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Constructing a Sound Sales Organization

Learn about organizing the sales force to achieve marketing goals by responding to market needs, arranging activities efficiently, and establishing communication channels. Explore various types of sales organization structures within the sales department.

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Constructing a Sound Sales Organization

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  1. CHAPTER - 5 ORGANIZING THE SALES FORCE

  2. THE PURPOSE OF ORGANIZATION To facilitate the achievement of marketing and sales objectives and goals by – Responding to market needs - shorten the time flexibility openness to change Arranging activities efficiently - specialization routinization Establishing channels of communication

  3. TYPES OF ORGANIZATION VP, Marketing LINE ORGANIZATION National Sales Manager Sales Manager Sales Manager District 1 Manager District 2 Manager District 1 Manager District 2 Manager Branch Manager Branch Manager Branch Manager Branch Manager Salespeople Salespeople Salespeople Salespeople

  4. TYPES OF ORGANIZATION STAFF ORGANIZATION VP, Marketing Director of Marketing Research Sales Manager Director of Sales Training Technical Manager District Manager Salespeople Staff Line

  5. TYPES OF ORGANIZATION FUNCTIONAL ORGANIZATION VP, Marketing Sales Manager Director of Sales Training District Manager Technical Service Manager Sales force

  6. TYPES OF ORGANIZATIONWITHIN THE SALES DEPARTMENT GEOGRAPHIC ORGANIZATION Appropriate when: Customers are widely dispersed Customers are located in similar industries near each other Regional differences in customer behavior are great Personal relationships are important Geographic markets are large enough

  7. GEOGRAPHIC ORGANIZATION TYPES OF ORGANIZATIONWITHIN THE SALES DEPARTMENT • Advantages • Decentralization • Flexibility • Disadvantages • Overhead costs of management • Problems in coordinating total company sales efforts • Lack of functional specialists

  8. TYPES OF ORGANIZATIONWITHIN THE SALES DEPARTMENT PRODUCT-ORIENTED ORGANIZATION Appropriate when: Product complexities and differences are great The marketing programs need to be coordinated at the customers’ level Product introductions are frequent There are large differences in locations of products on life cycles Products are sufficiently important to justify special attention

  9. TYPES OF ORGANIZATIONWITHIN THE SALES DEPARTMENT PRODUCT-ORIENTED ORGANIZATION • Variations of product-oriented organizations: • Product divisions • Product marketing groups • Product specialization within certain functions • Product managers

  10. TYPES OF ORGANIZATIONWITHIN THE SALES DEPARTMENT PRODUCT-ORIENTED ORGANIZATION • Advantages • Increases sales force knowledge of company products • Provide expertise in helping customer problems • Disadvantages • Additional expense • Possible irritation of customers

  11. TYPES OF ORGANIZATIONWITHIN THE SALES DEPARTMENT FUNCTION-ORIENTED ORGANIZATION Appropriate when: Activities require special expertise Products are few in number and similar Functions are sufficiently important to justify special attention

  12. TYPES OF ORGANIZATIONWITHIN THE SALES DEPARTMENT MARKET-ORIENTED ORGANIZATION Appropriate when: Customer needs and products purchased vary greatly from one industry to another It is important to avoid confusion and duplication of effort in serving customers Customer groups are large enough to justify special attention There is a substantial need to identify and solve customer problem

  13. TYPES OF ORGANIZATIONWITHIN THE SALES DEPARTMENT MARKET-ORIENTED ORGANIZATION • Sales department in many companies are usualyy classified by – • Organization by industry • Organization by channel of distribution • Organization by national or key accounts

  14. TYPES OF ORGANIZATIONWITHIN THE SALES DEPARTMENT MARKET-ORIENTED ORGANIZATION • Advantages • Overcome the limitations of product structure in satisfying customer groups • Disadvantages • Expensive overlapping of territorial sales coverage • Added layer of management and increased compensation for salespeople

  15. CONSTRUCTING A SOUND SALES ORGANIZATION • A market-oriented approach • An approach designed around sales activities • Defined areas of authority and responsibility • A reasonable span of control • Flexibility • Coordination and balance

  16. QUALITY OF THE SALES ORGANIZATION • Be sure that authority equals responsibility • Put salespeople where they fit best • Be willing to delegate • Be more than just an efficiency expert • Hold sales force personnel accountable for what they do • Be flexible • Know what needs to be done • Organize the sales force so that unequal workloads are avoided

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