Page 174 - DMGT205_SALES_MANAGEMENT

Sales Management

Notes 2. Full line quota
(a) Designed to secure some desired balance of sales among various products.
Administering the Quota System
1. Accurate, fair & attainable quotas

2. Depends not only on the quality of managements judgment but on the capabilities &
motivational of the sales force
3. Securing & maintaining sales personnel's acceptance of quotas

4. Participation by sales personnel in quota setting
5. Keeping sales personnel informed
6. Need for continuous managerial control.
Reasons for not using Sales Quotas

1. In certain industrial goods, its difficult to obtain accurate sales estimate
2. Since quota requires statistical technique, fear is that sales personnel will not accept quota
prepared by hard to explain techniques

3. Place too much emphasis upon making sales - legitimate criticism of sales volume quota
4. If product is in short supply, quotas are not appropriate.

11.7.1 Purpose of Sales Quotas

Sales quotas serve several purposes. The principal purposes include the following.
 Providing Goals and Incentives to Achieve a Certain Performance Level

 If performance is exceeded or surpassed more incentives are given. While setting quotas,
it must be ensured that they are specific, measurable, attainable, realistic and time bound.
(SMART).
11.7.2 Controlling Sales Person's Activities

Quotas provide opportunities:
1. To direct and control the selling activities of sales person.
2. To control the calls per day.
3. To gain new accounts.

4. To plan demonstrations.
5. For realisation of money from the account holders.
6. To take corrective actions if the salesman fails to achieve his targets.

The entire control process of setting the desired performance, measuring the actual performance,
finding out the deviation and taking corrective action is followed in its totality.

Evaluating Performance

Performance against quotas also helps in identifying strong and weak points of the sales person
and performance of qualitative and quantitative activities. The performance can be judged for

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