Introduction to Sales and

Distribution Management
Session 1

31-07-2021 Dr. Priyavrat Sanyal 1

Sales
• What is Sales?
• https://www.youtube.com/watch?v=Y5UzFD-ALi4
• Why Sales in important?

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Business: The art of Selling
• Death of salesman ?
• Technologically superior firms too rely on salepeople
• Management thought: “ ..aim of marketing is to make selling
superfluous”
• Art to Science…
• Compensation structure..
• Who is Willy loman?
“Spare a thought for the world's Willy Lomans, riding on a smile and a
shoeshine”
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Evolution of Selling

Consultative
Seller
Key Account
Seller
New
Business
Sales Seller
Support
Delivery
Seller

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Evolution of Salesperson

The Modern Age

The Middle Renaissance
Ages
The Dark
Ages
The
Classical
World
The
Ancient
World

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Evolution of Sales function paradigm

Transactional Value
Paradigm Paradigm

Relationship
Paradigm

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Type of Sales function
• Outside Sales
• Inside Sales

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Different Sales Domain
• Retail / Consumer Sales
• Industrial Sales

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Responsibilities of Salesperson

Salesperson

Provide
Generate Territory Professional Company
Service to
Sales Management Development Service
Customers

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Responsibilities of a Salesperson?
• Largely responsible for implementing firm’s marketing strategies in
the field
• Represent their firms to customers and to society in general
• Provide customer information to firms
• Operate with little or no direct supervision and require a high degree
of motivation
• Face frequent rejection
• Need more tact and social intelligence than other employees on the
same level in the organization

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What Customers expect from Professional
Salesperson
• Provide service that solves problems and responds to customer needs
• Has excellent product knowledge
• Serves as an advocate for the customer within the selling firm
• Keeps customers up-to-date
• Sells a high-quality product
• Offers superior technical support
• Has accessible personnel that are available locally
• Sells a wide variety of products that offer a total solution
• Understands the customers’ business
• Sells the product for a competitive price The HR Chally Group, Ten Year Research
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Report,
11
2002
Sales Manager- Roles and responsibility
Strategic
Planning

Organizing
Performance
the Sales
evaluation
force

Communication
Coordination
Integration
Motivation Recruiting,
and Selection,
leadership assimilation

Training and
development

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Sales Manager to Team Leader
• The critical changes in the roles of a typical sales manager
• Develop a detailed understanding of customers’ business
• Treating salespeople as equal and working with them to achieve profitability
and customer satisfaction
• Applying flexible motivational tools to a hybrid sales force of telesellers, direct
marketers and field salespeople
• Have update on latest technologies affecting buyer-seller relationships
• Working closely with internal departments
• Continually seeking ways to exceed customer expectations and bring value to
the buyer-seller relationship
• Create a flexible learning and adapting environment
Chad, 2000
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Salesforce Management Challenges in 21st
Century
• Selling by executives
• Strategic account management
• Customer relationship management (CRM)
• Use of LMS by both outside and inside sales team
• Sales force diversity
• Complex channels of distribution
• An international perspective
• Ethical behavior and social responsibility

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Action time
• Assume that your company, which sells paper products, has 60
percent of the business at your largest account. What factors would
make it relatively easy for you to get a larger share of that customer’s
business, and what factors would make it harder?

• Write in less than 500 words.

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 Session 2

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Assignment & Group formation
• Deadline for assignment – 26th June 2021 EOD
• Not more than 500 words

• Not more than 8 in a group

• Submit group details to CR before 24th June 2021 EOD

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What makes a good salesman
• Turnover; 50% in first year and 80% in first three years
• https://www.linkedin.com/pulse/why-turnover-so-high-b2b-sales-anthony-chaine/
• 89% leave due to deficient compensation
• 60%-80% leave due to lack of connection with leadership or incompetence of leadership
• 75% leave because of concerns about the company ability to meet market needs

• Cost associated with turnover

• Salary, incentive, commission and other costs
• Search, recruitment and training cost
• Lost sales, drop-outs, company reputation, poor morale, territory lost cost
• So what makes a good salesman; 7 years of field research
• Two basic qualities: Empathy and Ego Drive
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Contd..
• Ability to feel: Empathy- Not sympathy
• Old anti-aircraft weapons and new heat-attracted missile

• Need to Conquer: Ego-Drive- beyond monetary benefits

• Closing the deal enhances self-ego

Ego Close
Empathy
Drive the sale

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Contd..
• Failures must act as trigger of motivation for more effort
• Balance between partially weakened and strong ego

• Synergistic Effects

High High Ego

E Empathy D Drive

Low Low Ego

e Empathy d Drive
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Contd..
• Need for Balance
• ED
• Ed
• eD
• ed
• Why you can’t select a salesperson by taking standard test
• Test have been looking for interest rather than ability
• Tests have been eminently fakable
• Test have favored group conformity, not individual creativity
• Test have tried to isolate fractional traits rather than reveal the whole
dynamics of the man

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Contd..
• Fallacy of Experience

• Background blindness

• Role of training

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 Personal Selling Process

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Personal Selling Process
• Sales lead generation
• Sales lead qualification
• Pre-approach
• Approach
• Sales Presentation
• Handling customer objections
• Closing the sale
• Follow-up action

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Comparison between Relationship selling and
transactional selling
Relational Selling Transactional Selling

Salesperson’s focus on delivering value to the Focus only on price

customer

Buyer looks for capabilities in a salesperson Buyer focuses only on the product

More effective, less efficient More efficient, less effective

Long-term orientation in selling Short term approach

Each deal / transaction is seen as a part of relationship Each deal is independent

Customer orientation Product orientation

Example: Example:

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Customer’s buying process
B2B B2C

- Need identification - Need identification

- Product specification - Generation of awareness and interest

- Evaluation of suppliers and products - Evaluation and trials

- Pilot testing and customization - Product/service adoption

- Purchase and roll-out - Post purchase review

- Post sale handover

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Mapping Buying with Selling

Consumer Buying Process Personal Selling Process

• Need identification • Sales lead qualification

• Information search • Sales presentation
- Awareness development
-Interest development
• Intention to purchase • Handling customer objections
• Purchase behavior • Closing the sale
• Post purchase behavior • Follow-up action

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 B2B /Industrial buying behavior

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Buying Centre
• Initiator
• Users
• Influencers
• Gatekeepers
• Buyer
• Decision Makers

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Understanding Firms as Customers
• Purchasing orientation of business market customers
• Buying orientation

• Procurement orientation

• Supply management orientation

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Buying Orientation
• Obtain the best deal
• Price analysis
• Cost analysis
• Maximize power over suppliers
• Commoditization
• Multi-sourcing vs sole-sourcing
• Avoiding risk
• Follow established procedure
• Rely on proven vendors

Developments in buying
- Target pricing
- Global sourcing
- E-sourcing, online reverse auctions
- Defeaturing or cooperative pricing
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Procurement Orientation
• Improving quality
• Reducing total cost of ownership (TCO)
• Cooperating with suppliers
• Standardization
• Target costing

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Supply Management Orientation
• Focus on end users
• Craft a sourcing strategy
• Build a supply network (lean)
• Sustain highly collaborative relationship with select suppliers

Value in use (VIU) and VIU price

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Selling approaches: Theoretical perspective
• AIDAS approach
• Right set of circumstances approach
• Buying formula approach
• Behavioral equation approach
• Need Satisfaction approach
• Consultative approach

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AIDAS Approach

Attention Interest Desire Action Satisfaction

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Right Set of Circumstances Approach

Circumstances

Internal Factor

Buying decision Buying behavior

External Factor

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Buying Formula Approach
Need Solution Purchase
Need Solution Purchase Satisfaction

Product
Need Purchase Satisfaction
Service/Trade Name

Adequacy Adequacy Adequacy

Product
Need Service/Trade Purchase Satisfaction
Name

31-07-2021 Pleasant
Sales feeling Pleasant
and Distribution Management by feeling
Priyavrat Sanyal 39
Behavioral Equation Approach

B=PxDxKxV

B= Response, act of buying or patronizing a supplier

P= Internal response tendency or force of habit
D= Present drive level
K= Value of the product or its potential satisfaction (to buyer)
V= Intensity of all cues, triggering and non-triggering

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Need Satisfaction Approach
• Need Identification
• Need Fulfilment
• Need Satisfaction

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Consultative Approach
• In this approach salesperson helps a prospect to solve the following
problems
• Need Problem
• Choice Problem
• Helping in deciding the choice criteria
• Product Installation
• Product-use Problem
• Product maintenance Problem
• Customer feedback Problem

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Action time
• ROLE PLAY- Understanding Buyers: Candoo Computer Corporation
• As a salesperson for Candoo Computer Corporation (CCC), you have just received a call from your regional manager regarding a program now underway at
one of your key accounts, Farmland Ltd. Farmland is a national insurance company with agency offices spread across India. The company is in the early
stages of designing and specifying a computer system that will place a computer in each agency office. The system will allow each agency to develop,
operate, and maintain its own customer database to provide better service to customers. In addition, by linking through the CCC mainframe, agencies,
regional offices, and CCC headquarters will be networked for improved internal communications and access to the corporate database.
• Current Situation
• You have serviced this account for several years, and CCC equipment accounts for the biggest share of computers now in place at Farmland—some 35 to 40
percent of all units. As reflected in your share of this account’s business, you and CCC have a good reputation and strong relationship with Farmland. In
talking with Amitava Sarkar, your usual contact in the Farmland purchasing office, you have learned that this agency network system is the brainstorm and
pet project of Alka Kakkar, a very “hands-on” CEO. Consequently, the probability of the system becoming a reality is high. While faxing a complete set of
hardware specs to you, Amitava has also let you know that, although Milind Palekar, director of the Farmland MIS department, is actually heading up this
project; the national agency sales director, Rocky Franklyn, is also very active in its design and requirement specifications. His interest stems not only from
wanting to make sure that the system will do what is needed at the corporate, regional, and agency levels but also from the fact that he brainstormed and
spearheaded a similar project two years ago that was never implemented. The previous effort did not have the blessing of Milind in the MIS department,
and it became a political football between the two departments. Each department wanted something different, and both sides accused the other of not
knowing what it was doing. Primarily, because the CEO has commanded that it will be done, both sides seem to be playing ball with each other this time.
• Amitava did hint at one concern, however; although corporate is designing and specifying the system, each agency has to purchase its units out of its own
funds. Although the agencies exclusively represent only Farmland Insurance products, each agency is owned by the general agent—not Farmland. Some of
the agents are not convinced that the system is worth the projected price tag of 2,50,000 INR per system, and Farmland cannot force them to buy the
systems.
• As with other selling opportunities with Farmland, this has all the makings of a decision that will be made because of multiple inputs from an assortment of
individuals across the company—a buying team of sorts.
• Role Play
• Characters: Yourself, salesperson for the Candoo Computer Corporation; Amitava Sarkar, purchasing manager for Farmland Companies; Milind Palekar,
director of MIS for Farmland Companies; Rocky Franklyn, national agency sales director for Farmland Companies; and Alka Kakkar, CEO for Farmland
Companies.
• Scene 1: Location—Amitava’s office at Farmland Companies. Action—You, as the Candoo Computer salesperson, are entering the first meeting with the
Farmland buying team. Your goal for this first sales call is to establish
31-07-2021
rapportSanyal
with each of the buying team members and identify the needs and
Dr. Priyavratthese 43
expectations that will determine the purchases for this project. Identifying needs and expectations is critical so that you can work with your own
technology support people and develop a customized system as a solution to Farmland’s needs.
Session 3 & 4
Personal Selling
Selling approaches: Theoretical perspective
• AIDAS approach
• Right set of circumstances approach
• Buying formula approach
• Behavioral equation approach
• Need Satisfaction approach
• Consultative approach

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AIDAS Approach

Attention Interest Desire Action Satisfaction

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Right Set of Circumstances Approach

Circumstances

Internal Factor

Buying decision Buying behavior

External Factor

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Buying Formula Approach
Need Solution Purchase
Need Solution Purchase Satisfaction

Product
Need Purchase Satisfaction
Service/Trade Name

Adequacy Adequacy Adequacy

Product
Need Service/Trade Purchase Satisfaction
Name

31-07-2021 Pleasant
Sales feeling Pleasant
and Distribution Management by feeling
Priyavrat Sanyal 49
Behavioral Equation Approach

B=PxDxKxV

B= Response, act of buying or patronizing a supplier

P= Internal response tendency or force of habit
D= Present drive level
K= Value of the product or its potential satisfaction (to buyer)
V= Intensity of all cues, triggering and non-triggering

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Need Satisfaction Approach
• Need Identification
• Need Fulfilment
• Need Satisfaction

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Consultative Approach
• In this approach salesperson helps a prospect to solve the following
problems
• Need Problem
• Choice Problem
• Helping in deciding the choice criteria
• Product Installation
• Product-use Problem
• Product maintenance Problem
• Customer feedback Problem

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Salesperson Knowledge Universe

Product
Knowledge

Salesperson’s
knowledge
universe
Company Competitor’s
Knowledge Knowledge

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Selling Process
• Prospecting :
✓ Anyone having a need or desire to acquire Identify and define
the product is a LEAD the prospects
✓ Anyone LEAD who has a current demand
for the product and can get substantial Search for sources of
benefit from it is a PROSPECT potential accounts
✓ Anyone PROSPECT who have a the ability
to purchase the product but need further Qualify the prospects
persuasion is QUALIFIED PROSPECT from the suspects

Process of Prospecting

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SPANCO Sales Funnel
a. Automobile dealership sales manager Suspect
reviews the enquiries and conversion
data for each salesperson using the
SPANCO framework. Prospect
b. With a typical suspect-to-order
conversion rate of 10%, if the
salesperson has to sell 5 cars in a
Approach
month, sales manager can estimate if
the salesperson has ample suspects and Negotiate
prospects.
c. In this case, the salesperson must have
at least 50 suspects to achieve the Close
monthly target.
Order
SPIN Selling Framework
You are selling a Sales CRM Software, so SPIN selling will help you as

Situation Problem Implication Need-Payoff

What problem do
What is your
you face in your
current method of
current method of
recording customer Do you think
recording customer Has the
data solving this
data shortcomings in
problem would
your current CRM
help you in
systems affected
How much money achieving your
your business
Why do you use do you spend in goals
this method current setup on
CRM
 Case discussion
Siebel Systems: Anatomy of a Sale

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Siebel Systems- Anatomy of a Sale – Part 1
• About Siebel Systems
• Tom Siebel; Greg Carman; Cathy Ridley

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The Situation…
Greg Carman of Siebel Cathy Ridley of Q&R

GOALS- What does each party want to accomplish

ASSETS- What does each party bring to potential

relationship
INFORMATION – What does each party give to the
other

INFORMATION – What does each party expect to

get from the other
NEXT STEPS- What would you do next in each
party’s shoes?

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Presentations

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Contd..
• What was Tom Siebel’s vision for his firm? What do you think of that
vision?

• Long-term orientation
• Wanted customers to be successful over venture funders
• Market leader position
• Wanted to make sales automation a CEO issue rather than a CIO issue
• Wanted to share value created

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Contd..
• Target Account Selling Process

• What do you think of this way of structuring the selling process?

• It is systematic
• It tells the salesperson when to collect account information and what to
collect
• It lets management monitor selling efforts- the process of converting leads to
sales
• But it is rigid and unresponsive to the personalities of a particular buying
center
• It makes relationship building a step 3 activity – should that come earlier?

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Contd.
• Does Carman use the TAS process as he starts to chase the Quick and
Reilly transaction?

• Page 5
• How should Carman respond to the invitation to tell the Quick and Reilly
executives what he thought of ORACLE? What feature of this particular
interaction influence your opinion? Would your opinion of the right response
change if the circumstances were different?
• How should Carman qualify the prospect? Should he ask, “what’s your
budget?” Should he suppress his curiosity and leave it to the prospect to bring
un information about the size and timing of the opportunity? If he asks for
information, how will he use it?
• Evaluate Carman’s interactions with the customer upto this point. Is he doing
a good job? How effective is Siebel Systems’ approach?
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 Part 2

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Contd.
• So how is Greg Carman doing ?

• Positives
• Building trust
• No hard selling
• Found the coach
• Negative
• Not following TAS
• Little knowledge about buying center and structure of client organization
• Low enthusiasm

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 Part 3

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3.1
• How should Carman establish the roles of Burt and Capodilupo in the
transaction? How should he decide who plays the most important
role?

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3.2
• At this point the account is Oracle’s to lose. It particularly does not
want to lose the Siebel Systems. How should Oracle act?

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3.3
• Where did Carman go wrong? How did he come to miss his numbers?

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3.4
• How can Carman save the Quick and Reilly transaction without
injuring the FleetBoston relationship?

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3.5
• What is your advice to Carman? Could he have anticipated the call
from the FleetBoston manager? At this stage, how important is the
FleetBoston relationship to him? What do you think of Siebel
Systems’ approach to customer satisfaction? Is it a realistic one? Is it
possible that customers can take advantage of Siebel Systems
because of its commitment to customer satisfaction?

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• How did Carman fared as a salesperson – Top sales person, Average
or Poor?

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How to sell new products: Focus on earning
not performance
• Ability to innovate but inability to commercialize
• Gap due to lack of formal processes and effective talent-management
strategies
• Difficulty in selling new products
• New Sales process
• Demands on time
• 35% more time meeting customers
• 32% more time spent in face-to-face meetings
• 30% more time meeting cross functional teams of customers

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Contd..
• Barriers to closing
• Resistance to sale in later stages of sales cycle: customers are initially interested but later
refuse to change status quo
• In sales enquiry and need recognition stage customer are uncertain and worried about
the disruption. Similar concerns are raised in the decision making stage as well
• This pattern is problematic for sales teams. Initial enthusiasm of customers drives sales
teams to put more time but as the process unfolds it become clear that many of those
meetings were never real opportunities
• The training needed
• Typical training focuses on product rather than sales process
• Sales team would be better off spending their time developing a psychological profile of
the ideal customer

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Contd..
• What makes for successful salespeople?
• Long view
• Have different concerns
• Exhibit more resolve
• Have a learning mindset
• Knowledgeable, customer focused and adaptable
• A culture that supports new product sales
• Assess skills systematically
• Train for knowledge and resilience
• Benefits of Strategic Account Management
• Big picture
• Build partnerships with clients

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Session 5
Sales Force Planning and
Sales Organization
Sales Organizations
• Entities responsible to design and execute a sales plan to achieve
business goals (sales turnover, profits, market share, customer and
channel loyalty).

• Objectives of Sales organization

• Allocate activities of the sales force based on specification of labor
• Organizational structure should have clear reporting relationships and
processes
• Effective coordination of the various activities of the sales force to bring
efficiency in the system
Factors deciding the structure of sales org.
• Type of customer in each market
• Type of sales jobs required to serve a market
• Job activities
• Design of sales jobs required to serve the customers
• https://www.youtube.com/watch?v=QoVM-JN1Ty0
Type of Sales organizations
• Functional type
• Geographic type
• Customer type
• Product type
Functional Type
National Sales
Manager - Sales activities are divided among
salespeople based on their
Field Sales Telemarketing
Manager Sales Manager abilities, skills and competencies.
- Territory development vs
Regional Sales District Sales territory service
Manager Manager

District Sales
Salespeople
Manager

Salespeople
Geographic type
National Sales - Salesforce divided into geographic
Manager
territory.
Regional Regional
- One of the most common form of
Manager - EAST Manager- North sales org
- Cost effective
Zone Sales Zone Sales
Manager Manager - Ignore specialization

District Sales District Sales

Manager Manager

Salespeople Salespeople

Sales Training
Manager
Customer type
National Sales - Helps in planning selling strategy
Manager based on customer buying behavior
- Helps in creating domain expert sales
Senior Manager Senior Manager people
B2B Sales B2C Sales
- Issues regarding dotted line reporting
Sales Manager Sales Manager
can crop up
Zone Sales
B2B Government B2B Private
Manager
Sector Sector

District Sales District Sales District Sales

Manager Manager Manager

Salespeople
Product Type

- Separate sales force for

separate product category
- Specialization by
salespeople
- May lead to duplication
Guiding principles for a Sales Organization
• Span of Control
• Unity of Command
• Centralization and Decentralization
• Coordination and integration
• Specialization
A Note on Sizing the Sales Force
• Feet on the street equal market share

• Factors which cause increase in sales force

• External: Customer base, competitor, business environment
• Internal: New product, new market, new selling process, market share

• Factors which cause decrease in sales force

• External: change in buying process, shrinking markets, consolidation among
buyers
• Internal: M&A, change in marketing strategy, productivity perspective
Contd.
• Sizing Methodologies
• Activity based method
• Target return per call method
• Sales response method
• Geographical concentration method
Activity Based Method

How many • Segments

customers would
the company target • Geographies

What sales • Pre-sales

activities would be • Calling
required to target • Post calling activities
those customers • Post Sales activities

Number of • Time required for each activity

Salespeople • Total Time per customer
required • Total time for the TG
Target Return Per Call Method
• WACC - ROI
Target Return Per Call Method - Example
Sales Response Method
• Plotting Sales force vs sales (historical data) graph to estimate
Geographic Concentration Method
• Travel time vs Revenue Potential
• Optimizing non-selling activities to increase productivity
Comparison
Method Pros Cons
Activity Based Easy and cheap Can be easily manipulated
Can arrive at solution quickly Does not link sales force size with
Good for salesforce where result it only links the effort
activities are well defined
Target return per call Links for financial performance Does not provide multiple
Simple analysis scenario analysis
Easy to implement
Useful to indicate the affordable
range of customer coverage
Sales Response Links sales efforts to results Requires detailed sales and
Good where sales force is primary activity data
creator of sales Complex analysis
Difficult and expensive to
implement
Geographic concentration Good for companies with large Require extensive data and
area analysis
Helps sales force reduce its travel Need a combination of numbers
time and cost and logic
Contd.
• Then which method to use?
• Customer validation test
• Sales force morale test
• Selling activities test

• Common pitfalls in sizing sales force

• Keeping the same sales force as last year
• Pay as you go strategy
• Size of sales force as a % of sales
• Allocation of salespeople for new products
Managing Sales Information
• Flow of information – Horizontal and Vertical
• Forecasting Market Demand
• Market Demand Function
• Breakdown approach
• Build-up approach
• Sales Forecasting Methods
• Qualitative method
• Expert opinion
• Buyer expectation survey
• Quantitative method
• Test marketing
• Time Series
• Trend methods
Case: Happy Haveli Fans Limited
 DEMAND PER DAY
180000

160000

140000

120000

100000

80000

60000

40000

20000

0
FEB MARCH APRIL MAY JUNE JULY AUGUST SEPT OCT NOV DEC
Session 6
Sales Territory Allocation
• Sales Territory is defined as a group of present and potential customers assigned
to an individual salesperson, a group of salesperson, a branch, a dealer, a
distributor or a marketing organization at a given period of time.

Advantages :
- Better coverage,
- Effective utilization of sales force,
- Efficient distribution of workload

Disadvantages:
- Not suitable for technologically superior products
- Not suitable for service based firms
• https://www.youtube.com/watch?v=Kk8gskUoQ7Q
Case Study: Realigning Sales Territories at
Garrick Oil and Lubricants
• GOAL, HQ in Paris, presence in 60 countries
• Activity involved in: exploration, production, refining, distribution and
marketing
• Products: Power generation, petrochemicals, Trading
• 700+ Franchisee outlets in Canada, 46 company owned stations
• Format: Gasoline station + convenience store
• Structure : 11 regions: each region into smaller sales territories
Contd..
• Problem:
• Since 2009, sales in
Ontario North began
slipping.
• Franchisee
complaining about lack
of service
• Rob Doff realigned
territories
Contd..
• Identified complacency as the reason and shifted people across.
• Plan backfired, 2 of the 4 salespeople quit and Rob was asked to leave.
• Current situation when Wiley joined
• Tom : 20+yrs exp, No formal degree, ThuderBay area, good performer, critical,
performance beginning to slip
• Melissa : 16+ yrs exp, Formal degree, Sault Ste area, slow initial start but
picking up lately, friendly and knowledgable
• Jim : 7+ yrs exp, highly qualified, achiever, positive, ready to take challenges
• Ben : 1 yr exp, fresh from college, good performer, worked in own territory and
also assisted Tom
Contd..
• Wiley has to decide the allocation of
territories and to do that there are
two questions which needs to be
answered
• How would you assess the profile of
each sales person
• How should Wiley allocate territories to
the four TSMs? Why?
1- Assessment of profile of each Salesperson
• Tom
• Liability
• Needs to be fixed
• How has Tom performed in last 5 years?
• Ben
• Young
• Energetic
• How stable has Ben been in his career so far?
• Melissa
• Experienced
• Loyal
• Let’s look at Melissa’s performance in detail.
• Jim
• Star performer
• Qualified
• Given the limited information, can we really classify Jim as a star performer?
Salesperson career stages
Exploration Establishment Maintenance Disengagement

Career concerns Finding an appropriate Successfully establishing a Holding on what has been Completing one’s career
occupational field career in a certain achieved; reassessing
occupation career, with possible
redirection

Developmental tasks Learning the skills Using skills to produce Developing broader view Establishing a strong self
required to do the job. results, working with of work and org., identity outside of work,
Contributor to the org. autonomy, innovativeness maintaining high maintaining acceptable
and creativity performance level perf. Level

Personal challenges Establish a good initial Producing superior results Maintaining motivations Acceptance of career
professional self-concept on the job, balancing and productivity despite accomplishments,
conflicts between career changing rewards, adjusting self-image
ad family

Psychological needs Support, peer acceptance, Achievement, self- Reduced competitiveness, Detachment from
challenging position esteem, autonomy, security, helping younger organization
competition peers
2- How should Wiley allocate territories?
• Please go to assignments and answer – time allocated 30 minutes.
Proposed Solution
• Best TSMs in best territories, or worst territories?
• New TSMs or old (demotivated) TSMs in easy territories?
• Geographical allocation
• Products: Gasoline and Lubricants
• Gasoline distribution – Company owned fleet
• Lubricant distribution – Centralized by Empire Oil from Thunder Bay
• Who is best suited for a complex distribution?
• Who can take Wiley’s position in his absence and what will happen to
that territory?
 Session 7

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• https://www.youtube.com/watch?v=edZpR_Qd8rk

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Salesforce Recruitment
• How to hire a good
salesperson?

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Salesforce Recruitment
• Personality types matching to job
profiles
• One of the measures that the
organization looks in an
employee is the ability to
perform
Performance = ability x motivation

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 - Big five personality traits: Emotional
Stability (neuroticism), work drive
(conscientiousness), teamwork
(agreeableness)
- Added Customer Service Orientation and
Optimism
- Job and career satisfaction as dependent
variable

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Does only personality matters?

Personality

Sales Performance
(Interactionism)

Organizational
characteristics

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31-07-2021 Sales and Distribution Management 117
Salesforce Recruitment
• Planning for Recruitment • Salesforce Recruitment
• Strategic Position Analysis • Internal and External sources
N = S/P (1 + T)
• Turnover
• Job Analysis • Selection of a Salesperson
• Task Inventory Analysis • Application form
• Critical Incident Analysis • Personal Interview
• Job qualification and Job • Psychological Tests
description • Big 5 (Extraversion,
conscientiousness, emotional
stability)

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 Salesforce Recruitment
• Socialization
• Process by which
an individual
appreciates org.
value system
• Ability to sell
idea both at field
and in org

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Situation
• Sandeep was a star salesman in a company selling lubricants in B2C
segment. He showed exemplary performance for three years in a row
and then in the next performance appraisal, he told his boss that he
was bored of B2C selling and wanted more challenges in his job.
Sandeep was offered B2B sales the next year that he gladly accepted.
However, one year later he is unhappy and is not able to show a
similar exemplary performance in B2B sales as in the B2C that gave
him a star recognition in the company.
• What went wrong with Sandeep’s performance and what would you do to
retain him?

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Salesforce Training

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Salesforce Motivation
• Salesperson progress stages
• Exploration stage – Support, peer acceptance and challenging positions –
Establish good professional self concept
• Establishment stage – Achievement, autonomy, esteem, competition –
Perform to get promoted, balance family and career
• Maintenance stage – Reduced competitiveness, security, helping younger
colleagues – Concerns over maintaining productivity and motivation
• Disengagement stage – Detachment from org. and organizational life –
Accepting career accomplishments, adjusting self image

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Salesforce Motivation
• Theories of motivation
• Sales force motivation model
Motivation Efforts Performance Rewards Satisfaction

Churchill, Ford and Walker Model of Sales Force Motivation

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Contd.
• Need Hierarchy Theory
• Psychological needs
• Safety needs
• Social needs
• Esteem needs
• Self-actualization

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Contd.
• Vroom’s Expectancy Theory
• Expectancy
• Rewards
• Valance

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Contd.
• Herzberg’s two factor theory
• Hygiene factors reduces
dissatisfaction and motivators
increase satisfaction

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Contd.
• Alderfer’s ERG Theory
• Hierarchy exist at three levels
• Satisfaction or dissatisfaction
either takes individual to the
next level or regresses to
previous level

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Contd.
• McGregor’s Theory of X and Y
• Theory X assumes people like to be
directed
• Theory Y assumes work is like a play
if the working conditions are
favorable

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Contd.
• Z Theory (William Ouchi)
• Blends modern western
management approach to
Japanese management
techniques
• Long-term employment, high
morale, lateral job movement,
multi-level participation in
decision making helps in
enhancing employee loyalty
towards the org.

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Contd.
• Equity Theory (Adam’s)
• Motivation of salesperson is
influenced if they feel that
they are treated fairly
• Individuals compare their
outputs (salary, benefits,
recognition, achievement) to
their inputs (commitment,
loyalty, hard work, trust)

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Contd.
• Reinforcement Theory
• How rewards and punishment
influence levels of motivation
• Positive reinforcements
increase the probability of
desirable behavior while
negative reinforcement
decrease the probability of
undesirable behavior

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Case: Prabhar Oil Company
• Reasons behind Alok’s less than expected performance

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Salesforce Compensation
• Fixed
• Commission based
• Fixed + Incentive

• Factors
• Sales volume
• Profitability
• Customer acquisition
• Customer retention

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 Session 8

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 Salesforce productivity and
performance

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Activities of a Salesperson
• Selling
• Working with distributors/retailers
• Attend meetings
• Service products
• Working with orders
• Servicing accounts
• Travel
• Communication
• Training and recruitment

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Evaluation parameters
• Objective indicators
• Subjective tasks

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Factors Determining a Salesperson’s
Performance
• Job/role variables
Decreasing
• Skill order of
• Motivation association
with sales
• Personal performance

• Aptitude
• Organizational/Environmental

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Procedure for Evaluation of Salespeople
Set Discuss
Establish performance results with
basic policies standards salespeople

Select Compare
evaluation performances
bases to standards

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Measurable bases for Evaluation
• Output measures • Input measures
• Sales Volume • Quantitative measures
• Call rate
• Sales Volume as percentage
• Workload
• Gross Margin • Selling time vs non-selling time
• Accounts • Direct selling expenses
• Non-selling activities
• Qualitative measures
• Personal efforts of sales rep
• Knowledge
• Customer relations
• Personal appearance and health
• Personality and attitude

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Scales to measure salesperson performance
• SOCO Scale
• Customer orientation
• Salespeople’s performance orientation

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Fail fast, sell well: The contingent impact of failing
fast on salesperson performance
Scott B Friend, Kumar Rakesh Ranjan, Jeff S Johnson
Publication date: 2019/10/1
Journal: Industrial Marketing Management

As such a mentality is absorbed into senior leadership approaches, sales managers

could design a culture that demands accountability when measuring sales
performance while also allowing for the freedom to fail.

Research notes that certain leadership styles may pair well with helping
salespeople learn from their failures. For example, error management leadership
style (Keith & Frese, 2008) drives the aforementioned feedback system because
managers teach salespeople how errors occurring in their prospect interactions can
actually be positive (Boichuk et al., 2014).

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Case: Sales Performance Management in KRC
• Ronit Roy
• RD- Ramandeep Singh
• Y.K. Chadda
• Balwant Singh

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Contd..
• How would you evaluate RD’s performance? Quantitative and
Qualitative justification
• Is RD loyal to KRC? Should there be a different policy for loyal
employees?
• What would be the impact of this decision of Ronit on the different
branches across the region?
• What would you do in case you take over in place of RD?

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• As a RM, what alternatives you would consider if you were to
decide on RD’s future in KRC. Give reasons to select the best
alternative.

• Not more than 400 words

• Time: 15 minutes

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31-07-2021 Sales and Distribution Management 147
31-07-2021 Sales and Distribution Management 148
Session 9
Simulation on Territory Allocation and
Management
Guest Speaker
Mr. Arun Banerjee
CEO Levensloop
Nilgai Foods
• Nilgai Foods, Kolkata, Paritosh, Rapido
 Salesforce productivity and
performance

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Activities of a Salesperson
• Selling
• Working with distributors/retailers
• Attend meetings
• Service products
• Working with orders
• Servicing accounts
• Travel
• Communication
• Training and recruitment

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Evaluation parameters
• Objective indicators
• Subjective tasks

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Factors Determining a Salesperson’s
Performance
• Job/role variables
Decreasing
• Skill order of
• Motivation association
with sales
• Personal performance

• Aptitude
• Organizational/Environmental

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Procedure for Evaluation of Salespeople
Set Discuss
Establish performance results with
basic policies standards salespeople

Select Compare
evaluation performances
bases to standards

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Measurable bases for Evaluation
• Output measures • Input measures
• Sales Volume • Quantitative measures
• Call rate
• Sales Volume as percentage
• Workload
• Gross Margin • Selling time vs non-selling time
• Accounts • Direct selling expenses
• Non-selling activities
• Qualitative measures
• Personal efforts of sales rep
• Knowledge
• Customer relations
• Personal appearance and health
• Personality and attitude

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Scales to measure salesperson performance
• SOCO Scale
• Customer orientation
• Salespeople’s performance orientation

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Channel Strategy and Design
Designing Channels of Distribution
• Channels
• Facilitate flow of product, information and finance
• Are source of strategic and competitive advantage
• Employs large workforce
• Agent, merchants and facilitators
Channel structure

• Directness
• Levels
• Density
• Variety
• Novelty
Cost And Control Aspects Of Intermediation

Control Cost Efficiency

Direct Distribution Indirect Distribution

Role of Channel Partners in a Distribution
Channel
• Carrying and forwarding agents (C&F Agents)
• Receive goods from plants and transport to distributors
• Warehousing
• Receiving dispatch orders from principal
• Arrange dispatch of goods
• Maintain record of receipt and dispatch
• Get lowest margin in the chain around 2% - 5%
Role of Channel Partners in a Distribution
Channel
• Distributors
• Purchase products in large quantities (economies of scale)
• Take ownership of product
• Distribute to retailers
• Share risk
• Earn around 8 – 10%
• Supply to MT, DC and Alternate Channels
Role of Channel Partners in a Distribution
Channel
• Wholesaler
• Service retailers
• Sells fast moving products only
• Typically located in the wholesale market area of the city
• Works on larger volume lower margins
Role of Channel Partners in a Distribution
Channel
• Retailers
• Sells to product to end consumer
• Stocks product only as per demand and requirement
• Earns the maximum margin 15% - 30%
• FMCG classification of retailer
• MT Stores
• General Stores
• Kirana Stores
• Convenience store (Paan Shop)
• Chemist Store
• Cosmetic Store
https://www.youtube.com/watch?v=GN2HAA8kfxM
Trade Merchandising
• Product and promotion placement
• Based on type of products
• Convenience
• Impulse
• Shopping
• Specialty
Channel Evaluation
• Effectiveness
• Efficiency
• Adaptability
Example
• LG Washing Machine
• Avg Purchase price (per machine)= 10K
• Margin per machine=15%
• Monthly overhead=50K

Efficiency?

If the channel wants to earn 50K, what is the optimum number the dealer
should sell every month?
Distribution Challenges and Workable
Solutions
• Distribution Reach
• Rural Affluence
• Channel profitability
• Salesforce attrition and effectiveness
Contd..
• ACER
• Madura Coats
• Nielsen
• Academic viewpoint
Session 10
Channel Conflict
Managing Channel Profitability
Channel Economics