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Sales Management

Notes As the business activity became more complex and dynamic, the term “sales management”
changed due to the changes in business operations. Earlier the sales management was solely
concerned with the direction of the sales force personnel. However, at present the term “sales
management” has a broader significance and includes all such marketing activities as
advertising, sales promotion, marketing research, physical distribution, pricing and product
merchandising.

1.1 Marketing Sales Management

Marketing, sales management and marketing management are closely related to each other.
Generally marketing denotes the process through which the goods/services are transferred to
customers for monetary consideration. It is the performance of business activities that directs
the flow of goods from the producer to the consumer and so it is viewed from the customers
point of view. Every attempt is made under marketing to provide maximum satisfaction to
customers. It starts with the needs of the consumers and ends with their satisfaction.
On the other hand, the term “sales management” is used by businessman to refer to the direction
or supervision of salesmen. But in the present business scenario, it has included other aspects of
management also, such as planning, direction, control of personnel selling, including recruiting,
selecting, equipping, supervising, paying and motivating, etc., for they directly apply to sales
force.

Marketing management is a broader concept and sales management is a part of marketing
management. Whereas marketing is concerned with the product, price, promotion, distribution,
target market, planning and implementation and control of these activities, the sales management
is only a sub-function of marketing management and is mainly concerned with the planning,
direction and control of the sales force.
Sales force are found in both profit and non-profit making organisations. Everyone lives by
selling something. Selling is one of the oldest professions. Today’s selling executives are
professionals. They plan, build and maintain effective organisations and design and utilise
efficient control procedures. This requires a thorough analysis of quantitative and qualitative
personal selling objectives, formulation of sales policies and selling strategy. Top management
holds them responsible for:

1. Achieving an adequate volume of sales.
2. Providing maximum contribution to profit.
3. Experiencing continuing growth.
Although these objectives are included under sales management, sales managers cannot be held
solely responsible for accomplishing or achieving them. Although they make major
contributions, the top management bears the final responsibility because it is accountable for
the success or failure of the entire enterprise. In fact it is the responsibility of top management
to ensure the supply of goods/services to the final buyers at satisfactory prices.
The above mentioned objectives are accomplished after following a pre decided sales strategy.
The top management delegates the required authority to marketing management to execute
these strategies, which in turn delegates it to sales management. During this process the objectives
are broken down in goals which are more specific in nature. These goals are finalized while
planning and then sales manager is given sufficient power and autonomy in guiding and leading
the sales personnel and middlemen who play a vital role in implementing the sales plans.
As far as the contribution to profits is concerned, generally these two basic formulas are followed:
Sales – Cost of Sales = Gross margin

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