Sales Force Management Function and Basic Elements

admin

By: Site Engineer, Staff

full bio

Selling is the process of presenting goods/services as tools for bringing consumer satisfaction. In selling process fact and ingenuity are needed because there are other competitors in the market place selling similar products/services. Selling is not an instrument of forcing the prospective customer to accept your product but rather one for achieving customer satisfaction.

From a point of view, a salesman is only an agent who stands between the enterprise and the customer. The salesman as an agent must believe in three things these are:

  • The goods or services he is selling.
  • The enterprise (company) he represents.
  • Himself (the man doing the selling).

Salespeople are classified into three main groups:

  • Paid Employees: These are employees of manufacturers, distributors, retail and services salesmen. They could be sub-divided into groups such as manufactured salespeople, distributors salespeople, retail salespeople, and service salespeople. They are paid salaries or commission for the job they perform by the organizations they work for.
  • Self-Employed: The self-employed salespeople are mostly found in developing countries. These are more than the paid employee salespeople. This category of salespeople consists of all market traders in our rural and urban market. Shopkeepers and hawkers who are more or less mobile salespeople. They carry their wares from place to place. They employ themselves and perform all the functions of paid salesmen.
  • Unpaid Sales People: Unpaid salespeople are those selling without any form of compensation. They are more of assistants even though they may command a store. These are made up of either:

(a)        The children of the proprietor or the enterprise

(b)        The wife or wives of the owner and

(c)        House helps (house boys or girls)

They are paid in kind rather than in cash. They are regarded as part owners though they have no shares and do not participate in the dividend, or profit sharing.

Recruitment and Selection

Company policies vary with regard to recruiting salespeople. In some companies, all recruiting activities are handled by the district sales manager’s office. In other firms, the sales manager makes the hiring decision after the personnel department has screened applicants. In some retailing firms, the personnel department may handle the hiring decision. In a small retail firm, the store manager may be responsible for hiring decision. In recruitment and selecting good personnel, the firm uses many sources such as colleges, polytechnics, universities, other companies, internal sources etc. Apart from the use of formal sources informal sources such as sales and non-sales staff friends and other workers who have aptitudes for selling are very common sources who may recommend people as salespersons.

Methods used by companies in selecting their sales force include advertising in newspapers and magazines head-hunts in other companies, expert/consultants both in recruitment and selection, using experts/consultants and/or internal managers for interviewing and selection.

In the selection process the company has to:

  • Evaluate the application forms filled or application letters;
  • Check the references supplied by the applicant;
  • Conduct personal interviews; and
  • Give both oral and written tests to measure aptitude, mental and intellectual ability for the job.

 Compensation and Motivation of the Sales Force

The sales force compensation plan is an essential part of the total pro-compensation plan as each plan is designed to fit a company’s special needs and problems.

A good compensation plan must not only provide a living wage but must provide a mechanism for matching pay levels with performance in line with the expectancy theory of motivation, and for making sure that salesmen are convinced that the performance of their roles will lead to the fulfillment of other desires.

In designing a compensation plan a firm must follow logical steps such as:

  • Job Evaluation
  • Pricing Job Value
  • Compensation Structure
  • Compensation Forms
  • Administration of the Plan

Forms of Compensation

As mentioned above, companies use different forms of compensation to motivate salesmen, the most popular form of compensation are:

  • Straight Salary: Under the straight salary plan salesmen receives fixed sums at regular intervals (weekly or monthly). This is most ideal for salesmen engaged in trade selling. It has the advantage of assuring the salesman a means of livelihood since despite performance he is sure of receiving that fixed amount. However, this de-motivates high-performance personnel as they may not receive anything for excellent performance.
  • Straight Commission: This is where the salesman remuneration is based on the volume of sales he generates. This plan has the greatest advantage of providing maximum direct monetary incentives to salesmen to strive for high-level volume. The major demerit of this plan is that the company hardly has any financial control over the salesman.
  • Salary Plus Commission: This is aimed at both assuring the salesman of remuneration as well as providing motivation for salesmen who performs above average or excellently well.
  • Salary Plus Commission Plus Bonus: This plan combines the advantage of salary and commission and in addition provides some bonus for good performance. The bonus may represent cash gifts, products of the company etc.
  • Straight Salary Plus Bonus: The salesman receives a fixed salary but in addition is paid bonus for good performance or high profit. There may be additional monthly salary during the Christmas period known as the 13th-month salary. Other forms of bonus include 10% of the equity share of the company being resources for workers.
  • Non-cash Incentives: In addition to this compensation, plan many companies have other non-cash incentive used to motivate the sales force. These include a free quantity of the product of the company given periodically to the workers, sales meeting, honor award, examination leave, recognition, free life insurance, free healthcare, vacation trips etc.
  • Basic Salary Plus Allowance Plus Fringe Benefit: In Nigeria, the most popular compensation structures is the basic salary plus allowances plus fringe benefits. This shows that employee compensation is not limited to salaries alone. Other allowances paid to workers by so many companies include housing, transportation, leave, travel, entertainment, medical and canteen services. A fringe benefit such as pension and gratuity schemes, life and accident insurance etc. These allowance and fringe benefits are provided in order to:

(a)        Motivate staff to achieve high productivity and efficiency

(b)        Reduce employee and union grievance

(c)        Enable management to exercise centralized costs control

Sales Evaluation and Control

Salesmen are normally assessed and evaluated at the end of their sales operations the most difficult task of the sales manager is evaluation and control. This is a situation where he is faced with determining another person’s fate. In doing this, many factors come into play including demerit, performance, politics, physical, psychological and so on.

Here, it is assumed that the sales manager has already set a standard against which he has to compare the salesmen’s performance against the standard already set before the operation. The assessment will be based on a control process established.

Basic elements that the sales manager must consider in the control process in order to be effective include goals actual results and feedback.

  • Goals/Objectives: The sales manager must review the goals set for the salesman.
  • Actual Results: These are the end results or actual performance arising from the implementation of the goals. The results are compared to the goals. Deviations arising out of the comparison could be positive or negative. Whichever is the case, the sales manager must find the cause of the deviation.
  • Feedback: The causes of the deviations are adjusted and feedback is sent to goals/objectives. The goals of the firm could be redefined and setup for the next trading season.

 

Don’t forget to share this post!

share:
Whatsapp Share Icon