation The functions of sales organisation can be classified as follows 1. Planning functions a. Sales forecasting b. Sales budgeting c. Selling policy 2. Administrative functions a. Selecting salesmen b. Training salesmen c. Control of salesmen d. Remuneration of salesmen 3. Executive functions a. Sales promotion b. Selling routine—execution of customers’ orders.

Copyright © 2010, S L Gupta Excel Books Sales and Distribution Management Text & Cases ( 2 nd Edition) S L Gupta3-6 Sales Organisation Basics of Sales Management Ch-3 Block: I Cont…. Role of Sales Administration  Total customer satisfaction by way of prompt and safe delivery.  Proper maintenance of stock ensuring defect free delivery to customers.  Effective coordination and communication between regional offices and dealers. FIRST CLASSIFICATIONSECOND CLASSIFICATIONTHIRD CLASSIFICATION 1.Order processing and vehicle dispatch 1.1.Domestic order processing and dispatch 1.1.1Receipt and screening of orders 1.1.2Authentication from accounts for dispatch 1.1.3Processing of orders and communication for confirmation 1.1.4Allocation of vehicles 1.1.5Collection of toolkit/mats from store

Copyright © 2010, S L Gupta Excel Books Sales and Distribution Management Text & Cases ( 2 nd Edition) S L Gupta3-7 Sales Organisation Basics of Sales Management Ch-3 Block: I Cont… Arrangement of transit insurance 1.1.7Documentation for dispatch 1.1.8Excise challan 1.1.9Physical dispatch of vehicle 1.2Export order processing and vehicle dispatch 1.2.1Receipt of export from export dept Allocation and documentation for dispatch 1.2.3Coordination with excise for bond/AR4A 1.2.4Excise clearance and physical dispatch of vehicle 2.Production coordination2.1Spy/bus activities2.1.1Movement of chassis to body builders 2.1.2Movement of body built up vehicle from body builders to Surajpur and other destinations

Copyright © 2010, S L Gupta Excel Books Sales and Distribution Management Text & Cases ( 2 nd Edition) S L Gupta3-8 Sales Organisation Basics of Sales Management Ch-3 Block: I Cont… Collection of production and data entry of production/ RGPIN 2.2Delivery of vehicle from plant/body builder to marketing 2.2.2Inspection/checking of vehicle 2.2.3Parking in yard 2.2.4Communication to H.O. marketing/export 2.2.5Intimations of daily production details to excise 3.Logistics planning3.1Movement of vehicle3.1.1Coordination with transporters 3.1.2Ensuring safe and faster delivery 3.1.3Procuring of transport bills 4.Vehicle inventory control/maintenance to stocks 4.1Inventory control4.1.1Proper control of inventory by preparing daily MIS 4.1.2Maintain manual FIFO system

Copyright © 2010, S L Gupta Excel Books Sales and Distribution Management Text & Cases ( 2 nd Edition) S L Gupta3-9 Sales Organisation Basics of Sales Management Ch-3 Block: I 4.2Maintenance of stocks4.2.1 Visual inspection 4.2.2Periodic maintenance for tyre pressure, coolant, battery oils etc. 5.RTO coordination5.1Temporary registration trade certificate 5.1.1Obtaining T/R No. and T.C Remittance of monthly T/R and road tax payment to RTO 6.Office Administration6.1Maintenance of records6.1.1Preserving of old records of LCV 6.1.2Maintenance of general files, invoice, stationery and computer stationery 6.2.1Correspondence with dealers/R.O Correspondence with sales dept Correspondence with RTO etc.

Copyright © 2010, S L Gupta Excel Books Sales and Distribution Management Text & Cases ( 2 nd Edition) S L Gupta3-10 Sales Organisation Basics of Sales Management Ch-3 Block: I Cont…. Role of Sales Organisation Once the sales plan has been formulated, the next logical step is to organise a sales force to achieve the organisational objectives. Major Qualified Sales Objectives Overall ObjectivesBreak Up or Division 1.Total volume of products1.Quarter, month and week 2.Total annual value of products2.Product line and range 3.Total annual selling costs3.Region and sales area 4.Total annual profit contribution4.Type of customer

Copyright © 2010, S L Gupta Excel Books Sales and Distribution Management Text & Cases ( 2 nd Edition) S L Gupta3-11 Sales Organisation Basics of Sales Management Ch-3 Block: I Sales Organisations: Basic Purposes 1. Define the line of authority 2. Ensure that all necessary activities are assigned and performed 3. Establish lines of communication 4. Provide for coordination and balance 5. Provide insights into avenues of advancement 6. Economics of executive time. Sales organisation also depends on the type of sales force which is used, for example, field sales force, national account management, team selling, telemarketing, part-time sales forces, direct selling, etc.

Copyright © 2010, S L Gupta Excel Books Sales and Distribution Management Text & Cases ( 2 nd Edition) S L Gupta3-12 Sales Organisation Basics of Sales Management Ch-3 Block: I Developing a Sales Organisation Sales organisation development refers to the formal, coordinating process of communication, authority and responsibility for sales groups and individuals. A sales manager must recognise and deal with some basic problems faced by organisations, when developing his own sales organisation. The five major issues are: 1. Formal and informal organisations 2. Horizontal and vertical organisations 3. Centralised and decentralised organisations 4. The line and staff components of organisations 5. The size of the company.

Copyright © 2010, S L Gupta Excel Books Sales and Distribution Management Text & Cases ( 2 nd Edition) S L Gupta3-13 Sales Organisation Basics of Sales Management Ch-3 Block: I Field Sales Organisation The following are the important field sales Organisations: 1. Geographic sales specialisation organisation 2. Product-based sales specialisation organisation 3. Customer-based specialisation organisation 4. Activity/function-based specialisation 5. Hybrid sales organisation 6. Team-based organisation.

Copyright © 2010, S L Gupta Excel Books Sales and Distribution Management Text & Cases ( 2 nd Edition) S L Gupta3-14 Sales Organisation Basics of Sales Management Ch-3 Block: I Coordination Sales personnel should be aware that there is need for a great deal of coordination in the organization. The coordination may be: 1. Formal: To group the allied activities. 2. General Administration: Where various officers discuss company related matters and find solutions. 3. Departmental: Where each department of the company attends the coordination committee meeting and a decision is taken in such meetings which is binding on all. 4. Informal Coordination: When an occasion or difficulty arises, the concerned personnel meet each other and sort out the matter.