Page 143 - DMGT205_SALES_MANAGEMENT

Unit 9: Motivating and Compensating Sales Personal

Fringe benefits are now an important part of every sales persons income. These are dealt as Notes
under:
1. Company Benefits: These constitute 25 to 40 % of the basic pay. Fringe benefits differ from
company to company. Insurance, paid vacation, paid leaves, retirement plans and
educational assistance are a part of company benefits.

2. Insurance: Life insurance, health insurance, accident and disability insurance are provided
by most companies. Sometimes a part of insurance is paid by the salesman. Dental and
vision care are also popular benefits introduced by many companies.
3. Paid Vacations: These are provided to sales persons with a long standing, who have
served the company for a long period of time.

4. Paid Leaves: Includes, sick leave, maternity leave and are enjoyed by confirmed salesman
who have worked for a considerable period of time.
5. Retirement Plans: Many companies contribute to pension plan for its employees. The
sales person also contribute a part of their income through payroll deductions.
6. Educational assistance: Many sales persons take advantage of company sponsored
educational programmes. They sponsor candidates to courses useful to the company.
Employers also grant release time to employees to attend courses.
7. Sales Force Benefits: Personal use of a company car and membership to clubs/ associations
is also provided to sales people. This helps them to get in touch with a lot of people
connected with business so that the sales could be increased.

Besides these fringe benefits there can be other types of incentives.
(a) Profit Sharing: If the company's profit rises then a cash bonus can be given.
(b) Stock Purchase Plan: Employees can buy shares of the company at a discounted price.
They can become shareholders of the company. This increases the loyalty of the sales
people towards the company.
(c) Credit Union: A company supported credit union to save and borrow as and when desired.

(d) Employee Services: These include subsidised meals, recreational facilities, discount on
company's products, etc.
(e) Cafeteria Approach: In this the employees choose the desired benefits. This is a new
approach in which there is a basket of benefits and the employee opts for some of these
which are more beneficial to him.

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Case Study ABC Company

BC Company was a producer of several kinds of industrial equipment listed in
exhibit. It developed from the efforts, in the late 1940s, of a gifted engineer and
Ainventor, Srirang Pandey, who patented several of his ideas for variations on
standard products. He founded and was active in the firm for more than twenty-six years
until his death.
Pandey had been very interested in the selling activity of his company and had a strong
sense of professionalism that he used in personally selecting people for his sales force. He
Contd...

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