Page 59 - DMGT205_SALES_MANAGEMENT

Unit 4: Sales Strategy Formulation

Each company deals with a unique set of marketing factors, such as the strengths and weaknesses Notes
of its products (what it sells), the motivations and buying practices of its customers and prospects
(whom to sell to), its pricing strategy and the competitive setting - the relative strengths and
weaknesses of competitors. Also, different selling jobs require different levels of selling and
non-selling abilities, training, technical and other knowledge.
Therefore, in determining the kind of sales personnel, we must understand what is expected of
them: the job objectives, the duties and responsibilities and the performance measures. Knowing
the sales person's job means knowing the particular job for the particular sales person. Knowing
the particular job helps management to avoid "putting square pegs into round holes". It helps in
fitting the job to the person and the person to the job.

Self Assessment

State whether True or False:
6. Sales Potential Basis is splitting the company's customer base according to dispersion of
its sales potential.
7. Vertical Integration is the process of requiring management membership rights at various
levels of distribution channel.
8. Manufacturing cost is the cost of transacting business.
9. Work Load Method assumes that sales personnel have same work load and they work
with same efficiency.
10. Deduction Method says that we can increase the size of the sales force till the incremental
revenue exceeds incremental costs.

11. Contracts can be made for holding inventory.



Case Study Sales Forecast

US Company comes out with a novel idea of introducing disposable cameras
into the market. It was thought that their cameras have a great potential. A film
Awas already loaded in the camera and after the whole film was used the camera
was to be thrown away, as it cannot be further loaded or unloaded. In the introduction
stage the cameras did not do very well and the sales remained low. This was due to the
objection from a section of a society who was environmentally conscious and objected to
the disposable cameras adding to pollution. Another reason was that the photography
enthusiast did not believe that these cameras could produce good pictures. The management
was disturbed and formulated the following strategy to face these problems.
1. It introduced recycling programme to do away the objection of the environment-
conscious consumers.
2. It increased its promotion and advertising programme and emphasized that its
cameras were capable of taking quality pictures.

3. It also stressed upon the factors that these throwaway cameras were available at all
stores at a minimum price of about eight dollars ($ 8). Also promoting that these
were ideal for people who forget to bring their cameras to important occasions.
Contd...

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