Page 90 - DMGT507_SALES AND PROMOTIONS MANAGEMENT

Sales and Promotions Management

Notes M - Measurable
A - Attainable
R - Realistic
T - Time bound.

4. Another important consideration is that the contests must be held at an appropriate time
(time of the year, season, etc.) keeping is mind the goal be accomplished within the given
time frame.
5. The manager must also consider the duration of the contests. This should neither be too
long nor too short. Most writers are of the opinion that contests must be between one to
four months. The ideal duration is about 4-6 weeks, in this period enthusiasm and interest
of the contestants can be maintained in an effective manner.

6. The sales force must be kept up to date with the latest information. The changes, if any, in
the contest should be intimated immediately. The latest standing in the competition must
be known.
7. An adequate supply of promotion material must be provided to maintain enthusiasm.
A theme may be selected for promotion, this may revolve round the festival or any
national or international event.
Sales contests are means to stimulate sales personnel. They provide incentives to increase profits,
sales value, achieve specific objects. The contests are also a means of breaking the monotony of
every day work. The salesmen who are devoted and are able to achieve the specific targets get
highly motivated and their morale is boosted. They are looking forward for such opportunities
to show their skill and stand out in the competition. It gives them good ideas and chance to
develop team spirit and interact with customers and fellow salesmen. Most progressive companies
are using sales contests for their benefit, benefit of customers and dealers.

Task Collect information about the sales contests that are held at large sales
organisations. If possible, also find out the effects of those contests on the
performance of the sales force.

4.3 Sales Budget

A sales budget is a programme designed for a stipulated time frame that highlights the selling
expenses and anticipated sales, quantitatively and in value terms. This helps in making an
objective estimate of net profit on the selling operations. In a real sense, it is a statement aimed
at comparing the revenue, net profits, sales volume and the selling expenses relating to a
particular product or the entire business.

The first point in designing a sales budget is the anticipated sales volume. The top sales executives
would be involved in this to the extent of their participation in the sales forecast.
There are three types of sales expenses:

1. Fixed Expenses: These expenses pertain to the compensation of salespersons, office rent,
insurance and interest on fixed assets like vehicles, office space, office equipment, etc.
2. Performance-related Expenses: These include commissions, incentives, bonus and awards,
etc.
3. Activity-related Expenses: These include travel and communication expenses, etc

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