Sales strategies, decision, review and budgets


Sales strategies are made after overall marketing policies of a firm are formulated. The strategy can be a long term one may 1 to 3 years or more and Tactics are adopted on a short term basis. Some intermittent tactics based on the Market forces are adopted as and when required. The Marketing / Sales Manager must be astute to understand the necessity and advise top management for getting the schemes sanctioned as it involves expenditure. He must also identify and project the increase in movement of slow moving items as well as incremental profits.

A recent example is Big Bazaar’s sale announcement of one free for one purchased or a CTV @Rs.4000/- .The news was that the unprecedented crowds for even subject to controlling by Police and those who could buy came out of the stores after 4 to 6 hours.

Sales strategies are the blueprints for action that marshal and reconcile the sales function’s resources with environmental constraints. Most of these emanate from corporate marketing strategies. For example, based on corporate and product objectives an important strategic choice is in distribution. Will an exclusive or intensive or selective distribution help achieve their objectives. Based on this, arises the issue of identifying dealers in different locations. Broadly speaking, a sales manager has to decide on market penetration, concentration or a segmental strategy. Another strategic choice is that of differentiation versus standardization in different territories and customer accounts.

Tactical Decisions

Tactics are short term in nature, unlike strategies. They are designed for immediate results. Thus sales tactics fill in the operational details of a strategy and specifically spell out each individual’s responsibility. Some of these relate to discounts and the discretion that different individuals in the sales team have to give to get a specific customer account; activities and events required to be sponsored that will enhance the brand equity and the hike.


A sales plan’s success is dependent on how it has been implemented. For this, it is important that the plan be communicated to the entire sales team. This is generally achieved at the annual sales conference. The sales manager will need to design an incentive plan to ensure a sales plan’s success. Additional training may become necessary when the role of a salesperson is being changed say from inventory management to competitively selling in the territory, the firm may have to plan a training session to equip its sales force adequately.

Review and Feedback or Control Phase

The sales manager needs to review, with the sales team, how well they have done. The Manager has to investigate the reasons of variance, i.e. actual performance against plan to ensure that in future the variance is negligible or not there at all. It is important to understand that this variance may arise due to external or salesperson related variables. While the sales manager may have no control over the former, he / she needs to microscopically examine the latter variables.

Sales Budgets and Quotas

Sales budgets ate the financial aspects of the sales plan. Typically, this includes projected sales and the revenue for the year. If then considers costs required to achieves the sales revenue. This includes both, the fixed and the variable costs. Fixed costs here refer to rent of the branch and warehouse premises, depreciation on equipment used in sales offices (like computers, typewriters etc.), and salary of sales and non sales personnel, etc. Variable selling costs are sales man travel costs, entertainment expenses, a salesman’s daily boarding and lodging expenses while in the territory, commissions if any, etc. A sales budget ensures that costs are controlled and no activity is undertaken which will unnecessarily drive up the selling costs. Often, this sales budget is broken down territory wise or branch wise. Some firms have found that a monthly or quarterly review of the budget has helped them achieve their profit goals

Sales quotas are individual targets of the salesperson. The quota emanates from the regional sales objectives and invariably has all the dimensions which we mentioned under the sales objectives. The quota spells out sales, market share, new customer account, profit contribution and customer satisfaction index.

Quotas have to be quantitative in nature because individual salesperson’s performance will be evaluated on their basis. They have to be ambitious enough to challenge the individual’s potential. In other words, they have to be motivating. Often, sales people are consulted in determining their quotas. But, sales managers use their judgment to finally arrive at the quota.

The above deliberations clearly indicate that intelligent thinking and implementation of strategy and tactics are to be initiated by the concerned manager in order to survive competition as well as more profits to his employer. This cannot be just one time but needs continuous vigilance and shrewd tactics on the part of the manger and to some extent even the top management.