Page 188 - DMGT205_SALES_MANAGEMENT

Sales Management

Notes increase in market share, we add this percentage to last year sales.
Rule of Thumb: Most companies set their sales budget as a specified percentage of sales (either
current or anticipated). Mass selling goods and companies dominated by finance are major users
of this method.
Total Market Estimates: In this method of setting sales quotas total market estimates are made
by the company for that year and sales quotas are derived from this.
Zero Base Budgeting: A process in which sales budget for each year is initiated from zero base
thus justifying all expenditure and discarding all conventions and rules of thumb. Its limitation
is that it is very elaborate and time consuming process.

11.17 Review Questions

1. What do you understand by a sales budget and what is its purpose?
2. What are the methods of budgeting?

3. What are the various methods of sales control?
4. What feedback can be obtained by analysing the various sales reports sent by the salesmen?
5. What is the role of a territory manager to streamline the sales of an organisation?

6. What are the bases for forming sales territories?
7. What do you understand by ability index of a salesman? How can a manager decide the
territories according to the ability index to increase the sales. Illustrate with example.

8. Describe the model of territory management cycle with the help of a diagram.
9. What are a territory manager's problems and how a manager deals with them?
10. How do quotas motivate the salesmen? Describe the needs and importance of quotas.
11. What are the various types of sales quotas that are fixed for salesmen?
12. What do you understand by Combination quota? Why is Combination quota used?

13. Give a brief account of the administration of quota system and the limitations of sales
quota.

Answers: Self Assessment

1. Budgeting 2. financial plan

3. Mass selling 4. Marketing Mix
5. performance 6. audit
7. operational 8. True
9. True 10. False

11. False 12. True
13. (a) 14. (b)
15. (a)

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