Page 208 - DMGT205_SALES_MANAGEMENT

Sales Management

Notes
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Caution If sales targets in rupees or volume (units), are set realistically they can be used for
performance standards but if they are not realistic they loose their meaning.

13.5 Performance Appraisal and Evaluation

Appraisal and evaluation is done continuously. The ultimate goal of any evaluation is to make
the salesman more valuable to the company.
To make evaluation effective we must make:

1. A study of the salesman himself - his skills, aptitudes and attitudes.
2. A study of his selling records - his efforts and accomplishments.
3. An analysis of the direction the development function is to take.

Evaluation is a complex task because of a variety of activities and different selling situations
which are to be compared. Different types of selling situations require different selling skills.
Salesmen differ in selling acumen due to differences in personal qualities and the territories are
also different. Evaluation requires the setting of quantitative and qualitative standards for
periodic comparison. A salesman is considered effective if the results offset the cost and contribute
to profit.
Evaluation helps in:

1. Developing salesmanship as an interpersonal influence process.
2. Motivation of salesmen and supervisory leadership.
3. Identifying the needs for continuous training and development.
4. Determining and restructuring salesmen territories and work assignments.
5. Improving selling aids like demonstration material, working documents.

6. Introducing a sound compensation and incentive system.
7. Improving sales planning, call cycles, routes and visits, job preparation.

Notes Ratio of net profit or gross profit to sales are decided upon for the sales territories.
Each sales territory is considered as an organisational unit and contributor to corporate
profit. In such a situation high margin products are emphasised at the expense of new
products or new accounts with the result that the salesman concentrates on more lucrative
accounts in their territory to reduce expenses and give no importance to new accounts.

13.6 Salesman's Valuation – Some Basic Issues

There are some basic issues involved in evaluating system of salesman.
1. Evaluation based on quantitative data can have bias and vitiate evaluation results as
certain important determinants of salesmen effectiveness (personal effectiveness of a
salesman, selling skills, persuasion ability, etc.) which are qualitative will be left out.
Therefore, a judicious mix of quantitative and qualitative criteria has to be evolved by the
managers.

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