Brief explanation about Sales Force Management.

1. SALES FORCE
MANAGEMENT
Unit - 5

3. Meaning & Definition
Meaning:
Recruitment is the process where the prospective
candidate s are found and encouraged to apply.
The aim of recruitment is to attract potential
salesmen to fill up the vacancies.
Definition:
“Recruitment is the active search for the best
available candidates for a sale position.”
- Victor P. Buell

4. Characteristics of Recruitment
• Recruitment Induction is the process of
finding good salesmen in which they are
encouraged to apply.
• It is a continuous process. The search for
salesmen goes on all the time.
• The various sources of recruitment are
determined in it.
• Recruitment is done to fulfill both present and
future requirements.

5. Process of Recruitment of Salesmen
Recruitment of salesmen involves the
following processes:
I. Determination of Nature of salesmen
II. Determination of Number of salesmen
III. Determination of sources of recruitment of
salesmen.

6. Determination of Nature of Salesmen
• Sales personnel planning involves two
important activities-
i. Determining the type of sales personnel
needed.
ii. The number of sales personnel required to
be recruited.

7. (i) Determining the type of sales
personnel needed.
• To measure the activities involved in
identifying the type of sales personnel the
following are needed:
i. Sales Job Analysis
ii. Personal Analysis

8. Sales Job Analysis
Sales Job Analysis means job analysis of sales
function. This is concerned with the
determination of nature of duties and
responsibilities to be performed.
In job analysis the following two activities are
involved:-
• Job description
• Job specification

10. Job Description
• Job description includes basic job-related
data that is useful to advertise a specific job
and attract a pool of talent.
• It includes information such as job title, job
location, reporting to and of employees, job
summary, nature and objectives of a job, tasks
and duties to be performed, working
conditions, machines, tools and equipments
to be used by a prospective worker and
hazards involved in it.

11. Purpose of Job Description
• The main purpose of job description is to collect job-
related data in order to advertise for a particular job. It
helps in attracting, targeting, recruiting and selecting
the right candidate for the right job.
• It is done to determine what needs to be delivered in a
particular job. It clarifies what employees are supposed
to do if selected for that particular job opening.
• It gives recruiting staff a clear view what kind of
candidate is required by a particular department or
division to perform a specific task or job.
• It also clarifies who will report to whom.

12. Job Specification
• Also known as employee specifications, a job
specification is a written statement of
educational qualifications, specific qualities, level
of experience, physical, emotional, technical and
communication skills required to perform a
job, responsibilities involved in a job and other
unusual sensory demands. It also includes
general health, mental
health, intelligence, aptitude, memory, judgment,
leadership skills, emotional
ability, adaptability, flexibility, values and
ethics, manners and creativity, etc.

13. Purpose of Job Specification
• Described on the basis of job description, job
specification helps candidates analyze whether are
eligible to apply for a particular job vacancy or not.
• It helps recruiting team of an organization understand
what level of qualifications, qualities and set of
characteristics should be present in a candidate to
make him or her eligible for the job opening.
• Job Specification gives detailed information about any
job including job responsibilities, desired technical and
physical skills, conversational ability and much more.
• It helps in selecting the most appropriate candidate for
a particular job.

14. Before selection is undertaken, the sales manager should
assess the need for sales force in quantitative terms.
Number of salesmen are estimated on the basis of
i. Future sales
ii. Sales per salesmen
iii. Possibilities of future development
iv. Present no. of salesmen
The following formula is used :
N = S/P (1+T)
N = No. Of salesmen
S = Forecasted sales
P = Productivity of salesmen
T = Rate of sales turnover
Determination of Number of Salesmen

15. Sources of recruitment may be broadly be
divided into :
a. Internal sources
b. External sources
Determination of Source of Recruitment
of Salesmen

16. Internal Sources
• From company’s own staff
• Company executives
• Promotion of employees
• Former employee’s re-employment

17. External Sources
• Educational institutions
• Employment agencies
• Salesmen of non-competing companies
• Competing firms
• Employees of customers
• Application on gate
• Advertisements
• Wholesalers, retailers and customers
• Professional bodies

19. Meaning of Selection
The process of interviewing and evaluating
candidates for a specific job and selecting an
individual for employment based on certain
criteria.
Employee selection can range from a very
simple process to a very complicated process
depending on the firm hiring and the position.

20. Importance of Sound Selection
• Basic of sales
• Establishment of better relations
• Better relations with customers
• Easy and quick training
• Low cost of control
• Limited turnover
• Availability of good executives
• Growth of organisation and increase in
reputation.
• Peaceful atmosphere

21. Who Selects the Salesman
• By The Owner Of The Enterprise
• By Sales Manager
• By Personnel Department
• By Selection Board
• By External Agencies

22. Principles to be Followed in Selection
of Salesman
• Aptitude of salesmanship
• Adequate education and knowledge of language
• Application form
• Checking references
• Personal interviews
• Psychological test
• Medical examination
• Final interview and appointment

23. Selection Test
• Mental Ability Test (capacity of comprehension
and reasoning)
• Aptitude Test (potential ability)
• Achievement Test (gain from education and
training)
• Personality Test (assess an individual
motivation, stress, interpersonal relation and
self-image)
• Interests Test (likes and dislikes)

24. Conditions for Effective Use of Tests
• The test should be properly prepared.
• The test should be job related.
• Capable and experiences person should handle
the test.
• If possible more than one tests should be used.
• The dangers and limitations of different tests
should be kept in mind.
• The test should be reviewed periodically.
• The reliability and validity of any test should be
accepted before it is used as a selection tool.

25. Methods of Interview
• Patterned interview
• Indirect or non-directive interview
• Stress interview
• Group interview

26. Sales Force Training

27. Meaning & Definition
Meaning:
Sales training is very important and covers
generally three broad areas namely – knowledge,
skill and attitude – all three a must for
development of an effective salesman.
Definition:
According to E.B. Fillippo, “ Training is the act of
increasing the knowledge and skills of an
employee for doing a particular job.”

28. Objectives of Sales Training
• Identifying Customer Needs
• Qualifying Opportunities
• Demonstrating Value
• Overcoming Objections

29. Importance of Sales Training
• Lower turnover of sales people
• Better customer relations
• High sales volume
• Reduces control and supervision
• Reduces selling cost
• Provides expert knowledge

30. Types of Sales Training
• Initial training : new recruits are given an orientation training so as to
know about the company and its products. He may be allowed to
work for sometime in the firm itself to gain sufficient information
about the products. After that he is sent to work in his field.
• Job training : In this method, a new salesman is placed under an
experienced or senior salesman who trains him. Initially he trains the
sales techniques, later, takes the trainee along with him on his
rounds and gives him chances to observe the dealings with the
customers.
• Refresher training : Short-term course aimed at recall and
reinforcement of previously acquired knowledge and skills. It is a
form of updating knowledge.

31. Contents of Good Training Scheme
• Objectives
• Basic principles of salesmanship
• Information about the firm
• Information about the product
• Training methods
• Information about the competitors
• Information about market conditions
• Information about customers
• Matters pertaining day to day work
• Evaluation

32. Planning of Sales Training Programme
• A planned training programme should
function with the following ideas or
principles, often referred as ACMEE.
A – Aim of Training
C – Content of Training
M – Method of Training
E – Execution of the Training
E – Evaluation

33. Aim of Training
• Job specifications
• Time management
• Sales related marketing policies
• Product data
• Sales Techniques
• Markets and competition
• Company information

34. Content of Training
• Content for new sales trainees is broader. It includes:
• Company knowledge
• Product knowledge
• Customer knowledge
• Competitor knowledge
• Selling skills / sales techniques
• Examples of specific content for experienced salespersons are:
• New product knowledge
• Introduce change in sales organisation
• Negotiating skills
• Content depends on the aims of training programme
• Who, what, where and when
• Manuals and printed materials
• Training aids
• Candid camera, YouTube
• Assignments

35. Method of Training
Selection of suitable methods for a training programme
depends upon the topic and audience.
• Lecture
• Personal Conference (Curbstone Conference)
• Role Playing
• Case discussion
• Impromptu discussion
• Gaming
• On-the-job
• Programmed Learning
• Group or individual

36. Execution of the Training
• Usually sales trainer or sales training manager is
responsible for entire process of sales training.
• Execution/implementation includes preparing time-
table, arranging internal / external trainers, making
travel arrangements of participants, arranging
conference hall and teaching aids, and so on
• A good practice to make a final check one / two days
prior to start of training programme
• Obtain feedback from the sales trainees at the end of
the programme

37. Evaluation
• Session Review
• Written tests
• Send observers
• Candid camera

38. It is done to improve training design and implementation, and to find if expenditure
was worthwhile.
Outcomes to measure What to measure How to measure When to measure
• Reactions /
Perceptions of
participants
• Training objective
• Was training
worthwhile?
• Questionnaires
•interviews
• After the training
• Learning –
knowledge, skills,
attitudes learnt
• Knowledge, skills,
attitudes
• Tests
• Interviews
• After training
• Before & after –
training
• Behavioural change • Trainees’ change of
behaviour
• Self-assessment by
trainees
• Observation by
supervisors / customers
• After training, over a
period of one year
• Results –
Performance; Benefits
more than cost?
• Sales, Profits
• Customer satisfaction
• Company data
• Management
judgement
• Market survey
• After training,
Quarterly, Yearly
Framework for sales training evaluation

39. Training Methods
The various methods used to train the salesmen
may be grouped as follows:-
• Group training method
• Individual training method

40. Group Training Method
• Lecture Method
• Group Discussion
• Sales Conference
• Role Playing Method
• Case Study
• Round Table Method
• Sales Demonstration
• Simulation or Game Method
• Visual Training

41. Lecture Method
• lectures are delivered by senior supervisors
and leading experts to a group of trainee
consisting of 15 to 20trainees who are sitting
in a room.

42. Case Study
• Under this method, an actual or hypothetical
case of sales is discussed by the trainees inthe
presence and guidance of senior supervisor.
There are open and frank discussions amongst
the members(trainees).

43. Role Playing Method
• Under this method, training is provided to the
trainee by presenting a sales drama before the
trainees

44. Simulation or Game Method
• This method also known as Simulation.
• Uses highly structured contrived
situations, based on reality ,in which players
assume decision-making roles through
successive rounds of play

45. Individual Training Method
In is a method where the principle of ‘self-help’ is
adopted. The salesman is asked to see, observe
and learn for himself. Various methods used are:-
• On the Job Training
• Personal Discussion
• Sales Manuals
• Job Rotation Training
• Correspondence Courses
• Internship Training

46. On the Job Training
• It is a practical method of training in which the
trainee gets actual experience by working
along with some senior supervisor on the job.

47. Personal Discussion
• In the Personal conference, the trainer and
trainee jointly analyze problems. It is an
unstructured and informal method.

48. Correspondence Courses
• The special study courses are supplied to the
trainees through post by a recognized
institution regularly at the residence of the
trainees.

49. Internship Training
• This method of training refers to a joint
programme of training in which the technical
institution and business houses co-operate

50. Sales Compensation

51. Meaning of Remuneration
• Remuneration is the total compensation that an
employee receives in exchange for the services he/she
performed for the employer.
• Typically, this consists of monetary rewards, also referred
to as wage or salary and includes a number of
complementary benefits.
• In other words, it is reward for employment in the form of
pay, salary, or wage, including allowances, benefits (such
as company car, medical plan, pension plan), bonuses,
cash incentives, and monetary value of the noncash
incentives.

52. Need of Remuneration
A good scheme of remuneration can help to
fulfill the following major functions:
• Attracting sufficient and desirable sales people.
• Rewarding sales employees for productivity.
• Retaining desirable sales people.
• Correcting sales costs with sales results.
• Controlling sales activities.

53. Essentials of a Good Remuneration
• Simplicity
• Minimum Income
• Flexibility
• Lower Administrative
Cost
• Periodic Increment
• Stability
• Direct Incentive
• Helpful to increase
efficiency
• Proportionate reward
• Fair and equitable
• Promptness
• Talent oriented

54. Factors Affecting Remuneration of
Salesmen
• Nature of Product or
Service
• Nature of Competition
• Condition of the Market
• Experience and Efficiency
of Salesman
• Amount of Sale
• Advertising Sales
Promotion
• New Product or New
Market
• Reputation and Financial
Position of the Enterprise
• Competitive Position
• Remuneration of the
Competitive Institution
• Amenities
• Economic condition of the
country

55. Compensation Elements
A sales compensation plan has many as four basic elements.
1. A fixed element, either a salary or a drawing account, to provide
some stability of income.
2. A variable element (for example, a commission ,bonus, or profit
sharing arrangement) to serve as an incentive.
3. An element covering the fringe or “plus factor”, such as paid
vacations, sickness & accident benefits, life insurance, pensions.
4. An element providing for reimbursement of expenses or payment
of expenses allowances.

56. Methods of Remuneration
• Time Rate Method
• Piece Rate Method
• Fixed Salary or Straight Line Method
• Straight Commission Method
• Salary and Commission Method
• Drawing Account and Commission Method
• Salary Bonus and Commission Method
• Bonus Method
• Quota Method
• Promotion Method
• Fringe Benefits Method
• Pooled Commission Method
• Sales Contest and Prize Method

57. Time Rate Method:
• Under time rate system, remuneration is directly linked with the time spent or
devoted by an employee on the job. The employees are paid a fixed pre-
decided amount hourly, daily, weekly or monthly irrespective of their output.
It is a very simple method of remuneration. It leads to minimum wastage of
resources and lesser chances of accidents. Time Rate method leads to quality
output and this method is very beneficial to new employees as they can learn
their work without any reduction in their salaries. This method encourages
employees unity as employees of a particular group/cadre get equal salaries.
• There are some drawbacks of Time Rate Method, such as, it leads to tight
supervision, indefinite employee cost, lesser efficiency of employees as there
is no distinction made between efficient and inefficient employees, and lesser
morale of employees.
• Time rate system is more suitable where the work is non-repetitive in nature
and emphasis is more on quality output rather than quantity output.

58. Piece Rate Method
• It is a method of compensation in which remuneration is paid on the
basis of units or pieces produced by an employee. In this system
emphasis is more on quantity output rather than quality output. Under
this system the determination of employee cost per unit is not difficult
because salaries differ with output. There is less supervision required
under this method and hence the per unit cost of production is low.
This system improves the morale of the employees as the salaries are
directly related with their work efforts. There is greater work-efficiency
in this method.
• There are some drawbacks of this method, such as, it is not easily
computable, leads to deterioration in work quality, wastage of
resources, lesser unity of employees, higher cost of production and
insecurity among the employees.
• Piece rate system is more suitable where the nature of work is
repetitive and quantity is emphasized more than quality.

59. Fixed Salary or Straight Line Method
It is simplest compensation plan. Salesperson receive
fixed sums as regular intervals(usually each week or month
sometimes every 2 weeks), representing total payments
for their services. Such plans are more common among
industrial- goods companies than among consumer- goods
companies.
Such plans are engaged in trade selling. These jobs, in
which selling amounts to mere order taking, abound in the
wholesale & manufacturing fields, where consumer
necessities are distributed directly to retailers. It is also
used for paying driver- salesperson selling liquor &
beverages, milk & bread, similarly distributed products.

60. Straight Commission Method
The theory supports the individual sales personnel
should be paid according to productivity. As sales
volume rises to different levels, the commission rates
differ for different products, categories of
customers, or during selling seasons.
This method is common in the clothing, textiles &
shoe industries & in drug * hardware wholesaling.
Firms selling intangibles, such as insurance &
investment securities, manufacturers of
furniture, office equipment & business machines also
are frequent users of straight- commission plans.

61. Salary and Commission Method
Most sales compensation plans are
combinations of salary & commission plans.
By a judicious blending of the two basic
plans, management seeks both control &
motivation. Actual results depend upon
management’s skills in designing &
administering the plan.

62. Drawing Account and Commission
Method
• Under this, the firm maintains salespeople’s
individual accounts from which the money is
advanced to the salespeople against future
commissions and the commissions due are
credited to this account periodically. The
overdrawn amount is adjusted in future.

63. Salary Bonus and Commission Method
• In this, the straight salary is paid for certain specific
duties performed by the salesmen. In case the salesmen
puts extra efforts or sells beyond a pre-determined
limit, he is paid commission and bonus.
The quantum of commission bonus depend upon
– Volume of sales
– Profits of the company
The form of commission bonus may be in the form of
cash or prizes or services to members of the family.

64. Bonus Method
• A bonus is an amount paid for accomplishing
a specific sales task, it is paid for reaching
sales quota, performing promotional
activities, obtaining new accounts, following
up leads, setting up displays, or carrying out
other assigned works.
• It is like an additional financial reward to the
sales person for achieving results beyond a
predetermined minimum.

65. Quota Method
• In this method, a fixed salary is paid but the
calculation of commission is not paid on total
sales effected by salesperson.
• A minimum quota is fixed for each salesman and
no commission is paid until he crosses his quota
figure.
• In other words, he has to qualify himself for the
benefit of commission by selling over the quota
fixed for him over a time period.

66. Fringe Benefits Method
• Fringe benefits do not bear direct relationships to
job performance.
• They lack the motivational force, but take care of
the safety and security needs.
• They are provided by federal & state law.
• For example, payment for social security
premiums, unemployment compensation, worker’s
compensation, pension
plan, holidays, vacations, hospitalization, insurance,
car parking, company providing housing etc.

67. Pooled Commission Method
• Under this method, salesmen working in a certain
area are regarded as a team. The total
commission earned on the sales of the group as a
whole is then divided amongst the salesmen.
• This division may be equal , or may be partly on
the individual sales and the remaining is evenly
distributed.
• By making each person partly responsible for the
earnings of each member of the group, an
atmosphere is created which is expected to prove
stimulating.

68. Sales Contest and Prize Method
• Sometimes companies use sales contests and
offer prizes to boost the competitive spirits of
the salesmen. As a result to win sales
contest, salesmen make special efforts to
increase sales volume. Special quotas are fixed
and salesmen who are able to reach those
targets are properly rewarded. These rewards
may be in the form of cash or other benefit.s

69. QUERRIES ?
ALL THE BEST FOR THE EXAMS !!!