Sales Management Zeus Co. Case Topic 15

Stop! Read the Case! Answer the Questions

Chasing Lower Costs Information = Speed of Light Logistics = Speed of a Truck or Boat Flexibility vs Lowest Cost

Independent Reps vs Salespeople Independent Reps –Advantages –Disadvantages Company Salespeople –Advantages –Disadvantages

Luck or What? Glen Whitener – What is your letter grade? Think this through carefully

Glen is at least an A- What Options Did He Have? Limited Budget Marketing Luck And Taking Advantage of Luck

Price Increase Great Job! But Moving Faster? Take Advantage of this Strategically

Fad Product or Not?

How Do You Forecast Fads? Let me know when you figure this out Cost of Over-Producing Cost of Under-Producing Which Can You Recover From?

Don’t Get Lost in Production Danger of Narrowly Focusing Production or Logisitics Sales Forecasting Profit is Our Goal – Not what is easy or convenient for an operational silo

Manufacturing Contract Options Depends on Sales Forecast Weighted Average is Still A Guess A More Math Intensive Answer Does Not Make It The Right Choice Why Dr. A Holds This Opinion

Break-Even Between Sales Forces Obvious Answer – Use Reps Logically, What is the Job? How Easy to Get Replacements?

Setting Up the Problem 3 Person Sales Force $40k salary + $15k Benefits and.005 commission Versus 12.5% Commission

Solution 3 ($65,000) +.005x =.125x X = $1,375,000 Tie to Your Sales Forecast Money On Table is Substantial For Most Other Option (unlisted in case) –Lower Commission Rate

Independent Rep Reaction Look at New College Student Look at Experienced Rep Minimize Cost is Offer Job to Reps

Management Bonus Pool How Would This Work? Consequences Are Clear What Are the Risks to Glen? How Should Glen Handle This?

What Have We Learned Today? Not All Problems Have Math Centric Solutions Sometimes You Prepare For Best Guess Choice Examine Problems From Different Viewpoints Run Costs

What Have We Learned? When Do Legal Issues Pop Up? Politics of A Legal or Ethical Dilemma Choose Well Luke!