Page 79 - DMGT205_SALES_MANAGEMENT

Unit 5: Sales Organisation

Questions Notes
1. In your opinion what alternative should be adopted by the company and why?
2. What should be the policy for rush orders?

Notes Physical distribution cost consist of freight rates, labour cost, storage, insurance,
transport, storage, inventory control, order processing, material handling, etc.

The balance between customer service and cost distribution is devisable.

5.11 Summary

 Sales organisation is a group of people working together to achieve the objective of sales.
 A sound sales organisation defines people in the organisation in terms of authority,
responsibility and accountability and identifies flow of authority.
 A sales organisation bridges the gap between the market and the productive capacity of
the firm.

 Functional authority enables specialists in particular areas such as in technical product
service to enforce their directives within a specific and limited field.

 The personnel looks upon sales organisation as something that will advance and improve
their future career.
 Regional Managers are the line managers responsible for operating results in their own
territories and control their own field staff.
 Sales organisation is the framework of relations of different people in the enterprise.
 A supplement to organisational chart is an organisational manual which incorporates the
company as well as departmental chart.
 Control and coordination in a sales organisation can be done both formally and informally.
 The organisational manual is an extension of the organisational chart.

 A well managed channel structure offers a good training ground as the shortcomings are
well known to the executives.
 Operational details of managing the sales department takes up a large part of line executives
time.
 The organisation can also be customer based i.e. salesman catering to different type of
customers.
5.12 Keywords

Combined Base Organisation: In this type of organization two or more bases are combined to
form an organisation structure. It may overcome the problem of individual sales
organization.
Customer Based Sales Organisation: The organisation can also be customer based i.e. salesman
catering to different type of customers. A company making computers can have salesman catering
to Govt. offices, commercial. Houses, individuals.

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