Organizing the sales effort


The task of a sales manager is to organize the resources in such a way that it helps to achieve the sales objectives. One of the most important resources is the sales team. The Sales Manager has to organize them in such a way that their maximum potential of the team is used and also the brand’s objectives are achieved at the lowest cost.

We are discussing here a few methods of organizing the sales force (team) which are based on firm’s strategy and needs of the products to be sold

Product Based

The sales manager may organize the sales team on the basis of an individual product. This form of organization is commonly seen in multi-product companies like Larsen and Toubro. The advantage is to determine profit contribution from each product. But the disadvantage is that the same customer may be called upon by different sales people selling different products. This means more cost of serving this customer. If the customer is not satisfied with one product or has a problem in one product, he/ she may express it to other salesperson from the company. In fact, the salesperson may not be aware of the problem, thus further angering the customer. Some companies have tried to resolve this through their sales reporting systems which may go up to the group manager

Territory Form

A sales territory represents a continuous set of customer and prospect accounts bounded by the geographical limits. Some of the common forms of territory design are clover leaf, circular and straight line. These also reflect the routing plan of the salesperson.

It is necessary that each territory is large enough to motivate sales people and must possess equal opportunities for earning. Also, the need of the salespeople to spend as many nights as possible at home must be considered. This is important both from the individual’s motivation and cost perspective.

Today, the sales person manger has computer based models and quantitative information that can help him / her to design most profitable sales territories. The limitation of this form of organization is that the salesperson may not give adequate time or equal time to all the products. Many a time, it has been observed that salesperson spend more time selling fast moving products or those that help them earn more commission. Also, they may not spend adequate time on all customer accounts. In reality, they may be spending more time with “easier� customers.

Customer or Segment based Organization

Another form of sales organization is customer or segment based. Here, the salesperson is allotted a market segment or customer in a particular industrial group.

Hence, in a packaging firm, the sales force may be organized as being food and beverages, petroleum, and other light engineering products. This helps the firm to focus on market segment and their specific requirements. It also enables the firm to maintain a lean sales organization and hence keep the costs down. But the problem here is that if a segment or customer has not been served well by the salesperson it can affect the future of the organization itself.

We can observe from the above, no single method or combination of methods is the right choice. The need is to be deduced from various reports of the market and the best method / s required has to be implemented by the Sales Manager. Ultimately the firm should end up with increased revenues and higher profits whatever the methods are adopted.