Sales MANAGEMENT

18MBAMM401

KSSEM

BY PRADEEP

8147544492

BATCH 2018-2020
 Sales Management – (18MBAMM401)

CHAPTER-1
Unit 1: Introduction to sales management:
• Meaning, Evaluation,
• Importance,
• Personal Selling,
• Emerging Trends in Sales Management
• sales organizations
• Qualities and responsibilities of sales manager.
• Types of sales organizations.

DEFINE SALES MANAGEMENT

“Sales management is the attainment (achievement)of sales force goals(sales/profit) in an
effective and efficient manner through effective
• Planning
• Staffing
• Training
• Leading
• Controlling organizational resources”

According to American Marketing Association, sales management refers “the planning,

direction and control of personnel selling, including recruiting, selecting, equipping, assigning,
routing, supervising, paying and motivating as these tasks apply to the personal sales force.”

DEFINE PERSONAL SELLING

Personal selling is also known as face-to-face selling in which one person who is the salesman
tries to convince the customer in buying a product.
Personal selling occurs where an individual salesperson sells a product, service or solution to a
customer (client).

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

LIST OUT THE OBJECTIVES OF SALES MANAGEMENT:

There are mainly three such objectives
• Sales Volume
• Contribution to profits
• Continuous organisation Growth
Others are as follows
1. Revenue Generation – One of the main objectives of sales management is to generate
revenue for the organization. The sales department is solely responsible to bring in the
money.
2. Increase Sales Volume – Through efficient sales management, the organization wishes to
increase the number of units sold. This will ensure that the production facilities do not
remain idle and are utilized to the fullest.
3. Sustained Profits – Sales management has an objective of improving the profits of the
organization through effective planning, coordination, and control. Sales management
strives to increase sales and reducing costs, this ensures good profits for the organization.
4. Organization Growth – With the sustained and continuous sales management techniques,
the organization tends to gain market share and results in growth of the organization.
5. Market Leadership – With increased sales volumes and profits, ‘sales management’
enables an organization to become the market leader.
6. Converting Prospects to Customers – Getting prospects to become customers is an art and
a science, it requires good planning and sustained efforts. This is accomplished through
sales management.
7. Motivate the Sales Force – One of the core objectives of sales management is to motivate
the sales force. Selling is a very stressful task, achieving sales targets can become very
challenging. Therefore, the sales management task is to ensure that the sales force is
continuously motivated through proper incentives and reward systems.
8. Compliment Marketing Activities – Sales management’s task is to support the marketing
functions of the organization. Marketing and sales need to go hand in hand to achieve the
desired results.

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

LIST OUT THE IMPORTANCE OF SALES MANAGEMENT

• Allocating of sales force and setting sales quota
• Compensating, motivating and leading the sales force.
• Analyzing sales volume cost and profit
• Measuring and evaluating sales force performance.
• Monitoring marketing environment
• Improves Product Development
• Optimizes Distribution
• Allocating of salesforce and setting sales quota
• Compensating, motivating and leading the salesforce.
• Analyzing sales volume cost and profit
• Measuring and evaluating salesforce performance.
• Monitoring marketing environment
• Improves Product Development
• Optimizes Distribution
• Better Financial Decisions
• Improves Staff Quality
• Introduction of new products in the market.
• Increasing the production of existing products.
• Reducing cost of sales and distribution.
• Export market.
• Development in the means and communication of transportation within and outside the country.
• Rise in per capita income and demand for more goods by the consumers.
• To stimulate sales-effort.
• To enforce proper supervision of sales-force.

WHAT ARE THE SALES MANAGER QUALITIES

• A good organizer and administrator, able to plan, implement and monitor sales activity
• Innovator and creator of new ideas and promotion
• confident & motivator to salesmen

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

• A-team leader,
• A good communicator, with subordinates, customers and trade contacts at all levels
• Positive attitude.
• Inspiring colleagues and subordinates with a sense of leadership, direction and
confidence
• An opportunist and a worthy advisor
• A team-mate and referee.
• Successful mentor
• Patience
• Value time
• Sense of commitment

LIST OUT THE RESPONSIBILITIES OR DUTIES OF SALES MANAGER

• Determining Sales force objectives and goals
• Finalizing Sales force organisation, size, territory and quota
• Forecasting and budgeting Sales
• Designing sales policies
• Motivating and leading the sales force
• Designing the compensation plan and control system
• Designing career growth plans and building relationship strategies with key
customers
• Sales planning and budgeting
• Estimating demand and forecasting of sales.
• Determination of size and structure of the sales organization.
• Recruiting, selecting, and training of sale’s people
• Studying marketing conditions
• Managing sales promotion & advertising
• Analyzing sales volume cost and profit
• Measuring and evaluating salesforce performance.
• Monitoring marketing environment

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

EXPLAIN THE EMERGING TRENDS IN SALES MANAGEMENT

To be successful in a changing market environment, it is important that sales managers
understand the importance of emerging trends in the following areas
✓ Global Perspective
✓ Technological Revolution
✓ Customer Relationship Management [CRM]
✓ Sales Force Diversity
✓ Team Selling Approach
✓ Managing Multi-Channels
✓ Ethical and Social Issues
✓ E-Selling
E-selling: it is known as electronic commerce which means buying and selling online by using
internet. A lot of companies are beginning to sell product and services online. E-commerce are
the part of e–marketing where promotion and selling are done through the internet. It enables
the co. To build relationships with the target audience.

Global Perspective: A company faces competition not only from domestic companies but
also from the companies abroad, sales management must meet foreign competition. They must
also improve personal selling efforts in other countries. Companies selling goods and services in
the global market, faces new challenges due to differences in culture, languages, lifestyle etc.
Sales mangers must develop a global perspective
Global competition is intensifying. Domestic companies who never thought about foreign
competitors are suddenly finding them in their backyard. This is a challenge which sales
managers and salesperson must take on, they have to improve their personal selling efforts not
only in their countries but also in foreign countries. Selling goods and services in global markets
presents a challenge due to differences in culture, language, needs and requirements.

Technological Revolution: In order to compete successfully, sales department must adopt

the latest technology. This technological innovation helps to increase the efficiency and reduce
the cost of sales efforts.
Digital revolution and management information system have greatly increased the capabilities
of consumers and marketing organizations. Consumer today can get information about
PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE
 Sales Management – (18MBAMM401)

products, compare it with other brand, place an order and place an order instantly over the
internet. This has led to a different kind of sales force who collects information about internet
users, markets and prospects of internet buyers. It is mandatory for all companies to have their
website now. To compete effectively, sales person and managers will have to adopt the latest
technology.
Ex: For example, the banking industry has reduced the cost of serving its customers by using
technologies such as automated teller machines (ATM’s), toll-free call centers, and the Web.

Customer Relationship Management [CRM]

Information technology enables a company to provide excellent customer service, by meeting
the individual needs of each customer. Creating new customers is more costly as compare to
retaining them. Therefore, companies have started “CRM” programs to expand their
relationships with the customers. The challenge before sales management is to identify the
market segments who will respond to CRM.
Combining information technology with relationship marketing has resulted in customer
relationship management. Interestingly, the concept of relationship marketing came about
earlier by bringing quality, customer service and marketing together. Relationship marketing
aims in building long term satisfying relations with key customers distributors and suppliers in
order to earn and retain their long term preference and business. CRM enable companies to
provide excellent real-time service by focusing on meeting the individual needs of each valued
customer, through the use of CRM software packages.

Sales Force Diversity

The demographic characteristics of sales force is changing and becoming more varied. For
example, more and more women are taking up careers in sales management and selling. Also
the education level of sales people is going up most of them holding a college degree or a post
graduate degree. Sales managers now have to handle a sales force of these varied demographic,
expectations of each and every individual is different and sales manager needs to use different
motivational tools against each one of them.

Team Selling Approach

The practice of team selling is more widely followed by most companies in recent years.

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

Team selling is the use of teams made up of people from different functional areas to service
large accounts. Increasingly, sales representatives who lack technical expertise work as a team
with a technical expert. In this arrangement, the duties of a sales representative are to make the
preliminary contact with customers, introduce the company’s product, and close the sale. The
technical expert will attend the sales presentation to explain and answer questions and
concerns.
Team selling approach is used when company wants to build a long term mutually beneficial
relationship with major customers, who have high sales and profitable potential. It is used for
selling a technically complex product or a service to a potential customer. The composition of
team may vary depending upon the customer from top management, technical specialist,
customer service, etc…

Managing Multi-Channels
Multi-channel marketing system occurs when organization uses two or more marketing
channels to target one or more customer segments. Major benefits of multi-channel marketing
system are:
• Lower channel cost
• Increased market coverage
• Customized selling
Multi-channel may also lead to conflicts and control problems, as two or more channels may
compete for same customer. A successful sales manager will have to effectively manage conflict
between the channels.

Ethical and Social Issues

Sales managers have ethical and social responsibilities. Sales people face ethical issues such as
bribery, deception (or misleading) and high pressure sales tactics. Giving payment or gift to get
an order, misleading the customer by exaggerating the benefits of a product and using high-
pressure tactics of committing wrong delivery schedules to a customer needing urgent delivery
of a raw material are example of unethical behavior of salesperson. Today’s sales managers
have no choice but to ensure ethical standards from sales force otherwise they may be out of
business or even land up in legal problems.

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

Sales Force Automation (SFA)

Applications of computer and other technologies to make the sales function more efficient and
competitive. Many salespeople need to go to the prospective customer in order to demonstrate
or illustrate the particulars about the product. Technology makes salespeople more effective
and productive because it allows them to provide accurate and current information to
customers during sales presentations.
Sales automation (also known as customer asset management and total customer
management) implies that technology can be used to speed up previously inefficient
operations. The Internet and related technology have affected the personal selling process.
Product information on Web sites is available to customers and prospects. In the past,
salespeople delivered this information to the customer. The Internet frees salespeople to focus
on the most important aspects of their job (such as building long-term relationships with
customers and focusing on new accounts). Information is shared among users in every
department that touches the customer. Also, information sharing promotes more effective
channel partnership. Salespeople use computers (with communications devices, contact
management programs, and email) to connect them (over the Internet) to their own company’s
databases when they are out on sales calls. This gives them with the ability to provide the
customer with extensive, relevant information almost immediately. Salespeople have access to
current, relevant marketing materials, including data sheets, brochures, multimedia
presentations, and proposal templates, online or via CD-ROM.

OR

• Global Presence- Being a global, it is very necessary to face stiff challenges from global
companies. Due to differences in culture, language and taste and preferences of
customers it is not easy to adopt global condition. So sales force should have well
equipped with improved technology, strategy and operational to upgrade themselves for
international level.

• Innovative technology- Revolution in technology helped companies to communicate

with world-wide customers in ease way. To promote products sales management on
behalf of organization should adopt new innovative technology. So it is important for
sales manager to aware off recent technologies using to get edge in competitions.
PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE
 Sales Management – (18MBAMM401)

• Better Customer Relationship Management (CRM) - Being a successful organization

in today’s competitive world it is necessary to build long-term relationship with
customers. It is less costly to retain an old customer rather than acquiring a new one. So
building up long term relationship will help the organization to know better about needs
and wants of the customers as referral process is very important for the organization. It is
not only building the brand image but also provide favorable condition to operate.

• Diversity among Sales-force- There is always exist diversity between sales-force of an

organization. Sales manager has to accommodate himself with people of different
background within his sales-force.

• Team Based Selling Approach- In recent years it is common approach for the
organization to sell the product as a team to build long-term relationship with potential
customers. It is also very useful when technically complex products are in the process to
sell. Generally sales team consists of top management, inbound and outbound
salespersons, technical specialists etc.

• Ethical and Social Issues- In recent years it is necessary to abide social and ethical
issues such as legal constraints, provide social values to customers’ expectations and
taking part in events related to corporate social responsibilities. Sales manager has to
understand the complex nature of the society and take necessary steps to deal impartially
with various social groups.
• Professionalism within Sales-force- Sales manager should have professional attitude to
process sales operation. As customers are well informed and aware about the market
condition thoroughly so it is necessary to gather knowledge, skills and right attitude to
motivate them. Reliability, professionalism, integrity and thorough market knowledge is
very necessary for today’s competitive world.

LIST OBJECTIVES OF PERSONAL SELLING:

According to Philip Kotler, personal selling is face to face interaction with one or more
prospective purchasers for the purposes of making the sales.”

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

Personal selling is oral communication with potential buyers of a product with the intention of
making a sale.
American Marketing Association defines Personal Selling as “Personal Selling is the oral
presentation in a conversation with one or more prospective purchases for the purpose of making
sales, it is the ability to persuade the people to buy goods and services at a profit to the seller and
benefit to the buyer.”
Objectives of Personal Selling:
• To Creation of Demand
• To Handling Objections
• To Exploring Hidden Words
• To Educating the Customers
• To Build Relationships
• To Provide Feedback.

LIST ADVANTAGES & DISADVANTAGES OF PERSONAL SELLING

Advantages of personal selling:
Following are the advantages of personal selling because of which it is the most commonly used
Promotion tool:
✓ Ability to close sales.
✓ Ability to hold customer attention.
✓ Immediate feedback and two-way communication.
✓ Presentation is tailored to individual needs.
✓ Ability to target customer precisely.
✓ Ability to cultivate relationship.
✓ Ability to get immediate action.

Disadvantages of personal selling

Despite all these advantages of personal selling, it is not without disadvantages because of which
sometimes companies may hesitate to adopt personal selling as a promotion tool.
✓ High cost per contact.
✓ Inability to reach some customers effectively.
✓ Cost of employing sales force
PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE
 Sales Management – (18MBAMM401)

✓ In addition to basic pay incentives are to be provided

✓ Sales person can only call on one customer at a time.

EXPLAIN TYPES OF PERSONAL SELLING:

Personal selling can be broadly classified into three categories.
• Industrial selling
• Selling to reseller
• Selling to business user
• Institutional selling
• Selling to Government
➢ Retail selling
➢ Service selling

DEFINE SALES ORGANISATION

A sales organization defines the duties, roles and the rights and responsibilities of sales people
engaged in selling activities meant for the effective execution of the sales function.
Need of Sales Organization:

LIST OUT THE NEED OR PURPOSE OF SALES ORGANIZATION:

✓ To defines the duties, roles and the rights and responsibilities of sales people
✓ To permit the development of specialists
✓ To assure that all necessary activities are performed
✓ To increase co-ordination and balance
✓ To define authority
✓ To economize on executive time
✓ Establishes Basis of Communication
✓ Defining the sales organization’s objectives.
✓ Defining the various activities that need to be performed to achieve these objectives
and estimating the cost and volume of each of these.
✓ Grouping of the activities and positions.

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

✓ Assignment of personnel to positions.

✓ Control and coordination by formal and informal means.

List the Factors affecting Sales Organization:

1. Product and Service Related Factors
2. Organization – related Factors
3. Marketing Mix-related Factors
4. External Factors

EXPLAIN BRIEFLY THE CONCEPT OF THE SELLING PROCESS/PERSONAL

SELLING
The selling process is generally divided into seven steps that, once you understand them, will
empower you to sell virtually anything you want and satisfy your customers:
 Prospect and qualify
 Pre-approach
 Approach
 Presentation
 Overcome objections
 Close the sale
 Follow-up

Prospect and qualify

• Prospecting is all about finding prospects, or potential new customers. Prospects should
be 'qualified,' which means that they need to be assessed to see if there is business
potential, otherwise you could be wasting your time.
• prospects produced through advertising, referrals, and cold canvassing
• The process of looking for and checking leads is called prospecting or determining which
firms or individuals could become customers
• Before planning a sale, a salesperson conducts research to identify the people or
companies that might be interested in her product.
• A prospect is a lead that is qualified or determined to be ready, willing, and able to buy.

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

pre-approach :The pre-approach is the “doing your homework” part of the process. This
stage involves the collecting of as much relevant information as possible prior to the sales
presentation. The pre-approach investigation is carried out on new customers but also on
regular customers. Systematic collection of information requires a decision about applicability,
usefulness and how to organise the information for easy access and effective use. A good
salesperson researches his prospect, familiarizing himself with the customer’s needs and
learning all the relevant background info he can about the individual or business.

Approach:First impressions (e.g., the first few minutes of a sales call) are crucial to building
the client’s trust. The salesperson should always focus on the benefits for the customer. This is
done by using the product's features and advantages.
First impression is critical;gain attention and interest through reference to common
acquaintances, a referral, or product demonstration
This usually involves introductions, making some small talk, asking a few warm-up questions,
and generally explaining who you are and whom you represent. This is called the approach.
A good approach is crucial to sales success because it will either identify you as a bother some
salesperson and cause a prospect’s guard to go up, or it will identify you as an obliging
salesperson with something of value to offer.

Presentation: The presentation should be tailored to the customer, explaining how the
product meets that person or company’s needs.
It might involve a product demonstration, videos, PowerPoint presentations, or letting the
customer actually look at or interact with the product.
In order to ensure that the presentation is understood by the prospect, the sales person
should be clear in his/her communication.
Presentation should also be interesting enough to keep the attention of the prospect
focused on the proposal.

Handling Objections:The prospect is in fact requesting additional information to help him

to justify a decision to buy. The prospect may not be fully convinced and the issues raised are
thus very important. It also assists the salesperson to establish exactly what is on the prospect's

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

mind.
Some objections may prove too difficult to handle, and sometimes the client may just take a
dislike to you .After you’ve made your sales presentation, it’s natural for your customer to have
some hesitations or concerns called objections. Good salespeople look at objections
as opportunities to further understand and respond to customers’ needs.

Closing the Sale:Eventually, if your customer is convinced your product will meet her needs,
you close by agreeing on the terms of the sale and finishing up the transaction.
Sometimes a salesperson has to make several trial closes during a sales call, addressing further
objections before the customer is ready to buy.

Following Up
• The follow-up is an important part of assuring customer satisfaction, retaining customers
and prospecting for new customers.
• This might mean sending a thank-you note, calling the customer to make sure a product was
received in satisfactory condition, or checking in to make sure a service is meeting the
customer’s expectations.
• Effective sales-follow-up reduces the buyer’s doubt about the product or services and
improves the chance that the person will buy again in the future. In addition to
post-sale activities, sales person are also required to maintain good customer relations.
• Good follow up will double your closing ratio. When a sales person makes contact with a
prospect a relationship has been built, and follow up is how it is nurtured. Staying at the
forefront of a prospect’s mind requires persistence and should not be confused with being
bothersome. This is why it’s important to get agreement on some next step each time there
is contact.

EXPLAIN TYPES OF SALES ORGANIZATION

LINE SALES ORGANISATION
1. The line sales organization is the most basic forms of sales organization, characterized by a
chain of command running from the top sales executive down to the level of the salesman.
2. It is the oldest and simplest sales organizational structure. It is widely used in smaller firms
and in firms with small numbers of selling personnel.

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

3. For instance, in companies that cover a limited geographic area or sell a narrow product line.
4. The chain of command runs from the top sales executives down through subordinates. All
executives exercise line authority, and each subordinate is responsible only to one person on
the next higher level.
5. Responsibility is definitely fixed, and those charged with it also make decisions and take
action. Lines of authority run vertically through the structure. And all persons on any one
organizational level area independent of that level.
6. The line sales organization sees its greatest use in companies where all sales personnel report
directly to the chief sales executive.
7. In these companies this executive often is preoccupied with active supervision and seldom
has much time to devote to planning or to work with other top executives.

Advantages of line organisation Disadvantages of line

organisation

1. Simplicity 1. Lack of specification

2. Division of authority and 2. Over loading

responsibility

3. Unity of control 3. Lack of initiative

4. Speedy action 4. Scope for favoritism

5. Discipline 5. Dictatorial

6. Economical 6. Limited communication

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

7. Co-ordination 7. United administration

8. Direct communication 8. Subjective approach

9. Flexibility 9. Instability

10. Lack of co-ordination

LINE AND STAFF SALES ORGANISATION:

1. Line and staff sales organization is often found in large and medium sized firms, employing
substantial numbers of sales personnel, and selling diversified product lines over wide
geographic areas.
2. Line and staff organizations usually result as the size of the operations grows. It is
characteristically found in medium and large firms which sizeable sales staff selling
diversified product lines.
3. The line and staff department is differentiated by the presence to staff specialists of staff
assistants to advise and assist the top sales executive.
4. These specialists are experts in their own fields which could be sales training, service, sales
analysis and planning, dealer relations, sales promotion, sales personnel development and so
on.
5. While staff executives and assistants do not have the line authority to command, they advise
the line executives through recommendations and provide the benefit of specialization in the
organization.
6. Staff manager don’t have any authority to issue directives to salespeople, who report to line
sales managers.
7. For example, staffs members may be authorized to deal directly with line executive’s
regarding execution of plans and implementation of policies developed by the staff and
approved by management. Although staff members act on behalf of line sales executives in
these instances, they assume joint responsibility for results.

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

Advantages of line and staff organisation Disadvantages of line and staff organisation

Facilitates to work faster and better If powers are not defined then get confusion

Specialization is attained Line officers may reject advice without any

reason for their action

Enables to utilize experience and advice Staff officers are not responsible if favorable
results are not obtained.

Officers can take sound advice Difference between line and staff officers
will defeat the very purpose of specialization

New technology or procedure can be Line officers blame staff officers for
introduced without any dislocation unfavorable results and want to get rewards
for favorable results

Promotes efficient functioning of line

officers

Very good opportunity is made available to

young person to get training

FUNCTIONAL SALES ORGANISATION:

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

1. Some sales departments use Functional sales organization.

2. This type is based upon the premise that each individual in an organization, executive
and employee, should have as few distinct duties as possible.
3. The principle of specialization is utilized to the fullest extent.
4. Duty assignments and delegation of authority are made according to function.
5. In case of functional type of organization it is classified and divided and sub divided on
the basis of functions to be performed.
6. In contrast to the line and staff organization, all specialists in a functional organization
have line authority of a sort or, more properly, they have function authority.
7. Instructions, and even polices, can be put into effect with or without prior approval of
the top level coordinating executive.

Advantages of functional organisation Disadvantages of functional

organisation

o Benefit of specialization o Complex relationship

o Application of expert knowledge o Discipline
o Reducing the work load o Over specialization
o Efficiency o Ineffective co-ordination
o Adequate supervision o Speed of action
o Relief to line executive o Centralization
o Co-operation o Lack of responsibility
o Economy o Increasing the overhead
o Flexibility expenses

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

o Mass production o Poor administration

o Suitability of functional
organisation

MERITS
1. Specialization at different levels.
2. Flexibility of increasing and decreasing of departments as per needs.
3. Quick decision making.
4. Easy co-ordination between sub functions.
DEMERITS:
1. Products do not get due attention.
2. Delay because of sub division of departments.
3. Problem of co-ordination due to increased responsibility of general manager.
4. Conflicts between departments.
5. Effectiveness of organization is badly affected due to malfunctioning of departments.

Qualities of a Sales Manager:

➢ Good communicator, catalyst, and planner.
➢ Skillful manipulator.
➢ Amalgamator, a consolidator, and orchestrator
➢ Successful mentor
➢ Innovator and creator of new ideas and promotion.
➢ Over achiever, rising to the challenge of new forecast each year.
➢ Able to handle unanticipated difficulties and events.
➢ Opportunist and advisor.
➢ Team mate, umpire and referee

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

Responsibilities of Sales Manager:

➢ Sales planning and budgeting
➢ Estimating demand and forecasting of sales
➢ Determination of size and structure of sales organization.
➢ Recruiting, selecting and training of sales force.
➢ Setting sales quota.
➢ Compensating, motivating, and leading sales force.
➢ Analyzing sales volume, cost, and profit.
➢ Measuring and evaluating sales force performance.
➢ Monitoring marketing environment.

EXPLAIN THE SELLING SKILLS

Selling skills are a set of characteristics that are necessary for a salesperson to posses, failing
which he may not be successful in selling.
The essential skills for successful selling are
1. Problem solving skills Communication Skills
2. Selling Skills
3. Negotiation Skills Listening Skills
4. Communication Skills
5. Listening skills
Listening skills: The sales manager has to be a very good listener and use his listening skills
to lead towards sales realization. Poor listening skills may make a sales manager miss subtle
issues in customer interaction and- this may lead to non-resolution of customer’s problems and
thus a poor level of sales realization.
Communication Skills
• The ability and expertise to communicate is necessary in selling function. The salespeople
should posses a good vocabulary and express themselves intelligently to the customer. The
later element is necessary mostly in intelligent buying and selling situations, such as
business to business selling.
• In this case is the salesperson himself, who provides the relevant product and service
information. The source has thoughts and ideas to communicate to the audience, which
have to be encoded in a presentable form by the sender.

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

• Sales presentation, sales literature sent through direct mail, telephone calls and selling
information over the internet are example of communication and information
dissemination in the selling process.

Problem solving skills: The sales person needs problem solving skills for effective selling.
The rational and consultative selling approach suggests that a salesperson should not be a mere
order taker; he should rather act as a problem solver and a consultant to the customer. These
roles are more significant for high-tech selling and business-to-business selling.
A true solver will analyze the situation and extract the real problem from an ocean of
information and facts.
Problem solving Process
• Define the problem
• Generate alternative solutions
• Decide the solution
• Implement the solution
• Evaluate the solution

Decision Skills: Decision skills are the most important because to tackle the questions from
consumers, sales executive should always have the knowledge of competitors’ products and take
a wise decision.
Conceptual selling Skills:
• It is a type of sales technique, which requires the salesperson to first understand their
customer’s issues, i.e., what they are trying to accomplish, fix or avoid.
• Then the salesperson applies his expertise to find a solution for the customer.
• By applying this approach, its helps to build trust with customers and the solution found
becomes difficult for the competitors to replicate.
• Conceptual selling is like introducing a new technology, a revolutionary delivery method,
a different way of serving customers and finding a new way to resolve old problems.

Technical skills :Technical skills are the abilities captured through learning and practice.
They are often job or task specific. In simple words, a specific skill set or proficiency is required
to perform a specific job or task. As a part of conceptual skills, a sales executive should also
PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE
 Sales Management – (18MBAMM401)

have a good grasp on the technical skills of the product.

Negotiation skills: Sales negotiation refers to the mutual discussion between the buyer and
the seller for a transaction or agreement. The negotiation can be a formal event at a specific
date and time. It can also be an ongoing process at different points in sales process
Bargaining is a defined as a process where at least two parties are involved, the parties have
some or one conflict of interest between them, they are atleast temporarily joined together in a
special kind of voluntary relationship and the activity in the relationship concerns the division
or exchange of one or more specific resources or resolution of one or more intangible issues
among the parties

EXPLAIN THE EVOLUTION OF SALES MANAGEMENT

SIMPLE TRADE ERA

The beginning era identified as Simple Trade Era, lasted from the beginning of the
marketing concept to the mid 19th century.
In this period whatever products available were harvested with limited offerings.
Exploration and trade in resources was the focus of the economic activity with
products as center of attraction.

PRODUCTION ERA
The production concept founded on the belief that the customers favor those
PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE
 Sales Management – (18MBAMM401)

products that are highly available and affordable to them. So the concept assumes
that the cheap products are sold well and relies on the improved production and
distribution activities.
Companies try to attain profits by exploiting economies of scale. Improved
production and distribution are emphasized rather than the quality or features of
the product/service. This concept is also known as the manufacturing concept. This
type of strategy for a business works well in the developing countries where the
demand is more than the supply.

1. The era of production orientation was characterized by focusing company

efforts on producing goods or services.
2. More specifically, management efforts were aimed at achieving high
production efficiency, often through the large-scale production of
standardized items.
3. In this situation other functions such as sales, finance and personnel were
secondary to the main function of the business, which was to produce.
4. More importantly, the underlying philosophy was that customers would
purchase products, provided they were of reasonable quality, available in
sufficiently large quantities and at a suitably low price

Product concept
Product concept relies on the assumption that the customers buy those products
that offer the most quality, performance, and innovative features. This concept
suggests that the quality of the product is an important factor in the customer
buying process and customers would always prefer to buy products of superior
quality.
Computer industry is a good example where the production concept worked earlier
but later on product concept took over. Customers required more and more
features and quality while choosing a computer/ laptop. As more and more
companies joined this business and the foreign brands came in the local players

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

had to adopt the product concept.

THE SALES-ORIENTED ERA

This concept relies on the assumption that “We need to compel the customer to
buy the product”, so the customer will buy the product only if the company
aggressively promotes/sells their products/ services. This concept believes that
customer is usually inert and would not buy the product/service if the choice is left
to them. So the company would push its products/services towards the customers
and push them to buy. Hence a strong network of sales force is created for this
purpose and they convince the customers to buy the products/services through
advertising and personal selling. This kind of approach worked well with products/
services like insurance, vacuum cleaners, water purifiers, and various other
household items etc.

MARKETING DEPARTMENT ERA.

The marketing concept underlines the following principles:-
1) Identify the needs and wants of the customer
2) Design the products and services to fulfill the same
3) Use various promotion techniques to communicate the benefits of the product
4) Realizing the profit by satisfying customer needs over a long term.

Relationship marketing concept.

This sub-stage within marketing concept identified as the relationship marketing
concept. The goal of the organization is to build-up a long-term relationship with
customers. The general focus has changed to lifetime customer value and
customer loyalty. Customer relationship management and data-mining become the
buzzwords in recent marketing scenario.

Social/mobile marketing concept

The second sub-stage within the marketing concept is identified as social/mobile

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

marketing concept. It summed-up the knowledge and theories of its predecessor

era but focuses on real-time connections and social exchanges based on build-up
relationship driven by the consumers. In this concept businesses are connected
24/7 to current, future and potential consumers in real time.

MARKETING DEPT ERA

The sales era lasted between 1920’s and 1940’s, emphasized on different
marketing related aspects rather than product only.
As consumer markets were saturated and competitions were increasing day by day
so it was not easy to sell product without providing adequate information about the
brand. Here price became one of the most important features to organizations to
get an edge over their rivals.

Question Bank:

3 Marks:
1. Define sales management.
2. What are sales organization?
7 Marks:
1. What are the major qualities and responsibilities of a sales manager?
2. Mention the various types of selling.
3. What is personal selling? Explain the types of personal selling.
4. Explain the importance of sales management.
5. What are the objectives personal selling?
10 Marks:
1. Bring out the important qualities of sales manager.
2. Elaborate the emerging trends in sales management.
3. Explain the types of sales organization with structure.
4. Discuss the challenges in sales management.

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

UNIT 2: SELLING SKILLS & SELLING STRATEGIES

Selling skills & Selling strategies: Selling and buying Styles, selling skills, situations, selling process,
sales presentation, Handling customer objections, Follow-u action.

EXPLAIN THE SELLING SITUATIONS

A typically selling situation explains
• What kind of customers a salesperson is going to face and
• what kind of customers a salesperson is going to face and
• what kind of sales approach will help him in closing a sale in that situation.
THE SELLING SITUATIONS are as follows
1. Maintenance Selling
2. Developmental selling
Maintenance Selling
• Typically, maintenance selling involves the art of servicing the existing accounts,
securing promotional cooperation, counting inventory and taking replenishment orders,
and delivering the products.
• In the advertising world, these kinds of salespeople are called client servicing executives
who provide service to clients and also take the orders as and when required.
• There is no question of prospecting for this kind of salespeople as it is done with the
exiting customers.
• In the IT sector, these sales people are posted at the client site and are responsible for
solving the client’s problems. In high tech product categories also we find service and
maintenance salespeople.

Developmental selling
• Salespeople engaged in developmental selling are called business developmental sales
executives as they try to contact the potential customers and build business for the firm.
They are the real salespeople who try to do prospecting from the leads either available in
the organization or collected by them and then take the prospect through the whole
process of selling to realize a sale.
• Getting order is the characteristics of development selling
PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE
 Sales Management – (18MBAMM401)

EXPLAIN THE CONCEPT OF SELLING & BUYING STYLE

These two dimensions give rise to the following sales grid, which describes five
styles of selling.
1. Type (1, 1) the order taker
2. Type (9, 1) the hard seller
3. Type (5, 5) the soft seller
4. Type (1, 9) the sell myself and
5. Type (9, 9) the problem solving mentality.

Push the product oriented: The sales people in (9,!) position are more product oriented &
always tries to push the product for sale.
With a high concern for product, and a low concern for people, managers using this style find
customer concern or needs unimportant; they provide their salespeople with money and expect
performance in return. Managers using this style also pressure their employees through rules
PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE
 Sales Management – (18MBAMM401)

and punishments to achieve the company goals.

Take it or leave it :The sales people in (1,1) position are low concern for sales & low concern
for customers oriented .
In this style, managers have low concern for both people and product sales.
Here the sales force believe in displaying the product & assume that customers will buy by it
themselves. This happens when in market there is no more choices for the product categories &
no much product demo. Salespeople or manager use this style to preserve job and job seniority,
protecting them by avoiding getting into trouble. The main concern for the manager is not to be
held responsible for any mistakes, which results in less innovation decisions.

People oriented :The sales people in (1, 9) position are low concern for sales & high concern
for customers oriented .
This style has a high concern for customers and a low concern for sales. Managers or
salespeople using this style pay much attention to the needs and understanding the comfort of
the customer, in hopes that this will increase sales. The resulting atmosphere is able to establish
a personal rapport with customer and realize a sale in future.

Problem solving oriented: The sales people in (9, 9)) position are pay concern for sales &
also for concern for customers oriented .
In this style, high concern is paid both to people and sales. As salespeople are called problem
solver and consult with the customers so that they understand their problem and all his needs &
suggest the product that can solve the problems or needs.
They work with the consumers towards the sound purchase decision on his part that will help
him to get the desired results.

The sales people in (5, 5)) position are balance concern for sales & also for concern for
customers.
In this salespeople uses many sales techniques to do prospecting and presentation & pitch for
sales by applying professional sales techniques.
Managers using this style try to balance between company sales and customers' needs. By
giving some concern to both consumer and product sale, salespeople who use this style hope to

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

achieve suitable performance but doing so gives away a bit of each concern so that neither
production nor people needs are met.

EXPLAIN THE SELLING SKILLS

Selling skills are a set of characteristics that are necessary for a salesperson to posses,
failing which he may not be successful in selling.
The essential skills for successful selling are
1. Problem solving skills Communication Skills
2. Selling Skills
3. Negotiation Skills Listening Skills
4. Communication Skills
5. Listening skills
Listening skills: The sales manager has to be a very good listener and use his listening
skills to lead towards sales realization. Poor listening skills may make a sales manager miss
subtle issues in customer interaction and- this may lead to non-resolution of customer’s
problems and thus a poor level of sales realization.

Communication Skills
• The ability and expertise to communicate is necessary in selling function. The
salespeople should posses a good vocabulary and express themselves intelligently to
the customer. The later element is necessary mostly in intelligent buying and selling
situations, such as business to business selling.
• In this case is the salesperson himself, who provides the relevant product and service
information. The source has thoughts and ideas to communicate to the audience, which
have to be encoded in a presentable form by the sender.
• Sales presentation, sales literature sent through direct mail, telephone calls and selling
information over the internet are example of communication and information
dissemination in the selling process.

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

Problem solving skills:The sales person needs problem solving skills for effective selling.
The rational and consultative selling approach suggests that a salesperson should not be a
mere order taker; he should rather act as a problem solver and a consultant to the
customer. These roles are more significant for high-tech selling and business-to-business
selling.
A true solver will analyze the situation and extract the real problem from an ocean of
information and facts.
Problem solving Process
• Define the problem
• Generate alternative solutions
• Decide the solution
• Implement the solution
• Evaluate the solution

Decision Skills: Decision skills are the most important because to tackle the questions
from consumers, sales executive should always have the knowledge of competitors’
products and take a wise decision.

Conceptual selling Skills:

• It is a type of sales technique, which requires the salesperson to first understand
their customer’s issues, i.e., what they are trying to accomplish, fix or avoid.
• Then the salesperson applies his expertise to find a solution for the customer.
• By applying this approach, its helps to build trust with customers and the solution
found becomes difficult for the competitors to replicate.
• Conceptual selling is like introducing a new technology, a revolutionary delivery
method, a different way of serving customers and finding a new way to resolve old
problems.

Technical skills :Technical skills are the abilities captured through learning and practice.
PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE
 Sales Management – (18MBAMM401)

They are often job or task specific. In simple words, a specific skill set or proficiency is
required to perform a specific job or task. As a part of conceptual skills, a sales executive
should also have a good grasp on the technical skills of the product.

Negotiation skills: Sales negotiation refers to the mutual discussion between the buyer
and the seller for a transaction or agreement. The negotiation can be a formal event at a
specific date and time. It can also be an ongoing process at different points in sales process
Bargaining is a defined as a process where at least two parties are involved, the parties
have some or one conflict of interest between them, they are atleast temporarily joined
together in a special kind of voluntary relationship and the activity in the relationship
concerns the division or exchange of one or more specific resources or resolution of one or
more intangible issues among the parties

EXPLAIN THE METHODS OF PROSPECTING

1. Make warm calls:
2. Advertisements and Advertising Agencies:
3. Direct Mail and Telephone Method:
4. Exhibitions and Demonstration:
5. LISTS AND DIRECTORIES:
6. Spotters(bird dogs.):
Make warm calls: Your initial contact with new prospects doesn't have to be -- and in fact,
shouldn't be -- completely cold. It can be incredibly useful to warm up your prospects
before making the initial contact. You can increase your chances of a warmer reception by
familiarizing the prospect with your name or your company affiliation before you make
your first call or send your first email. A few ideas as to how to achieve this: get introduced
by a shared connection, comment on a piece of content the buyer shared on social media.
Advertisements and Advertising Agencies: Today, spending on advertisements is
increasing as it yields good results. It is an investment rather than expenditure. A well
designed and placed advertisement brings good many prospects. What salesman does by
PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE
 Sales Management – (18MBAMM401)

personal efforts is done by each advertisements as it has need recognizing and need
converting capacity at quickest span this has become much easier because of audiovisuals.
In addition to these advertisements proper, the agency or the advertising department of
the business house to provide the list of leads to the salesman that enriches his reservoir of
prospects.
Direct Mail and Telephone Method: The salesman contacts the former and present users
of the products by mail. The contact message covers the arrival of new products. Circular
and sales letter along with advertising folders are sent to both old and present and likely
customers depicting the latest features of the new line, advantages of new line and the
benefits of the new line. This direct mail approach needs a selected mailing list which is up-
dated. This is better than personal call, because it select best, uncovers the unknown
prospects and makes prospect need-conscious. In addition, telephone contacts can be
established particularly, in city areas. It is a great time saver and has the same effect as that
of a personal call. Constant contact is possible with past, present and potential customers.
Exhibitions and Demonstration: Exhibitions and demonstrations take place from time to
time at city, regional or national or international level. The selling houses sponsor such
trade-shows and demonstrations along with sales staff. As the visitors walk into the
pavilion to examine the products, an experienced salesman takes a few minutes to qualify
leads, gets their names and addresses so as to contact them later on either at their homes
or offices for demonstration. Though salesman and prospect contact is a quite brief, this
type of gathering of special interest gives salesman extensive contact with a large number
of potential buyers over a very short span of time.
LISTS AND DIRECTORIES: Individual sales representatives can develop prospect lists
from sources such as public records, telephone directories, chamber of commerce
directories, newspaper, trade publications, club membership lists, and professional or
trade membership lists. Secondary sources of information from public libraries also can be
useful. Salespeople can purchase a number of prospecting directories and lead generating
publications.
Spotters(bird dogs.):Some salespeople use spotters, also called bird dogs. These
PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE
 Sales Management – (18MBAMM401)

individuals will, for a fee provide leads for the salesperson. The sales rep sometimes pay
the fee simply for the name of the lead but more often pays only if the lead ends up buying
product or service. Spotters are usually in a position to find out when someone is ready to
make a purchase decision

WHAT ARE THE IMPORTANCE OR NEED OF PREAPPROACH

1. Saves time, effort & energy
2. Prior understanding of prospects
3. Lessen the possibilities of mistakes
4. Ease in prospect handling
5. Provide the information of prospects beforehand
6. Gives confident & enthusiastic approach.
7. Distinguish most likely &other prospects.

WHAT IS THE SIGNIFICANCE OF DEMONSTRATION?

1. Highlights specific features
2. Provides opportunity of comparison
3. Experience the benefits
4. Lessens sales resistance
5. Quenching the customer curiosity
6. Creates impression

WHAT ARE THE METHODS OF HANDLING CUSTOMER OBJECTIONS

• Superior feature method
• Comparison method
• Another angle method.
• Narrative method
• Testimonial methods
• Ye s…but method
PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE
 Sales Management – (18MBAMM401)

• Direct denial method

1. Superior feature method

This method allows the salesperson to accept the objections & persuade the
customers through providing additional benefits of his product, which may
compensate the objections raised by consumer, thus allowing him to buy the
product.
2. Comparison method: Salesperson Demonstrate similar product of the other
producers before the customer & tries to remove the objections by comparing the
benefits of his product with those of others.
3. Another angle method.
Sales person advices the customers to look from another angle , which is +ve for the
product, rather than making looking at it from a negative angle.
4. Narrative method
In this salesperson uses a story to remove customer objections.
5. Testimonial methods
Salesperson presents the sales message by referring to celebrities & persons of
importance as the users of the product.
6. Ye s…but method
This is an ancient method of handling objections in which the salesperson agrees
with objections at the beginning & then slowly makes an effort to remove the
objections from the customers mind by tactful handling of the arguments.
7. Direct denial method
In this salesperson rejects the customer objections outright. He turns down the
customer objections by calling them absolutely wrong, & then builds up his
presentation.

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

UNIT 3: MANAGEMENT OF SALES TERRITORY & SALES QUOTA:

Sales territory, meaning, size, designing, sales quota, procedure for sales quota. Types of sales quota,
Methods of setting quota. Recruitment and selection of sales force, Training of sales force

1. DEFINE SALES QUOTA

Sales quota can be defined as the sales target, which is assigned to any sales unit for a particular
duration of time; here sales unit can be a person, region, distributor etc.
Sales quota provides a target to be achieved in particular duration, which increases the
productivity.
Or
A sales quota is a quantitative goal assigned to a sales unit relating to a particular period of time.
Sales quotas plan, direct, control and evaluate the activities of a company and their effectiveness
depends upon the kind. Quantity and accuracy of marketing information used in setting them
depends upon the management’s skill in administering the quota system.
Sales quota is determined using various factors such as market potential, marketing method, past
sales record etc., with effective projection of market sentiments.

2.WHAT IS THE PURPOSE OF SALES QUOTAS

• Controlling salesperson’ activities
• Quotas provide opportunities
• To direct and control the selling activities of salespersons
• To control the calls per day
• To gain new accounts
• To plan demonstrations
• To realize money from account holders
• To take corrective actions if salespersons fail to achieve their targets
• To evaluate the performance of salespersons

3.WHAT ARE THE OBJECTIVES OF SALES QUOTA

Sales quota is imposed in an organization to fulfill various objectives required to increase
the sales of product and maximize profit.

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

Sales objectives help an organization in the following ways:

1. They provide a standard to measure the performance.
2. They help to control sales expenses for customer acquisition.
3. They help define a target; this further facilitates motivation and enhanced performance.
4. These help to identify and monitor the performance of salespersons

4.EXPLAIN THE TYPES OF SALES QUOTA.

1. Sales and Volume Quota
2. Financial and Budget Quota
3. Activity Quota
4. Combination Quota
Activity quotas
• It set objectives for job-related duties useful toward reaching salespeople’s performance
targets.
• Activity quota is planned on the basis of these activities performed by the salesperson. By
setting quota for the activities, efficient performance and controlling can be managed.
• In competitive market, the effective performance of sales group is required. It can act as a long
term benefit for the organization. Organizations set up activity quota for sales force for
efficient results. These can be performed by allocating sales target to salespersons.
The following are the activities listed under sales quota:
• Number of accounts opened through the salesperson
• Number of sales calls made to potential customer
• Number of demonstrations made to show the product
• Number of maintenance activities performed

Expense quotas
• This is the amount of expense that can be incurred by a salesman in carrying out his duties
in a particular region over a period of time.
• To keep the selling cost within reasonable limits, quotas are linked with different levels of
sales attained by the sales force and to ensure its conformity, they link compensation
incentives to keep expenses within prescribed limits

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

• This are aimed at controlling costs of sales units. Often expenses are related to sales volume
or to the compensation plan.
• Financial and budget quota is used to determine and restrict expenses on sales to attain
desired net profit planned.
• It is implemented on various segment of sales organization to control the expenses
accordingly.
• The aim of these quotas is restriction of expenses for making sales so that profit can be
increased.

Sales and Volume Quota

• Sales and volume quota is allocation of sales quantity for salesperson, geographical regions,
distribution outlets etc. This quota can be implemented according to sales performed or
revenue earned by respective units.
• The combination of both the criteria can also be used for the implementation of this quota.
The quantity of sales and revenue earned can be allocated to the respective unit
(salesperson, region) and it has to fulfill at least one of them.

Combination Quota
It depends on product type and market condition, issues related to sales of product and the
challenges faced during the sales of a product. Organizations set up quota with combination of
sales volume and activity quota in order to increase sales.

5. EXPLAIN THE METHODS OF SETTING SALES QUOTAS

Methods of setting sales quota
1. Quotas based on sales forecasts and Potentials
2. Quotas based on forecast
3. Quotas based on past sales or experience
4. Quotas based on executive judgment
5. Quotas based on salesperson judgment
6. Quotas based on compensation

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

Past Sales Experience Method

• Past sales experience method determines the sales quantity based on the previous year
sales.
• Sales quotas are set based solely on past sales experience.
• Managements of organizations set this up by increasing some percentage from the previous
sales record.
• For more precision in the approach, managements most commonly use an average of
several years as a base line for the measurement. This method is simple and doesn’t take
much effort to implement.

Sales People Estimate Method

• In this method, the sales quota is determined by the salesperson of the organization.
• Through this approach, a more relevant sales estimate can be maintained, which can be
achieved by the salesperson.
• Salesperson have better knowledge of the market conditions, so they can set the target as
per their standards, and if the standards are set by the salesperson themselves rather than
imposed by the management, their fulfillment is more likely possible.

Executive Judgment Method

• In this method, sales quota volume is determined by the management, but it is more likely
to be a guess. The management decides the sales quantity and no fixed procedures are
involved.
• This method is not precise and it’s mostly not used by organizations to determining the
sales quota. This method doesn’t provide any estimate for territorial based sales volume.

Territory Potential Method

• Territory potential method directly relates territorial sales potential to sales quota. The
potential here is total industry’s sales for that segment. Sales potential represents the
maximum market size of the product; size of the market reflects the sales potential.
• This method gives precise results if territorial sales potentials are used with a combination
of territorial design.
PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE
 Sales Management – (18MBAMM401)

• Quotas Based on Sales Forecasts and Potentials: Large organizations set quota on the basis
of sales forecasts and the sales potential of the market and the territory. Organizations forecast
the total sales or volume for the entire market, which is then divided into territories, and then
brought down to the individual salesperson level. The forecasts can be generated at the
corporate level, at the total product line level, and at the individual products level.
• Quotas Based on Forecast: It is not always possible to obtain the forecasted figures for
individual sales territories as companies lack information, data, money, and people to determine
the sales potential for individual sales territories. Small companies set quota in

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

relation to their sales forecast or total market estimate. They establish quota on the basis of the
past performance in geographic areas without regard to the sales potential.
• Quotas Based on Past Sales or Experience: Some companies could not make the sales
estimates in advance for the total market. In such cases, companies collect the sales data of the
previous years, average them out for each geographic territory, and then add an arbitrary
percentage for next year’s quota. A few companies set quota based on average sales of longer
periods. This average method is followed due to the ease of using the trends and projecting
them for future.
• Quotas Based on Executive Judgment: This method is used when there is little or no
information available about the market. It may also be impractical to find out the potential of a
new product in an existing territory or an existing product in a new territory. So managers have
to rely on their past experience for making future predictions. They try to analyse facts and
figures for the different markets and then decide the quota for the territory, salesperson, and
intermediaries.
• Quotas Based on the Judgment of Salespeople: Many companies ask their own salespeople
to set the quota for themselves. This is mostly applicable in situations where the company is
expanding the territory or starting up its own sales force. In these situations, it is difficult to
project sales even though there may be significant sales potential. Most companies allow their
salespeople to give data to set their quota. Many companies also use these inputs from the
salespeople to fix their production and manufacturing schedules.
• Quotas Based on Compensation: Salespeople are promoted on the basis of their achieving
quota. It is like a bottom line for the salespeople. Salespeople are evaluated on the basis of their
attaining quota for higher assignments. Salesperson gets extra compensation by reaching sales
volume quotas for total unit or rupee sales, and sales of existing products and new products.

5. DEFINE SALES TERRITORY

• A sales territory consists of a group of consumers or a geographical area assigned to a
particular salesperson. The area allocated to the salesperson contains the present and the
potential consumers of the organization.
• A sales territory is composed of a group of customers or a geographic area assigned to a
salesperson.

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

• After the allocation of sales territory, the sales manager can be in a position to contest
between sales efforts and sales opportunities. It would be very difficult for the sales
manager to monitor the total market as it is too large and unmanageable by one person.

6. EXPLAIN THE REASONS FOR ESTABLISHING TERRITORIES

1. To better, regular, planned customer coverage.
2. To establish the salesperson’s job and responsibilities
3. To evaluate sales performance
4. To improve customer relations
5. To reduce sales expenses
6. To improve control of the sales force
7. Adequate market coverage .
8. To Maximized sales.
9. Time management and control selling/ travelling expenses.
10. Evaluation of field force performance.
11. Avoid repetition.
12. Better clarity of coverage
13. To coordinate selling with other marketing functions

To obtain thorough coverage of the market

According to the division of sales territory, the activities are assigned to salesperson.
This helps in market coverage, rather than the salesperson selling the product according to his
ambition. It helps the sales manager to monitor and take updates accordingly from different sales
managers.

To establish the salesperson’s job and responsibilities

It’s very important to establish jobs and responsibilities for salespersons. Sales territories help in
doing so because the task is assigned to the salesperson and he is responsible and answerable for
the same.
Once the task is assigned, frequent checks are done to monitor the calls; it helps to determine the
work of each salesperson. If the sales manager finds the workload for a particular person is more,

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

the work is divided and reassigned equally. This creates motivation and interest to work.

To evaluate sales performance

In an organization, the sales territory is compared from the previous years to current to find out
the difference, i.e., the increase or decrease in sales volumes. It helps to work on the difference
accordingly. This is done with the help of sales territory as the activities are assigned in a proper
manner and gathering of data and evaluation becomes easy.
The comparison to evaluate sales performance is done on the following basis:
• Individual to District
• District to Regional
• Regional to Entire Sales Force
By this comparison, we can evaluate and determine where the sales force is contributing for high
volume of sales.

To improve customer relations

As we know, salespersons have to spend most of their time on road to sell the products but if the
sales territory is designed in a proper way, the salesperson can spend more time with the
customers (present and potential). This helps in building rapport and understanding the needs
better.
Sales of a company can increase when a customer receives regular calls and the salesman has to
visit the customers on the basis of calls. The salesman and the customer get time to understand
each other and resolve their issues regarding demand and supply. This also helps in increasing the
brand value of the company.

To reduce sales expenses

Once the geographical areas are decided, the company gets a proper picture as to the areas that can
be assigned to the salespersons. He/she needs to cover that area so that there is no duplication of
work by sending two salespersons in the same area.
The selling cost of the company gets reduced and leads to increase in profits. There is also an
advantage to the salesperson for few travels and overnight trips.
To improve control of the sales force

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

The performance of a salesperson can be measured on the basis of calls made to customers, the
routes taken and the schedules. In this case, the salesperson cannot deny if the results are not
positive.
The salesperson has to work on the same routes, schedule and everything is predetermined. This
results in better control of the sales force.
To coordinate selling with other marketing functions
If the sales territory is designed properly, it helps the management to perform other marketing
functions as well. It is easy to perform an analysis on the basis territory as
compared to the entire market.
The research done by the management on marketing on territory basis can be used to set sales
quotas, expenses and budgets. The results can be satisfactory if the salesperson helps in
advertising, distribution and promotion when the work is assigned on territory basis instead of the
market as a whole.

7.LIST OUT THE FACTORS TO CONSIDER WHEN DESIGNING TERRITORIES

1. Select the basic control unit
2. Analyze workload
3. Determine basic territories
4. Assign territories
5. Geographic area.
6. Business potential.
7. Workload.
8. Travel time & Expenses.
9. Frequency of callage & Productivity.
10. Service requirement.
11. Competition.
12. Seasonality.
13. Profitability.

9. EXPLAIN THE CONCEPT/Procedure OF DESIGNING THE SALES TERRITORY

1. Select the basic geographic control units

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

2. Decide on the criteria for allocation

3. Decide on the starting point
4. Combine control units adjacent to starting point
5. Compare territories on allocation criteria and conduct workload analysis
6. Assign sales force to new territories

Procedure for Designing / Setting Up Sales Territories

• Selection of Basic Geographical Control Unit: Basic units are smallest part of sales
territories. A sales territory is formed by combining a number of basic units. The basic units
are also called basic geographical control units. The selection of basic geographical control
units is an important step in establishing sales territories. Care should be given in selecting
these units to reasonable size so as to achieve economy. At the same time, it is necessary that
the units should homogenous. The basic units may be a country, state, district or a trading
area.
• Determining Sales Potentials on the Basic Units: The next step after selection of basic
control units is to determine the sales potentials in the control units. For this purpose, the
managers have to identify the present and prospective customers with certain information
about sex, age group, likes and dislikes, requirements, standard of living, income, etc.
• Combining the Basic Units into Tentative Sales Territories: After ascertaining the sales
potentials in control units, the planners should form tentative sales territories. For this purpose,
the basic units are combined together so that the sales potentials may be converted into sales.
At this level, sales territories are made tentative so that necessary adjustments could be
possible in future on the basis of coverage problem. Care should be given to form optimum
size of territories.
• Adjusting and Redistributing Sales Territories: In this process, sales territories are given
final shape by adjusting and redistributing the tentative territories. This adjustment is made
keeping in view of sales potential and problem of coverage. At the same time care should be
given that the sale expenses of each sale territory are uniform so as to establish formation of
sound sales territories.
• Assigning Sales Territories to Salespersons: On determination of final form of sales
territories after making necessary adjustment in tentative sales territories, the setting activity
begins. For this purpose, suitable salesmen are appointed and each territory is assigned to the
PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE
 Sales Management – (18MBAMM401)

persons, keeping in view of the characteristics of each territory. In addition to the salesmen,

middlemen are also appointed, keeping in view of needs of each territory. With the help of
salesman and middlemen, the sales procedure starts from each territory.

10. DEFINE RECRUITMENT

Recruitment is the process of finding and hiring the best-qualified candidate (from within or
outside of an organization) for a job opening in a timely and cost-effective manner. It is the planned
process whereby the scientific principles of management is utilized for finding out and filling up
the positions in the right territory with the right people.

11. EXPLAIN THE MAIN SOURCES OF RECRUITMENT.

Internal Recruitment External Recruitment
Promotion Management Consultant
Departmental Exam Employment Agencies
Transfer Campus Recruitment
Retirement News Paper Advt
Internal Advertisement Internal Advt
Employee Recommendation Walk In

Sources of Recruitment of Employees:

1. Internal and
2. External Sources
Internal sources
1. Transfers:
Transfer involves shifting of persons from present jobs to other similar jobs. These do not involve
any change in rank, responsibility or prestige. The numbers of persons do not increase with
transfers.
2. Promotions :It refer to shifting of persons to positions carrying better prestige, higher
responsibilities and more pay. The higher positions falling vacant may be filled up from within the
organization. A promotion does not increase the number of persons in the organization.

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

3. Internal Advertisements:
The company may also display on its notice boards or inform the departmental head of a vacancy
at executive levels. Accordingly, interested candidates may apply for the position.
Retrenched or Retired Employees:
Employees retrenched due to lack of work are given employment by the organization due to
obligation, trade union pressure etc. Sometimes they are re-employed by the organization as a
token of their loyalty to the organization or to postpone some interpersonal conflicts for
promotion

External Sources: It refers to sources from outside the company.

Advertisements:
This is one of the most popular sources of recruitment. Advertisement of the vacancy can be
inserted in newspapers, or business magazines. The ads can also be placed on the job related web-
sites on the internet.
Campus Recruitment:
The company may also inform management institutes to send candidates studying management
courses in such institutes. At times the company recruitment committee may personally visit the
institute campus and recruit and candidates. There can be recruitment of summer trainees who are
presently studying in various institutes.
Recommendations: The company may also recruit executives on the basis of recommendation
received from existing managers or from sister concerns.
Internet ads: In the age of globalization prospective candidates for specialized jobs in large
organizations, especially MNCs may be attracted through internet ads. Such ads do have world
wide access to highly qualified people having internet connections.
Unsolicited Applicants / Walk – ins:
Companies generally receive unsolicited applications from job seekers at various points of time.
The number of such applications depends on economic condition, image of the company and job
seeker’s perception of the types of jobs that may be available, etc. such applications are generally
kept in a data bank and whenever suitable vacancy arises, the company would intimate the
candidate to apply through formal channel.
12. LIST OUT THE ADVANTAGE & DISADVANTAGES OF INTERNAL RECRUITMENT

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

ADVANTAGES DISADVANTAGES
1. Improves morale: 1. Internal recruitment has no more scope.
2. Internal recruiting has a lower cost to the 2. Discourages capable persons from outside to
company join the concern.
3. No Error in Selection 3. It prevents new blood from entering
4. Saves times in training organization.
5. Improves self motivation & beliefs 4. Current employees those who are not
6. Promotes Loyalty: promoted may be affected.
7. No Hasty Decision 5. Jealousness & dissatisfaction develops among
8. Economy in Training Costs workers who are not recruited
9. Self-Development: 6. Old workers lacks motivation & enthusiasm
7. For posts requiring innovations and creative
thinking, this method of recruitment cannot be
followed.

13. LIST OUT THE ADVANTAGE & DISADVANTAGES OF EXTERNAL RECRUITMENT

Advantages Disadvantages
1. Benefits of new skills and talents 1. It is costly method
2. Benefits of new experiences 2. Demoralization of present employee
3. fulfillment with reservation policy becomes 3. Lack of cooperation
easy 4. Problems of maladjustments
4. Scope for resentment, jealousies, and 5. Chances of creeping in false positive and false
heartburn are avoided. negative errors
5. Better morale and motivation associated 6. Adjustment of new employees takes longer
with internal recruiting is denied time.

14. EXPLAIN THE PROCESS OF RECRUITMENT

1. Conducting a job analysis
2. Preparing a job description

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

3. Developing a set of job qualifications

4. Attracting a pool of applicants

Conducting a job analysis :Before a company can search for a particular type of salesperson, it
must know something about the sales job to be filled. To aid in the process, a job analysis should be
conducted to identify the duties, requirements, responsibilities, and conditions involved in the job.

Preparing a job description:The result of a formal job analysis is a job description. Since a job
description is used in recruiting, selecting, training, compensating and evaluating the sales force,
the description should be in writing so that it can be referred to frequently. The written job
description lets prospective job applicants, as well as current sales personnel, know exactly what
the
duties and responsibilities of the sales position are and on what basis the new employee will be
evaluated.

Developing a set of job qualifications: The duties and responsibilities set forth in the job
description should be converted into a set of qualifications that a recruit should have in order to
perform the sales job satisfactorily. Determining these qualifications is probably the most difficult
aspect of the entire recruitment process. One reason is that the manager is dealing with human
beings; therefore, a multitude of subjective and very complex characteristics are involved. Specific
qualifications such as education and experience should be included in the job qualification, thus
making good candidates easier to identify. But most firms also try to identify
personality traits that presumably make better salespersons, such as self-confidence,
aggressiveness, etc

Attracting a pool of applicants: The next major step in the recruitment process is attracting a
pool of applicants for the sales position to be filled. All large companies with a sales force have a
continuous need to identify, locate, and attract potentially effective salespeople. The candidates
recruited become the reserve pool of sales staff from which new salespeople will be chosen. The
quality of this group will predict the future successes or problems of the sales organization.

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

15. DEFINE SELECTION

Selection is the process of making a ‘hire’ or ‘no hire’ decision regarding each applicant for a job.
The selection process involves choosing the candidates who best meet the qualifications and have
the greatest aptitude for the job.

16. EXPLAIN BRIEFLY SELECTION PROCEDURE

1. Inviting applications:
2. Receiving applications:
3. Scrutiny of applications:
4. Written tests:
5. Psychological tests:
6. Personal interview:
7. Reference check:
8. Medical examination:
9. Final selection:

1. Inviting applications: The next step is to advertise the job. The job can be advertised through
various media. The right details about the job and the candidate must be given in the
advertisement.
The prospective candidates from within the organization or outside the organization are called for
applying for the post. Detailed job description and job specification are provided in the
advertisement for the job. It attracts a large number of candidates from various areas.
2. Receiving applications:
Detailed applications are collected from the candidates who provide the necessary information
about personal and professional details of a person. These applications facilitate analysis and
comparison of the candidates.

3. Scrutiny of applications:
The initial screening can be done of the applications and of the applicant. Usually, a junior
executive does the screening work. At this stage, the executive may check on the general
personality, age, qualifications, family background of the candidate. The candidate may also be
informed of salary, working conditions, etc.
As the limit of the period within which the company is supposed to receive applications ends, the
applications are sorted out. Incomplete applications get rejected; applicants with un-matching job
PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE
 Sales Management – (18MBAMM401)

specifications are also rejected.

4. Written tests:
As the final list of candidates becomes ready after the scrutiny of applications, the written test is
conducted. This test is conducted for understanding the technical knowledge, attitude and interest
of the candidates. This process is useful when the number of applicants is large. Many times, a
second chance is given to candidates to prove themselves by conducting another written test.
5. Psychological tests:
These tests are conducted individually and they help for finding out the individual quality and skill
of a person. The types of psychological tests are aptitude test, intelligence test, synthetic test and
personality test
6. Personal interview:
It is face to face exchange of views, ideas and opinions between the candidate and interviewer(s).
There are various types of interviews such as :
(a) Panel Interview, (b) Individual Interview, (c) Group Interview, (d) Stress Interview, (e) Exit
Interview.
Candidates proving themselves successful through tests are interviewed personally. The
interviewers may be individual or a panel. It generally involves officers from the top management.
The candidates are asked several questions about their experience on another job, their family
background, their interests, etc. They are supposed to describe their expectations from the said
job. Their strengths and weaknesses are identified and noted by the interviewers which help them
to take the final decision of selection.
7. Reference check: Generally, at least two references are asked for by the company from the candidate.
Reference check is a type of crosscheck for the information provided by the candidate through their
application form and during the interviews.

8. Medical examination: Physical strength and fitness of a candidate is must before they takes up the job.
In-spite of good performance in tests and interviews, candidates can be rejected on the basis of their ill
health.
Medical examination of the candidates is undertaken before they join the firm in order to Find out
whether the candidate is physically fit to carry out duties and responsibilities effectively, Ensure
the health and safety of other employees, Find out whether the candidate is sensitive to certain
work place such as in a chemical factory
PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE
 Sales Management – (18MBAMM401)

Final selection: At this step, the candidate is given the appointment letter to join the organization
on a particular date. The appointment letter specifies the post, title, salary and terms of
employment. Generally, initial appointment is on probation and after specific time period it
becomes permanent.

10. Placement: This is a final step. A suitable job is allocated to the appointed candidate so that they can get
the whole idea about the nature of the job. They can get adjusted to the job and perform well in future with
all capacities and strengths.

17. WHAT’S THE NEED OF SALES TRAINING

1. Increase productivity
2. Higher sales volume.
3. Better product knowledge
4. Develops high morale
5. Create positive attitudes/improve morale
6. Improved customer relations
7. Reduce role conflict and ambiguity (turnover)
8. Improve efficiencies (time and territory)
9. Introduce new products, markets, or programs
10. Improve selling skills

18. WHAT ARE THE OBSTACLES OF SALES TRAINING?

1. Training is expensive
2. Top management is not dedicated to sales training
3. Sales people are lack of understanding about training accomplish or outcome.
4. Lack of appropriate knowledge of training needed for salespeople

19.EXPLAIN THE METHODS OF SALES TRAINING

1. On the Job Training Methods
2. Off-the-job Training Methods

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

On the Job Training Methods OFF THE JOB TRAINING

1. Job Rotation: 1. Lectures
2. Job Instructional Technique (JIT): 2. Conferences –
3. Coaching: 3. Role Play: -
4. Apprenticeship 4. Brainstorming method
5. Internship training 5. Discussion method
6. Audio-visual method.

ON THE JOB TRAINING METHODS

This are by far the most commonly used in training for all levels of personnel. The object of on the
job training is to bring the employees to at least a minimum acceptable standard of performance in
the shortest possible lime. The worker by these methods learns to master the operations involved
on the actual job situation under the supervision of his immediate loss that has to carry the
primary burden of conducting this training.
Job Rotation:
It is the process of training employees by rotating them through a series of related jobs. Rotation
not only makes a person well acquainted with different jobs, but it also alleviates boredom and
allows to develop rapport with a number of people. Rotation must be logical.
Job Instructional Technique (JIT):
It is a Step by step (structured) on the job training method in which a suitable trainer (a) prepares
a trainee with an overview of the job, its purpose, and the results desired, (b) demonstrates the
task or the skill to the trainee, (c) allows the trainee to show the demonstration on his or her own,
and (d) follows up to provide feedback and help.
Coaching:
Coaching is a one-to-one training. It helps in quickly identifying the weak areas and tries to focus
on them. It also offers the benefit of transferring theory learning to practice.

OFF THE JOB TRAINING

Lectures
• Lectures and conferences are the traditional and direct method of instruction. Every training
programme starts with lecture. It’s a verbal presentation for a large audience.

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

• However, the lectures have to be motivating and creating interest among trainees. The speaker
must have considerable depth in the subject. In the colleges and universities, lectures and
seminars are the most common methods used for training.

Conferences –
• A conference is a formal meeting conducted in accordance with an organized plan, in which the
organizers seek to develop knowledge and understanding by obtaining considerable
participation of trainees. A subject matter is deliberated by the participants.
• The trainees explain the facts, principles or concepts and discussion takes place. The trainees
pool their knowledge and try to find solution to the problem or develop new ideas as per the
inference of the discussion.
• This method is suitable for analyzing problems and issues and examining them from different
viewpoints. It is sound method for the development of conceptual knowledge and finding
solutions to specific problems.
• In this method, the participants pool their ideas and experience in attempting to arrive at
improved methods of dealing with the problems which are common subject of discussion)
Conferences may include buzz sessions that divide conferences into small groups of four or five
for intensive discussion. These small groups then report back to the whole conference with
their conclusions or questions. Conference method allows the trainees to look at the problem
from a broader angle

Discussion method
• Here the actual or imaginary case is given as a problem to be solved to different group or
trainees.
• Each group or trainee has to understand the problem & draw a solution or conclusion to the
given problem.
• After this suggestions & conclusions are analyzed and under the leadership of the instructor &
this enables training the salesmen in correcting their views.

Role Play: -
• Its just like acting out a given role as in a stage play.

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

• Is the method of human interaction that involves realistic behavior in imaginary situations
• In this method of training, the trainees are required to enact defined roles on the basis of oral
or written description of a particular situation.
• Developing interpersonal skills and communication skills
• It helps in better Group decision making
• Developing insight into one’s own behavior and its impact on others

20.LIST OUT THE CHALLENGES OF SALES TRAINING

1. Lack of management support
2. Lack of In-house Expertise:
3. Participants who have no idea why they are in the training
4. Management with different expectations on training outcomes.
5. Inconsistent Training:
6. Lack of training awareness & its need
7. Flexible and Mobile Workforce
8. Shortages of experts & trainers
9. Loss of sales during training period
10. Big challenge is to provide the employees with up-to-date knowledge
11. Lack of interest of trainees & trainers
12. Its costly to implement & time constraint
13. Shortage of training facilities in company

21.EXPLAIN TRAINING PROCESS(ACME)

1. AIM OF TRAINING(A)
2. CONTENT OF TRAINING(C) (training about product,company,sales policies, reporting)
3. METHODS OF TRAINING(M)
4. EVALUATION OF TRAINING(E) (Changes in response,lerning,behavior & results)

List out the factors considered for designing the Size of Sales Territories will be fixed on the basis
of (factors to be considered):
• Nature of the product

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

• Demand for the product

• Transport facilities
• Competition & frequency of contact
• Population
• Advertising & sales promotion activities
• Ability & experience of sales man

Explain the concept of Managing of Sales Territory:

It means “How salesperson should cover the assigned sales territory”. It includes three tasks for a
sales manager:
• Planning efficient routes for salespeople. (Routing)
• Scheduling salespeople’s time. (Scheduling)
• Using time-management tools. (Time Management)

➢ Routing: Routing is a travel plan or pattern used by a salesperson for making customer calls in
a territory. The main advantage of routing is:
o Reduction in travel time and cost and increase selling time
o Improvement in territory coverage
o Identify the present and potential customers on a territory map
o Classification of Customers in to High, Medium &Low Sales Potential
Routing Plan: Routing plans are made based on the information such as numbers and
locations of customers, means and methods of transports, the desired call rates, detailed maps
showing important towns and cities, connecting routes like air, road, water ways and the
border of territories and other major landmarks.

➢ Scheduling: Scheduling refers to establishing a fixed time when the salesperson will be at a
customer’s place of business. It is planning a salesperson’s specific time of visits to customers;
strict formal route designs enable the salesperson to:
o Improve territorial coverage
o Minimize wasted time
o Establish communication between management and the sales force in terms of the
location and activities of individual salespeople.
PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE
 Sales Management – (18MBAMM401)

Call Scheduling: Call scheduling is more difficult than route planning. Based on desired call
frequency rate for each customer on the route, call schedule is easily made as part of routing
plan. It is impossible to set up fixed routing and scheduling plans.

List the Objectives of Routing and Scheduling of Sales Personnel:

• To maximize sales by minimizing wastage of time by sales personnel.
• To establish and maintain line of communication.
• To know the whereabouts of sales person.
• To improve sales coverage.
• To reduce non-selling time.
• To avoid back tracking.
• To improve size of average sales order.
• To improve profit.

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

UNIT 4: SALES FORCE MOTIVATION AND COMPENSATION:

Nature of motivation, Importance, Process and factors in the motivation, Compensation-Meaning,
Types of compensation plans and evaluation of sales force by performance and appraisal process.
Sales management job: Standard sales management process-international sales management -
international market selection market survey approach or strategy.

DEFINE MOTIVATION
Motivation is an internal feeling and an energetic force within salespeople that drives them to
behave in a certain way. It produces goal-directed action harnesses human energy towards the goals of
the sales organization.

The main objectives of motivation are:

• To stimulate the salesmen to improve their efficiency.
• To establish cordial relationship between the managers and salesmen.
• To maintain high morale among the salesmen.
• To seek cooperation of the salesmen in achieving the sales target.
• To keep the spirits up
• For the growth of the company and to achieve targets
• To retain employees and reduce attrition
• To reach more customers and cover more territory

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

Nature of Motivation:
• The meaning of the word motivation is to move or activate. Motivation is an internal feeling
and an energetic force within salespeople that drives them to behave in a certain way. It
produces goal-directed action harnesses human energy towards the goals of the sales
organization.
• The higher is the level of inducement, the higher is the likelihood of an individual contributing
the organization.
• Motivation is a complex phenomenon that combines the individual needs, motives, drives,
tension, comforts and expectations.
• It has a system of orientation goal of individual is shaped by forces within the individual and
its interaction with surroundings.
• Individuals sets feedback from the environment which either reinforces behavior from
processing certain goals.
Need for Motivation:
Motivation is specially required in sales management as the nature of job is different from the usual
work that the other members of the organisation are engaged in:
1. The job has a lot of obstacles for the salesman, as most of the customers visited don't entertain the
salesmen by giving orders.
2. The salesman has no family life as he is always enveloped in the market and the traders.
3. He has to face acute competition from competitive products. There is no fixed hour of working for
a salesman.
4. The activities of a salesman are repetitive and he gets dissatisfied from repeating his work which
becomes highly monotonous.
5. He is under pressure both from the customer (wholesaler, retailers and consumers) and his
supervisor, as both want to get the best from the deal. The salesman is sandwiched between the two
parties.
6. Too much of travelling and keeping away from home leads to health problems which affects the
salesman in the long run.
7. By working in fields the salesman does not have contacts with his fellowmen or the members of the
organisation and is posted at very distant places most of the year. Thus, he does not have any group
relationship and feels alone most of the time.

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

8. He does not work to full capacity and does an average job to remain in the job. This can be
overcome through proper motivation.
9. Most salesmen have a variety of needs including physiological and social needs and thus feel that
they can't satisfy their needs by remaining in the sales job which gives them lesser opportunities to
socialise with their kith and kin.
10. Motivation helps to build the morale of the salesman; it is a driving force for the salesman.
Motivation can overcome the lethargy and inactiveness of the salesman so that he can perform to the
best of his ability.
Importance of sales motivation:
• Puts human resources into action
• Improves level of efficiency of employees
➢ Increase in productivity,
➢ Reducing cost of operations, and
➢ Improving overall efficiency.
• Leads to achievement of organizational goals
• Builds friendly relationship
• Leads to stability of work force
• Help to achieve his personal goals of sales personnel
• Gives job satisfaction and increase self-development of individual

Explain the Process of Motivation:

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

• Motive(need): Motives are the primary energizer of behavior & explain the reasons of behavior.
• Behavior: The behavior of the salesperson comprises a series of activities that the person does
by being motivated to achieve individual & organizational goals.
• Goal: The goals chosen by an individual salesperson depends on various factors such as the
cultural norms & values, inherited capabilities, learning & experiences.

Factors influencing the Motivation of the Salesperson:

• Changes in marketing environment
• Conflicting company objectives
• Unique nature of the sales job
• Separate motivational package
• Personal characteristics
• Environmental condition
• Organizational polices & procedures

DEFINE COMPENSATION
It refers to monetary benefits offered and provided to employees in return of the services they
provide to the organization. The monetary benefits include basic salary, house rent allowance,
conveyance, leave travel allowance, medical reimbursements, special allowances, bonus, PF/Gratuity,
etc. They are given at a regular interval at a definite time.

WHAT ARE THE FACTORS IN THE WHAT THE OBJECTIVES IN COMPENSATION

MOTIVATION

1. Changes in marketing environment • To recruit & retain qualified

2. the nature of the task, employees.
3. the personality • To increase or maintain morale.
4. the type of compensation plan • To determine basic wage & salary.
5. quality of management • To reward for job performance
6. Conflicting company objectives • Motivating talent for better
7. Unique nature of the sales job performance
PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE
 Sales Management – (18MBAMM401)

8. Separate motivational package

WHAT ARE THE FACTORS IN THE LIST OUT THE METHODS TO MOTIVATE
MOTIVATION SALES PERSON?
1. Changes in marketing environment Common Tips to Motivate a Sales Team:
2. the nature of the task, 1. Create a clear sales plan
3. the personality 2. Implement performance-based incentives.
4. the type of compensation plan 3. Coaching and training
5. quality of management 4. Provide regular and useful sales
6. Conflicting company objectives meetings
7. Unique nature of the sales job 5. Provide ample sales training
8. Separate motivational package 6. Set achievable goals
7. Empower your sales team
8. Establish a solid base salary in addition
EXPLAIN VARIOUS TYPES OF to their commissions and bonuses
COMPENSATION PLANS?
9. Provide positive feedback and
Types of Compensation Plans
recognition
1. Financial compensation
10. Celebrate the successes
2. Non financial compensation
11. Communicate frequently with your team
Financial compensation plan
and have an open door policy
1. Straight Salary
12. Involve your sales team with setting
2. Straight Commission
quotas, sales plans, and sales goals
3. Combination Plan
13. Set challenging goals
Non financial compensation plan
14. Motivate with significant bonuses
1. Promotions
15. Established sales contests or sales games
2. Recognition Programmes
3. Fringe Benefits
4. Expense Accounts
5. Perks
6. Sales Contests

EXPLAIN THE STEPS IN DESIGNING WHAT IS THE NEED OR IMPORTANCE OF

COMPENSATION PLAN EVALUATION & APPRAISAL OF SALES

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

1. Review the sales job description. ... FORCE?

2. Identify the plan objectives. ...  Evaluation is to measure the

3. Identify controllable, measurable job performance of sales persons.

elements. ...  An important process which enhances

4. Establish level of compensation. ... the way organization is managed &

5. Determine method of compensation provides recommendation for further

6. Implement the plan improvements.

 It is a critical function.
WHAT ARE THE OBJECTIVES OF  It constitutes ‘comparing objectives
SALESPERSONS’PERFORMANCE with results.
EVALUATION
 Provide feedback.
1. 1. To ensure that compensation and other
 Take steps to further improvement
reward disbursements are consistent with
 To monitor the performance & ensure
the actual performance of the salesperson.
that it is in alignment with corporate
2. To identify sales people who can be
goals & objectives.
promoted.
 To keep track on progress.
3. To identify sales people whose
 To take decision regarding
employment should be terminated and to
compensation, promotion & transfer.
supply evidence to support the need for
 To determine the specific training &
termination.
counseling needs of individual sales
4. To determine the specific training and
people & the overall sales force.
counseling needs of individual
 To provide information for effective
salespersons and the overall sales force.
human resource plan.
5. To provide information for effective
 To identify criteria that that can be used
human resource planning.
to recruit & select sales people in the
6. To identify criteria that can be used to
future.
recruit and select sales people in the
 To advise sales people of work
future.
expectations.
7. To advise sales people of work
 To motivate sales people.
expectations.
 To help sales people in setting career
8. To motivate salespersons.
goal.
9. To help sales people set career goals.
 To enhance communication between

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

10. To improve salespersons’ performance sales person & sales manager.

 To improve sales person performance.

Define Performance appraisal

It is a process of evaluating an employee’s performance of a job in terms of its requirements.
Performance appraisal is the systematic, periodic and an impartial rating of an employee’s excellence in
the matters pertaining to his present job and his potential for a better job."

WHAT IS THE NEED OF PERFORMANCE APPRAISAL

1. Give feedback on performance to employees.
2. To review the performance of the employees.
3. Provide information to assist in the HR decisions like promotions, transfers etc.
4. Provide clarity of the expectations and responsibilities of the functions to be performed by the
employees.
5. To judge the effectiveness of the other human resource functions.
6. To reduce the grievances of the employees.
7. Helps to strengthen the relationship and communication between superior – subordinates and
management – employees.
8. To judge the gap between the actual and the desired performance.
9. To help the management in exercising organizational control.
10. To diagnose the training and development needs of the future.
11. Identify employee training needs.
12. Document criteria used to allocate organizational rewards.
13. Form a basis for personnel decisions: salary increases, promotions, disciplinary actions, etc.
14. Provide the opportunity for organizational diagnosis and development.
15. Facilitate communication between employee and administration

WHAT ARE THE OBSTACLES TO EFFECTIVE PERFORMANCE APPRAISAL

1. Lack of support from top management.
2. Supervisors lack skills in appraisal techniques.
3. Performance appraisal is not perceived as being productive.
4. Evaluator biases and rating errors.

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

5. Lack of clear, objective standards of performance.

6. Failure to communicate purposes and
7. Lack of suitable appraisal tool.
8. Failure to police the appraisal procedure effectively.

EXPLAIN THE SALES FORCE PERFORMANCE EVALUATION AND CONTROL

PROCEDURE
Step 1• Set policies on performance evaluation and control
Step 2• Decide the bases of salespeople’s performance and evaluation
Step 3• Establish performance standards
Step 4• Compare actual performance with Standards
Step 5• Review performance evaluation with Salespersons
Step 6• Decide sales management actions and control.

EXPLAIN THE METHODS OF PERFORMANCE APPRAISAL:

• Rating scale
• Ranking method
• Paired comparison
• Group appraisal method
• Field review method
• Confidential report
• Essay evaluation
• Critical incident method
• Checklists
• Forced choice method

New methods of performance appraisal

1. 360 DEGREE PERFORMANCE METHOD
2. ASSESSMENT METHOD
3. HR ACCOUNTING METHOD
4. MBO
5. BARS(Behaviorally anchored rating scale)
PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE
 Sales Management – (18MBAMM401)

EXPLAIN SALES FORCE EVALUATION PROCESS

Evaluation of sales force by performance appraisal process:

• Deciding on the criteria for measuring performance; Appraisal criteria, Relative &
absolute judgements, Trait based, outcome based, Behaviour-based, Performance rating, Call
reports, Activity reports.
• Deciding on evaluation of individuals & team; most of the performance appraisals are done
on an individual basis. To evaluate the contribution of each member of the sales force towards
organizational objectives. The selected criteria may be based on volume quota, profit quota,
Activity quota.
• Comparing actual with standard; sales manager is to evaluate the salesperson’s actual
performance either against the industry or standards set by the organization.
• Deciding frequency of a performance appraisal; performance appraisal of salespeople is
undertaken on an annual basis. However more & more organization now measure the
performance of salespeople on a quarterly basis.
• Influence of External Variables; the most common influencing factors are the legal &
ethical issues involved in evaluation. The appraisal system leads to employee reorientation,
training, & in many cases, the termination of employees who are found to be underperforming
for a continuous period.

Stages in the sales force performance appraisal process:

• Establish sales goals and objectives;

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

• Develop the sales plan;

• Set sales force performance standards;
• Allocate resources and sales force efforts;
• Devise a plan for sales force performance improvement;
• Conduct the sales force performance evaluation process;
• Provide feedback on sales force performance appraisals.

Sales Management Job:

• A sales management is responsible for leading and coaching a team of salespeople.
• A sales management tasks often include assigning sales territories, setting quotas, mentoring
the members of its sales team, assigning sales training, building a sales plan, and hiring the
salespeople
• A sales manager must have excellent communication skills to succeed. He must be able to
understand the sales plan and explain it clearly to his sales teams.
• He must also be able to understand his salespeople's needs and communicate those needs to
the executive level.

Sales Manager Job Duties:

• Determines annual unit and gross-profit plans by implementing marketing strategies;
analyzing trends and results.
• Establishes sales objectives by forecasting and developing annual sales quotas for regions and
territories; projecting expected sales volume and profit for existing and new products.
• Implements national sales programs by developing field sales action plans.
• Maintains sales volume, product mix, and selling price by keeping current with supply and
demand, changing trends, economic indicators, and competitors.
• Maintains national sales staff by recruiting, selecting, orienting, and training employees.
• Maintains national sales staff job results by counseling and disciplining employees; planning,
monitoring, and appraising job results.
• Maintains professional and technical knowledge by attending educational workshops;
reviewing professional publications; establishing personal networks; participating in
professional societies.

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

EXPLAIN THE STANDARD SALES MANAGEMENT PROCESS:

A sales process is a set of repeatable steps that a sales person takes to take a prospective buyer from
the early stage of awareness to a closed sale.

Step 1: Prospecting and qualifying

Before planning a sale, do your research to identify the people or companies who might be interested
in your product or service. This step is called prospecting, and it’s the foundational step for the rest
of the sales process. A lead is a potential buyer. A prospect is a lead that is qualified or determined to
be ready, willing and able to buy. The prospecting and qualifying step relates to the needs awareness
step in the buying process.

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

Step 2: Preparation/pre-approach
Before making a sales call, email or visit, it is important to do your homework by researching your
customer and planning what you are going to say. A good salesperson researches a prospect,
familiarizing with the customer’s needs and learning all the relevant background info about the
individual or business.
Step 3: Approach
This is where you make a first impression. You do this by introducing yourself, explaining the
purpose of your call or visit, and establishing a rapport with your prospect. First impressions are
crucial to building the customer’s trust. You work to establish a rapport with the customer first. This
usually involves introductions, making small talk, asking warm-up questions, and generally
explaining who you are and whom you represent.
There are three common approach methods:
o Premium approach: Presenting your potential client with a gift at the beginning of
your interaction
o Question approach: Asking a question to get the prospect interested
o Product approach: Giving the prospect a sample or a free trial to review and evaluate
your service
Step 4: Presentation
Your research and preparation pay off during the presentation, when you propose your sales
solution to your prospect. By the time you are ready to present you will understand your customer’s
needs well enough to be sure you are offering a solution the customer could use. The presentation
should be tailored to the customer, explaining how the product meets that person or company’s needs.
Now is the time to focus on the benefits of your product or service. This might involve a product
demonstration, videos, PowerPoint presentations, or letting the customer look at or interact with the
product.
At this point, the customer is using the information being shared as part of a suite of possible
solutions. They might be researching your offer compared to others. It is during this part of the sale
where you can use upselling and cross selling to engage the customer further. Once you have
identified your customers’ needs you will know if you they would receive additional benefits from an
enhanced product or service offering. This is upselling. Cross selling is pitching additional products
that relate to the product your customer is considering or purchasing (also known as suggestive
selling).
PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE
 Sales Management – (18MBAMM401)

• Step 5: Trial Close

The trial close involves checking the prospect's attitude toward the sales presentation. It may occur
anytime during the selling process. However, it is especially useful
o after making a strong selling point,
o after overcoming an objection, or
o once the presentation is complete
It is used to check the buyer's "pulse" or mood to determine whether he or she is paying attention to
the presentation and whether it is time to ask for a purchase.
Step 6: Handling objections
After you’ve made your sales presentation, it’s natural for your customer to have some hesitations or
concerns, known as objections. Good salespeople look at objections as opportunities to further
understand and respond to customers’ needs.
Be prepared and use some of the following ideas:
o Recognize your customer’s comments by acknowledging their views and then
responding with solutions.
o Ask questions about their views to find ways to address them.
o Restate the customer’s objection. By saying it aloud, you can reduce its impact.
o Ideally you will be prepared for what customers will say and be ready to respond.
Step 7: Closing the sale
The important – and sometimes challenging – part of the sale is closing it! This is where you actually
have to ask if the potential customer is willing to make the purchase. If your customer has been
convinced your product or service will meet their needs, you close the sale by agreeing on the terms
of the sale and finishing up the transaction.
Depending on your business, you might try one of these three closing strategies.
• Alternative choice close: Assume the sale and offer the prospect a choice, where both options
close the sale. For example, ‘Will you be paying the whole fee up front or in installments?’,
‘Will that be cash or card?’ or ‘Would you like me to wrap that for you?’
• Extra inducement close: Offer something extra to get the prospect to close, such as a free
month of service or a discount.
• Standing room only close: Create urgency by expressing time is of the essence. For example,
‘The price will be going up after this month’ or ‘We only have six spots left’.

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

• Step 8: Follow up
While it might seem like you’ve accomplished your goal, the customer journey continues. Follow-
up is an important part of assuring customer satisfaction, retaining customers and prospecting for new
customers. This might mean sending a thank you note, calling the customer to make sure the product
was received in satisfactory condition, or checking in to make sure a service has met the customer’s
expectations.

DEFINE INTERNATIONAL SALES MANAGEMENT:

International marketing is the process of planning and conducting transactions across national
borders to create exchanges that satisfy the objectives of individuals and organizations.
Or
“International marketing focuses its resources on global market opportunities and threats”
“International marketing is the motor of the internationalization process of the firm”.

WHAT ARE PROBLEMS/CHALLENGES IN SELECTION OF INTERNATIONAL MARKET?

• Nature of competition
• Economic environment
• Infrastructural environment
• Marketing research
• Company resources & objectives.
• Market related factors
• Tariff barriers
• Trade practices & customs
• Exchange rate fluctuations
• Restrictions on profit repatriation
• Credit control etc.
• Legal environment
• Intellectual property rights
• Cultural environment

EXPLAIN THE DRIVING FORCES OF INTERNATIONAL MARKETING

• Technology
• Culture
• Market Needs
• Costs
• Free Markets

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

• Economic Integration
• Peace
• Strategic Intent
• Management Vision, Strategy and Action

EXPLAIN THE ROLE OF THE SALES MANAGER IN THE INTERNATIONAL MARKET:

• Basic level functions:
➢ Training
➢ Evaluating
➢ Planning
➢ Compensation
• Advanced level functions:
➢ Strategic account management
➢ Conducting negotiations
➢ Arranging agreements with distributors
➢ Developing relations and network locally

LIST THE CHALLENGES IN INTERNATIONAL SALES MANAGEMENT:

1. Economic environment
➢ Tariff barriers
• Specific
• ad – valorem or stamp duty
• compound
➢ Non-tariff barriers
• Regulatory
• industry
• cultural
2. Other economic factors
➢ Exchange rate fluctuations
➢ Restrictions on profit repatriation
➢ Credit control etc.

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

3. Legal environment
➢ Partnership laws
➢ Anti-Corruption laws
➢ Intellectual property rights
4. Cultural environment
➢ Language
➢ Religion
➢ Education
➢ Social attitudes & behavior
International Market Selection:
Market selection plays a crucial role at the international level. Market selection is based on a thorough
evaluation of the different markets with reference to certain well-defined criteria, given the company
resources and objectives.
International Market Selection Process:
The following are the steps involved in the market selection process:
➢ International Marketing Objectives: The first step in market selection process is to
determine or ascertain the export marketing objectives of the organization. The market
selected to serve a particular international marketing objective need not necessarily be the best
suited to achieve some other international marketing objective.
➢ Parameters for Selection: For proper evaluation and selection of the markets, it is essential to
clearly lay down the parameters and criteria for evaluation. The different parameters for the
selection of a market are firm's resources, international environment, market situation, nature
of competition, government policy, etc.
➢ Preliminary Screening: The objective of the preliminary screening is to eliminate the
markets which are not potential. The parameters used for the preliminary screening may vary
from product to product. However, parameters like the size of population, per capita income,
structure of the economy, infrastructural factors and political conditions are commonly used.
➢ Short Listing of Markets: Preliminary screening enables to eliminate markets which
obviously do not meet consideration at the very outset. There would be a large number of
markets left even after the preliminary screening. They are further screened with the help of
more information than was used at the preliminary screening stage

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

➢ Evaluation and Selection: The short-listed markets are further evaluated with reference to the
cost-benefit analysis and feasibility study. They are then, ranked on the basis of their overall
attractiveness. Of the markets, the best one is chosen for the launching of product considering
the company’s resources and external environment
➢ Test Marketing: Initially, the market is tested on a smaller scale by launching the product in a
part of the markets This provides a feedback to the producer about the market. At the same
time, it helps the producer in assessing overall response of the consumers from a specific
market, after tested success, the production can be undertaken on a mass scale.
➢ Commercial Production: Once the product is tested "in the selected market, the company
goes ahead with mass production. Minor modifications, if any, are introduced in the product
mix during this stage.

Factors considered in International Market Selection

1. Firm related factors
➢ Ethnocentric: everything is centered on the domestic market.
➢ Polycentric: several important foreign markets exist.
➢ Regiocentric: the market is composed of several large economic regions.
➢ Geocentric: the world is one large global market.
2. Market related factors
➢ General factors: Economic factors, Business regulations, Political factors
➢ Specific factors: Trends in domestic market, Trends in export and import, Nature of
competition, Supply conditions of raw materials
➢ Other Factors: Political restrictions, Special requirements, Product specification, Distant
location, Market accessibility, Business community.

Purpose of Market Survey or Strategy:

➢ Gain critical customer feedback: The main purpose of the market survey is to offer
marketing and business managers a platform to obtain critical information about their
consumers so that existing customers can be retained and new ones can be got onboard.
➢ Understand customer inclination towards purchasing products: Details such as whether
the customers will spend a certain amount of money for their products/services, inclination
levels among customers about upcoming features or products, what are their thoughts about
the competitor products etc.
PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE
 Sales Management – (18MBAMM401)

➢ Enhance existing products and services: A market survey can also be implemented with the
purpose of improving existing products, analyze customer satisfaction levels along with
getting data about their perception of the market and build a buyer persona using information
from existing clientele database.
➢ Make well-informed business decisions: Data gathered using market surveys is instrumental
in making major changes in the business which reduces the degree of risks involved in taking
important business decisions.

EXPLAIN THE DRIVING FORCES OF INTERNATIONAL MARKETING

1. Technology
2. Culture
3. Market Needs
4. Costs
5. Free Markets
6. Economic Integration
7. Peace
8. Strategic Intent
9. Management Vision, Strategy and Action

EXPLAIN THE DETERMINANTS OF MARKET SELECTION

1. Firm related factors
2. Market related factors
3. Market selection decision

FIRM RELATED FACTORS

The firms objectives is
a) Market margin surplus
b) Planned business strategy
c) International orientation
d) Expansion of business
e) Skills
f) Resources
g) Competitive advantages

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

Market related factors

a) Marketing strategy
b) Economic factors
c) Business regulations
d) Trends in domestic market
e) Trends in export and import
f) Nature of competition
a) Supply conditions of raw materials
a) Pricing strategy
b) Competitive characteristics
c) Competitive strategies
d) Promotional & distribution strategy

Market selection decision

a) Segment size
b) Marketing objectives
c) Evaluation & short listing of selection market.
d) Determinants of demand
e) Consumption capacity
f) Customer characteristics
g) Growth potential of the segment
h) Competitive characteristics of segment
i) Location of market

EXPLAIN THE INTERNATIONAL SALES TECHNIQUES

Personal selling process
• Preliminary selling
• Identify prospects
• Approach
Advanced selling
• Sales interview
• Flexible presentation
• Product demonstrations
• Handling objections
• Close
Proper routing & scheduling
Routing is a travel plan or pattern used by a sales person for making customers calls
PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE
 Sales Management – (18MBAMM401)

in a territory.
Scheduling refers to establishing a fixed time when the salesperson will be at a
customer’s place of business. It is planning a salesperson’s specific time of visits to
customers. Strict formal route designs enable the salesperson to:
• Improve territorial coverage.
• Minimize wasted time.
• Establish communication between management and the sales force in terms of
the location and activities of individual salespeople.

WHAT ARE THE RESPONSIBILITIES OF SALES MANAGER

The responsibilities of a manager can be grouped under five heads:
1) Responsibility to himself.
2) Responsibility towards organization
3) Responsibility towards customers
4) Responsibility towards his staff and
5) Miscellaneous
Responsibility to himself Responsibility towards Organization
The following are the responsibilities 1.To maintain and also increase the goodwill
towards himself: of the enterprise among his customers
1) To increase managerial abilities 2. To prepare the records and reports etc of
2) To increase and develop selling abilities his department regularly and present the
3) To keep himself in contact with regional same before the top management
changes and developments accordingly.
4) To have knowledge of latest marketing 3. To take steps of reducing sales cost.
techniques 4. To keep a constant watch on the activities
5) To have detailed knowledge of the of the competitors and keep the top
products management aware of them along with his
6) To make continuous and sincere efforts suggestions.
for removing his weaknesses. 5. To make sincere efforts at achieving sales
7) To develop the spirit of cooperation targets.
posses progressive outlook and have good 6. To coordinate and cooperate with the

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

temperament other departments

Miscellaneous 7. To feel proud of the organization
1) Responsibility as to maintenance of public 8. To keep the organization in touch with the
relations changes that are taking place in his region,
2. Responsibility as to office management department etc
3. Responsibility as to sales planning, sales 9. To seek and also provide assistance and
targets sales policies sales forecasting sales cooperation to the enterprise as and when
research etc required. To maintain true and complete
4. Responsibility as to reducing sales costs in accounts of his department.
view of sales volume.
5. Responsibility s to collect and analyze
statistics in connection with marketing
research, product research and consumer
research etc.
Responsibility towards Customers Responsibility Towards Salesmen
1. To remain in constant touch with the 1. To explain the techniques of presenting
customers through sales promotion and the products in such a way before the
advertisement customers which is less time consuming,
2. To explain to the customers the cheaper and more effective.
advantages that they can have by keeping 2. To recruit, select, train, supervise, control,
themselves in touch with the company. remunerate, motivate and promote the sales
3. To provide information to the customers force so that it may perform the duties more
about the miscellaneous uses of the efficiently and effectively.
products. 3. To explain the methods of dealing with the
4. To keep himself in touch particularly with customer’s complaints effectively.
those salesmen who command influence on 4. To provide the detailed knowledge about
customers. the products.
5. To take interest and listen to the 5. To arrange and plan salesmen’s tours,
complaints of the customers and make allocate sales territories, fix sales quotas of
sincere efforts for solving the same each salesman and check the compliance

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

satisfactorily. from time to time.

6. To listen and remove the grievances
complaints and problems of the sales force
and take necessary timely steps for solving
the same. He must see that no clash of
interest takes place
WHAT IS THE ROLE OF SALES PEOPLE
Role of a sales executive:
It is a multi faceted job with a variety of roles to be played. They are
• A Persuader
• A service provider
• An information gatherer and reporter
• An advocate
• A traveler
• A coordinator & scheduler
• A problem definer
• A customer ego builder
• A display arranger for wholesalers and retailers
• A merchandiser who gives customized products to industrial customers

WHAT ARE FUNCTIONS OF A SALES EXECUTIVE/PERSON?

• Identify potential customers from currently available data bases like yellow pages
• Identifying prospective accounts and deciding upon the priority and frequency of making calls
• Deciding upon the selling approach (presentation)
• Administering the sales order (deliver in time)
• Service provider (installation / warranty problems)
• Information gathering and reporting relevant data
• Skill up gradation by attending sales trainings and trade shows
• Administrative responsibilities like attending sales meetings and conferences fill in call and
expense reports etc.
OTHER FUNCTIONS OF SALES PEOPLE
• Listening to customer requirements and presenting appropriately to make a sale;

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

• Maintaining and developing relationships with existing customers in person and via
telephone calls and emails;
• Cold calling to arrange meetings with potential customers to prospect for new business;
• Responding to incoming email and phone enquiries;
• Acting as a contact between a company and its existing and potential markets;
• Negotiating the terms of an agreement and closing sales;
• Gathering market and customer information;
• Representing their company at trade exhibitions, events and demonstrations;
• Negotiating on price, costs, delivery and specifications with buyers and managers;
• Challenging any objections with a view to getting the customer to buy;
• Advising on forthcoming product developments and discussing special promotions;
• Creating detailed proposal documents, often as part of a formal bidding process which is
Largely dictated by the prospective customer;
• Liaising with suppliers to check the progress of existing orders;
• Checking the quantities of goods on display and in stock;
• Recording sales and order information and sending copies to the sales office, or entering
figures into a computer system;
• Reviewing your own sales performance, aiming to meet or exceed targets;
• Gaining a clear understanding of customers' businesses and requirements;
• Making accurate, rapid cost calculations and providing customers with quotations;
• Feeding future buying trends back to employers;
• Attending team meetings and sharing best practice with colleagues.

WHAT IS IMPORTANCE OF SALES MANAGEMENT?

Introduction of new products in the market.
Increasing the production of existing products.
Reducing cost of sales and distribution.
Export market.
Development in the means and communication of transportation within and outside the country.
Rise in per capita income and demand for more goods by the consumers.

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

EXPLAIN THE TYPES OF SALES MANGERS

1. Administrative sales manager:
2. Field sales manager:
3. Administrative-cum-field sales manager:
4. Assistant sales manager:
5. Product-line sales manager:
6. Marketing staff manager:
7. Divisional/regional sales managers:
8. Branch sales mangers:
9. Sales supervisor:

Administrative sales manager:

• Administrative sales managers are found normally in highly integrated sales organisations selling
multiple lines of products in national and international markets.
• He is known by alternative titles such as ‘vice president’, ‘in-charge of sales’, ‘director of marketing’,
‘general sales manager’ and ‘marketing manager’.
• He is primarily concerned with coordination and integration of all the company activities relevant to
marketing. He is not an authority on design, engineering, manufacturing and finance; contrary to
these, he is an authority on sales and profits. It does not mean, however, that he can be aloof from
other departments and their functions.
• In addition to the crucial task of coordinating marketing with other company activities, he is to
coordinate the activities of his own sales organisation within and with outside advertising and sales
counsel.
• He is responsible for sales planning that involves integration of sales personnel, merchandising,
advertising and promotion, financing, distribution network.
• Planning also includes the determination of the functions of sales organisation, delegation of
responsibilities, personnel selection, and performance evaluation. He frames the policies and
strategies on the prices, distribution, relations with dealers, service, advertising and sales-
promotion.

Field sales manager:

• The field sales manager or operating sales manager is a line sales executive reporting directly to the
administrative sales manager. Operative sales manager works under the direction, guidance and
supervision of the general sales manager.

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

• Field sales manager moves with salesmen on visits of importance. He assigns sales territories and
controls activities of salesmen through setting the standards of sales achievements, analyzing the
sales reports, holding the sales meeting, supervising the advertising and sales-promotion
cooperation with dealers, directing sales contests, supervising warehousing inventories, dealer
relations and coordinating territorial and home office activities.
• Thus, a field sales manager provides the administrative sales manager with the latest information
relating to the view points of dealers and consumers on company, company products, policies, and
practices with facts on market trends, competitors, distributors and individual salesman.

Administrative-cum-field sales manager:

• In case of smaller organizations, we come across such sales manager who combines the functions of
administrative and executive sales officer. Generally speaking, administration and field operations
cannot go together. However, size and economy points force many units to combine the distinct
roles of administration and field operation.
• As an administrator, he plans, organizes, directs and coordinates. As a field operator, he guides and
supervises and controls the activities within the sales organization. Thus, thinking and doing are
done by the same person that goes against the very idea of specialization for an administrator is a
‘thinker’ and a line officer as ‘doer’.

Assistant sales manager:

• Generally, the administrative sales manager is assisted by Assistant sales manager in the
administrative functions of planning, analysis, direction and coordination.
• He may also handle sales office personnel, records and routine. He acts as the link between the
head-quarters and the field-sales-manager at distance. It is not a surprise if he discharges the
functions of field sales manager. Thus, he acts as both line and staff officer in the sales
organisation.
• He coordinates the work of sales staff that is specialized in advertising, sales-promotion, research,
merchandising and dealer relations.

Product-line sales manager:

A company that markets variety of products has such product-line sales manager responsible for
one or group of products in the product- line. He is also known as product or brand manager.

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

He is responsible not only for sales but also for production, research, product- development,
planning, advertising and profit for the product or the group of products in question. He is to report
to the Marketing manager who coordinates the work of several product sales managers.

Marketing staff manager:

• As the title suggests, the Marketing staff manager is not a line-officer. He is one of the staff
specialists who are delegated some of the responsibilities of administrative sales manager.
• These are the specialists in the areas of marketing research, sales-promotion, merchandising,
advertising, sales planning, sales personnel, distributor/dealer relations, sales costs, budget sales
finances, traffic, sales office administration and service and the like. These staff managers being non-
line officers have no field tasks.
• These managers are accountable for analyzing the needs of the marketing organization in respect of
their specific areas of specialization, developing plans and recommending solutions to the problems
encountered or thrown open.

Divisional/regional sales managers:

• In all the national organizations, one comes across these Divisional or Regional sales managers.
These are also known as District sales managers who are responsible for the delegated sales
operational duties on a territorial basis.
• They report to Assistant sales managers or the field sales managers who act as the liaison officers
with headquarters. The functions of Divisional or Regional sales manager are similar to those of field
sales manager who is in charge of several divisions or regions and hence divisional or regional
managers.
• They are mainly responsible for maintaining the man-power in the concerned areas by recruiting,
selecting, and training, supervising, motivating and controlling the sales-force.
• They are also responsible for directing branch or local office sales managers. The divisional sales
managers assist branch managers in solving their sales personnel problems, dealer relations,
warehousing and inventory, advertising and sales promotion, sales campaigns and sales meetings.

Branch sales mangers:

• In case of sales organizations that operate branches or local sales offices in major cities of the
country, one is to come across such Branch sales managers. Branch sales manager is a line executive

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)
responsible for the direction of a small group of salesmen calling on consumers or dealers in the
branch area.
• He recruits, selects and trains, sales people with the guidance of Divisional or Regional sales manager
to whom he reports. He works along with salesmen in the field, supervises their sales activities, holds
periodic sales meetings, evaluates sales performance and helps in key accounts. If warehouse is
attached to branch, he supervises warehousing activities too.

Sales supervisor:
• A sales supervisor is a line sales manager who supervises normally eight to fourteen salesmen. He is
seen in branch sales office of a national sales organisation having branches all over the nation.
• He is responsible to the local branch sales manager. In case there is no branch sales manager, then he
is responsible to the sales manager of the company directly. His work is to train and motivate the
salesmen under his charge.
• His supervision, guidance and coaching helps in building up more confident sales personnel. He is the
key communicator in the transmission of information on sales policies of new products, promotions
and marketing programmes between the higher-ups and individual salesmen.

EXPLAIN THE TYPES OF SALESPEOPLE OR SALESFORCE.

1. Transactional
2. Relational
3. Closers
4. Consultants
5. Pioneer salespersons
6. Merchandising salespersons
7. Wholesaler salesperson
8. Retailer salesperson.

Pioneer salespersons: IT give information to consumers about new goods or services of

manufacturers. They present themselves active, influential and decisive to introduce new
products in markets. Their role becomes important to introduce new product in markets. Their
role becomes important to create demand for new products.
Merchandising salespersons: The sellers who are skilled in selling special types of goods like
medicines, scientific materials and equipment, electronics goods etc. are called merchandising
PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE
 Sales Management – (18MBAMM401)

salespersons. Appointed by manufacturers can have good knowledge about the products.

Wholesalers' salespersons: The sellers appointed by wholesalers are called wholesalers'

salespersons. Their main function is to help wholesalers to supply needs of retailers by keeping
regular contact with them. Such salespersons go to retailers'shop,check the stock of goods, collect
purchase orders, make arrangement of delivery etc. They give advice and suggestions to retailers
about, decoration, display of goods, promotion etc. They also give wholesalers about market
situation, retailers' problems, competition etc. and help them.\

Retailers' salesperson: The sellers appointed by retailers for the purpose of taking help in
distribution and sales of goods or services are called retailers salespersons. They find prospective
customers, contact them, help them in selection of goods and deliver goods to them.

Transactional: Transactional salespeople are those that simply wait for the transaction to make their
sale. These are the salespeople that you might refer to as the order-takers because they passively sit
by waiting for the sale to come to them.
They may still be quite successful in what they do, despite their passive attitude, because they may
become adept at positioning themselves in the right place at the right time to get the sale.
However, most of these salespeople are better off working in a retail environment where the
primary job of the salesperson is to help the buyer find the product she is already looking for and
then ring it up.

Relational: The relational salesperson thrives off of the customer-salesperson relationship. This type
of salesperson is good at quickly building rapport with the customer and often gets sales because
the buyer likes her enough that she becomes the deciding factor in the sales process. These
salespeople also establish the long-term relationship with a customer that brings the customer back
around for repeat business. These types of salespeople tend to excel in industries like advertising or
any type of sales where established accounts selling are important.

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

Closers: A large portion of the sales force in many different industries is made up of closers or those
who are always trying to close the deal on a sale. These are what many people think of when they
think of the used car salesman. This type of salesperson is constantly inching the customer toward
the goal of closing the deal. While relationships with customers may still be important for future
sales with this type of salesperson, they are usually secondary to the immediate goal of going for
the close.

Consultants
Consultants are probably the best-rounded of the different types of salespeople. These are people
persons who know how to close a deal and build relationships at the same time. Consultants
genuinely thrive off of the problem-solving aspect of their job, listening to customer needs and
helping them find a solution to their problem. Consultants have superior listening skills and tend to
be patient with customers when necessary, but aggressive when necessary also.

WHAT ARE THE CHARACTERSTICS OF SALES MANAGER

• Passion
• Integrity
• Positive attitude
• Loyalty
• Leadership skills
• Motivation
• Continuous learning
• Listening and communication

1.Communication
Whether you communicate with your team verbally or in writing, you need to be clear, effective and
efficient. Without this skill you’ll never be able to give instructions that can be followed by your
team.
2. Teamwork
A sense of team can make a significant difference in whether you meet or fail your objectives.
Making sure you hold team meetings to share information, tips and successes is essential. Just as
PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE
 Sales Management – (18MBAMM401)

important is creating and maintaining the bond across the team. Typically, more fun, out of work
activities encourage this.
3. Performance management
As the manager, you are expected to get the most out of each team member. This means that if any
member is not performing effectively, you need to address this. If your company doesn’t already
have a formal process in place, develop your own simple and fair method for setting objectives and
tracking each person’s achievement against them.
4. Personal development: Similarly, you’re responsible for making sure that every member has the
necessary skills to do the job well. Creating a personal development plan to identify what training is
needed is a simple way to achieve this. Quarterly reviews ensure that you’re always on top of this
responsibility.
5. Leadership: Your team will be looking to you for leadership. They will want you to set clear
direction and targets. In times of stress and turbulence, they will look to you to take control and
steady things. When things go wrong, they will look to you to shoulder the strain and find solutions.
6. Fairness
Unless you are scrupulously fair at all times, you may find yourself undermined in your efforts to
achieve your objectives. When people sense unfairness, they lose all respect for their manager.
Performing well under these conditions is impossible.
7. Resilience(flexibility)
Some things will be difficult, and at times, things may go wrong. You must be able to shake off each
problem, re-focus and carry on driving through your objectives. Your team will often be
unreasonable, and you will face countless disappointments. You can’t afford to let these bring you
down or slow you up, though.
8. Delegation
As a salesperson, if you succeeded or failed it was down to your efforts and ability. As a sales
manager, you simply can’t (and shouldn’t) do everything yourself. Learn how to delegate effectively
if you want to get anything done.

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

9. Motivation and inspiration

This is the one that’s arguably most difficult to learn. Some people think that they need to give great
speeches to inspire their people. Happily, if you manage to do most of the above, most of the time,
with grace, humour and generosity, you will inspire your team to follow you into your ‘battles.’
Becoming a sales manager may be your next step, but it’s still no easy task. In fact, it’s full of
obstacles. Michael Jordan had something to say about those, though: “Obstacles don’t have to stop
you. If you run into a wall, don’t turn around and give up. Figure out how to climb it, go through it,
or work around it.” And by learning what the key attributes of a sales manager are, you’ll soon be
working around any of the obstacles you face!
confident.
"If you don't believe in your product, you aren't going to make a customer believe in your product. If
you can confidently explain how your product or service is going to solve a problem for the
customer, then you've got the customer in the palm of your hand."

WHAT ARE THE CHARACTERISITCS OF SALES PEOPLE

There are five key qualities that are essential for success:
1. Empathy
2. Focus
3. Responsibility
4. Optimism
5. Ego-drive

Empathy
Empathy is the ability to identify with customers, to feel what they are feeling and make customers
feel respected. Empathy is NOT sympathy, which involves a feeling of loyalty with another
individual. It is more than understanding their concerns from an objective standpoint. A
salesperson showing empathy can gain trust and establish rapport with customers by being on their
side and not appearing judgmental. Empathy allows the salesperson to read the customers, show
concern, and clearly demonstrate his or her interest in providing a proper solution.

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

Focus
A person with focus is internally driven to accomplish goals and can stay attentive to one topic.
Focused individuals are more demanding of themselves than other people and they are self-
motivated. They are able to organize themselves and recognize what needs to be done in order to
achieve their goals.

Responsibility: A person with a strong sense of responsibility does not place blame on other people
when placed in a difficult situation. This type of person, referred to as an “agent”, gets things done
and when obstacles arise, accepts any errors or omissions that have occurred. He or she does not
get defensive nor do they try to blame the situation on circumstances or on other people by making
statements such as, “It’s not my fault boss that consumer confidence has declined due to terrorism
and the war in Afganistan.” Sales managers should strive to hire agent-type representatives.

Optimism (confidence or hopefulness):A salesperson with a healthy amount of optimism can be

described as someone who is slow to learn helplessness. This person has persistence—a trait that is
critical in the sales world because of the frequency of rejections salespeople experience. In the face
of failure, some people throw their hands up in the air and resign themselves to the disappointment
because they feel helpless to change the situation.
Others, however, see themselves as being more flexible and that a customer’s refusal is NOT a
rejection of themselves personally, but of the opportunity being offered. Salespeople who possess a
large amount of optimism like themselves and when they encounter failure, although disappointed,
it does not destroy their positive view of themselves. They consider themselves still in the running
and able to turn the situation around. They believe that they can make things better by using a
different approach, or by trying again.

Ego-drive: Ego-drive is similar to optimism in that both traits require determination. But ego-drive is
determination for the purpose of succeeding and above all winning. It’s all about competitiveness.
When a person hangs in there with fists clenched and a teeth gritting appetite to succeed at his or
her goal, you see a powerful ego-drive. This person is self-motivated and a self-starter with clear
ideas of what he or she wants to achieve.

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

EXPLAIN THE CONCEPT OF TIME MANAGEMENT FOR SALES MANAGER AND SALES PERSON.
Time Management is the process of deciding what to do and When. For Managers and Supervisors it
usually consists of the following 3 phases:
Phase 1: - Identifying what you want/need to accomplish based on the roles and expectations
of your position, and your own personal goals.
- Identifying and prioritizing the major tasks and needed time commitments to accomplish these
goals.
Phase 2: - Analyzing how you’re currently spending your time versus the needs you identified
above.
Phase 3: - Developing a schedule that better allows you to focus your daily efforts on accomplishing
your goals.

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

Chapter-6
Define E-payment or Electronic payment
E-payment or Electronic payment is any digital financial payment transaction involving currency transfer
between two or more parties

EXPLAIN THE PAYMENT SYSTEM IN INTERNET TRADING

1. Debit card
2. Credit card
3. E-cash:
4. Smart card
5. E-cash

E-cash: A system that allows a person to pay for goods or services by transmitting a number from one
computer to another. Like the serial numbers on real currency notes, the E-cash numbers are unique. This
is issued by a bank and represents a specified sum of real money.

Debit card
A payment card that deducts money directly from a consumer’s checking account to pay for a purchase.
Debit cards eliminate the need to carry cash or physical checks to make purchases.
In addition, debit cards, also called check cards, offer the convenience of credit cards and many of the
same consumer protections when issued by major payment processors like Visa or MasterCard. Unlike
credit cards, they do not allow the user to go into debt, except perhaps for small negative balances that
might be incurred if the account holder has signed up for overdraft coverage. However, debit cards
usually have daily purchase limits, meaning it may not be possible to make an especially large purchase
with a debit card.
Debit card, like credit card is a small plastic card with a unique number mapped with the bank account
number. It is required to have a bank account before getting a debit card from the bank. The major
difference between debit card and credit card is that in case of payment through debit card, amount gets
deducted from card's bank account immediately and there should be sufficient balance in bank account
for the transaction to get completed. Whereas in case of credit card there is no such compulsion.

Credit card
Credit card provides a card holder credit to make purchase up to amount fixed bya card issuer.Pre-
approved credit which can be used for the purchase of items now and payment of them later. When a
customer purchases a product via credit card, credit card issuer bank pays on behalf of the customer and
customer has a certain time period after which he/she can pay the credit card bill. It is usually credit card
monthly payment cycle.
Standard-size plastic token, with a magnetic stripe that holds a machine readable code. Credit cards are a
convenient substitute for cash or check, and an essential component of electronic commerce and internet
commerce.

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

Credit card holders (who may pay annual service charges) draw on a credit limit approved by the card-
issuer such as a bank, store, or service provider (an airline, for example). Cardholders normally must pay
for credit card purchases within 30 days of purchase to avoid interest and/or penalties.

Electronic Fund Transfer

It is a very popular electronic payment method to transfer money from one bank account to another bank
account. Accounts can be in same bank or different bank. Fund transfer can be done using ATM
(Automated Teller Machine) or using computer.
Now a day, internet based EFT is getting popularity. In this case, customer uses website provided by the
bank. Customer logins to the bank's website and registers another bank account. He/she then places a
request to transfer certain amount to that account. Customer's bank transfers amount to other account if it
is in same bank otherwise transfer request is forwarded to ACH (Automated Clearing House) to transfer
amount to other account and amount is deducted from customer's account. Once amount is transferred to
other account, customer is notified of the fund transfer by the bank.

E-cash:
A system that allows a person to pay for goods or services by transmitting a number from one computer
to another. Like the serial numbers on real currency notes, the E-cash numbers are unique. This is issued
by a bank and represents a specified sum of real money.

Check Free
Check Free provides online payment processing services to both large corporations and individual
Internet users.CheckFree permits users to pay all their bills with online electronic checks.
Check Free provides part of the technology that the Web portal Yahoo! uses to provide its Yahoo! Bill
Pay service.

Smart card
The smart card looks exactly like any other plastic card or an ATM card with an integrated circuit (IC
Chip) installed. The IC chip contains memory, may contain a processor, and communicates with the
external world through contacts on the surface of the card.
A smart card, chip card, or integrated circuit card (ICC), is any pocket-sized card with embedded
integrated circuits which can process data. This implies that it can receive input which is processed — by
way of the ICC applications — and delivered as an output .The size, position and utility of the contacts
are specified by an international standard, so that cards can interact with a variety of equipment.

WHAT ARE THE ADVANTAGES AND DISADVANTAGES OF DEBIT CARD

ADVANTAGES OF A DEBIT CARD
✓ Easy to obtain. Once you open an account most institutions will issue you a debit card upon
request.
✓ Convenience. Purchases can be made using a chip-enabled terminal or by swiping +the card
rather than filling out a paper check.
✓ Your Pin Protects You
PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE
 Sales Management – (18MBAMM401)

✓ Anyone Can Have One

✓ Safety. You don't have to carry cash or a checkbook.
✓ Readily accepted. When out of town (or out of the country), debit cards are usually widely
accepted (make sure to tell your financial institution you’re leaving your city; to not have an
interruption in service).
✓ Applicability: acceptance of the user where he/she can use the method to buy goods or services.
✓ Traceability: traceability of the money in the system who and when it occurs with anonymity
cause to built trust
You can use your debit card almost anywhere
No monthly interest charges on your spending

DISADVANTAGES OF A DEBIT CARD

✓ No grace period. Unlike a credit card, a debit card uses funds directly from your checking
account. A credit card allows you to borrow funds on credit, leaving disposable cash in your
account.
✓ Check book balancing. Balancing your account may be difficult unless you record every debit
card transaction.
✓ Less protection. Most financial institutions will try and protect their customer from debit card
fraud. However, a customer could potentially be liable for up to $500 on fraudulent debit card
transactions compared with only $0 on credit cards. Be sure to check with your financial
institution to learn the details.
✓ Fees. Using your debit card for ATM transactions may be costly if the ATM is not affiliated with
your institution.
✓ Fees Galore

WHAT ARE THE ADVANTAGES & DISADVANTAGES OF CREDIT CARD

ADVANTAGES DISADVANTAGES
Convenience Overuse
Keep records Paying high rates of interest.
Instant cash Credit card fraud
widely accepted online, in most stores Annual fees
perks & rewards High cost fees
emergency line of credit Unexpected fees
Deepening your debt
Credit score

WHAT ARE THE PROBLEMS IN EPAYMENT

There are also many problems with the traditional payment systems that are leading to its fade out. Some
of them are enumerated below:
1. Lack of Convenience

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

2. Lack of Security
3. Lack of Coverage
4. Lack of Eligibility
5. Lack of support for micro-transactions
•Lack of Convenience:
Traditional payment systems require the consumer to either send paper cheques by snail-mail or require
him/her to physically come over and sign papers before performing a transaction. This may lead to
annoying circumstances sometimes.
•Lack of Security:
This is because the consumer has to send all confidential data on a paper, which is not encrypted, that too
by post where it may be read by anyone.
•Lack of Coverage: When we talk in terms of current businesses, they span many countries or states.
These business houses need faster transactions everywhere. This is not possible without the bank having
branch near all of the company’s offices. This statement is self-explanatory.
•Lack of Eligibility: Not all potential buyers may have a bank account.
•Lack of support for micro-transactions:

HOW TO MAKE INTERNET SELLING SAFE

• Stick to the facts of the item being sold.
• Do not put any information that identifies you personally if it’s not strictly necessary. Keep in
mind that every piece of information you post may be used for other purposes than you intended.
• Limit your information to limit your risk.
• If you receive any email from the other party, do not delete it.
• Look hard at any photo you post, you don’t want it to include house numbers in the background, or
license plate numbers, include family members, etc. Show just the item being sold.
• If you want the convenience of allowing people to call you (as opposed to emailing you), use a free
disposable phone number. You can get one easily by searching on ‘disposable phone number’ and
selecting from one of several companies that provide this service.
• Don’t put your personal phone number in the ad – you don’t want people to be able to harass
you later, and there are several reverse look-up directories may provide a wealth of information
about you that can be used in ways you would not appreciate.
• If the service does not have their own email service, create a disposable email account that does not
show any personal information – like your name, location, or age. Again, you do not want people to
have your primary account information to harass you through.
• Make it clear that you will only accept cash for the item. Any other form of payment is highly
likely to be fraudulent.
• Agree to meet during daylight hours in a public place and bring a friend to accompany you.
Turn down any request to meet at your house, in an unfamiliar place, or by yourself no matter how
big and tough you are.

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

• Do not hand over the item until you have cash in hand. Don’t accept partial payment or
anything other than cash for the transaction. If the method of payment changes from your previous
agreement, walk away from the deal.
• Make your meeting a two-step process. Arrange to meet during daylight hours and have a friend
be there with you.
• Don’t accept partial payment, or anything other than cash for the transaction.
• If more than one person arrives, keep them together. A common ploy is for one person to
engage you with questions while another asks to use the restroom. Decline.
• Don't reveal personal information: Remember this is a business transaction, so never reveal
Social Security numbers, home or business addresses or banking information.
• Don't use your personal email: Use an anonymous email address to communicate with the buyer
or seller.
• If it's a high-priced transaction, do it at a bank: The higher the price of the item involved, the
higher the risk of the transaction. Conduct these transactions at a banking facility so a banking
professional can confirm the funds have been delivered successfully.
• Never meet at home: Find a neutral site to meet -- never at your or someone else's home.
• Tell someone: Tell a trusted friend or family member what you're doing and have another trusted
friends or family member accompany you to the transaction.
• Always meet in a public place: Most police departments will be happy to accommodate you, and
they are open 24/7.

EXPLAIN DIGITAL SIGNATURE

• Digital signature: a digital code (generated and authenticated by public key encryption) which is
attached to an electronically transmitted document to verify its contents and the sender's identity.
• The digital equivalent of a handwritten signature or stamped seal, but offering far more inherent
security, a digital signature is intended to solve the problem of tampering and impersonation in
digital communications.
• Digital signatures can provide the added assurances of evidence to origin, identity and status of an
electronic document, transaction or message, as well as acknowledging informed consent by the
signer.

EXPLAIN BIOMETRIC METHOD

• Biometric technologies appear to be useful tools for identification and verification in security
initiatives. Trust in these electronic transactions is essential to the healthy growth of the global
economy.
• Biometrics is the automated method of recognizing a person based on a physiological or behavioral
characteristic. Biometric technologies are becoming the foundation of an extensive array of highly
secure identification and personal verification solutions.
• Before implementing these technologies, one must consider whether biometric systems really work,
whether they are sufficiently advanced to provide their touted capabilities, and their effectiveness.
Accuracy, the possibility for deception, and user acceptance issues are also important considerations.
PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE
 Sales Management – (18MBAMM401)

• Biometric identification consists of determining the identity of a person. The aim is to capture an
item of biometric data from this person, for example by taking a photo of their face, by recording
their voice, or by capturing an image of their fingerprint. This data is then compared to the
biometric data of several other persons kept in a database.
• Moreover, today's fast-paced electronic world means people are asked to remember a multitude of
passwords and personal identification numbers (PINs) for computer accounts, bank ATMs, e-mail
accounts, wireless phones, web sites and so forth. Biometrics hold the promise of fast, easy-to-use,
accurate, reliable, and less expensive authentication for a variety of applications.
• During Enrollment a sample of the biometric trait is captured, processed by a computer, and stored
for later comparison. Biometric recognition can be used in Identification mode, where the biometric
system identifies a person from the entire enrolled population by searching a database for a match
based solely on the biometric. For example, an entire database can be searched to verify a person has
not applied for entitlement benefits under two different names.
• Utilizing biometrics for personal authentication is becoming convenient and considerably more
accurate than current methods (such as the utilization of passwords or PINs). This is because
biometrics links the event to a particular individual (a password or token may be used by someone
other than the authorized user), is convenient (nothing to carry or remember), accurate (it provides
for positive authentication), can provide an audit trail and is becoming socially acceptable and
inexpensive
• Biometric techniques are mainly used in the sectors of forensic identification, identity management,
as well as access control and administration, both in private and public institutions. The effectiveness
of this technology is closely linked to the use of data processing. Data is stored in files to enable
rapid and reliable identification, which in turn guarantees both comfort and security. The most well-
known techniques include fingerprints, face recognition, iris, palm and DNA-based recognition.
Research is currently opening the way for new types of biometrics, such as ear shape or facial
thermography.
• Utilized alone or integrated with other technologies such as smart cards, encryption keys and digital
signatures, biometrics are set to pervade nearly all aspects of the economy and our daily lives.
• The promises of e-commerce and e-government can be achieved through the utilization of strong
personal authentication procedures. Secure electronic banking, investing and other financial
transactions, retail sales, law enforcement, and health and social services are already benefiting from
these technologies.
• There are many needs for biometrics beyond Homeland Security. Enterprise-wide network security
infrastructures, secure electronic banking, investing and other financial transactions, retail sales, law
enforcement, and health and social services are already benefiting from these technologies.
• A range of new applications can been found in such diverse environments as amusement parks,
banks, credit unions, and other financial organizations, Enterprise and Government networks,
passport programs and driver licenses, colleges, physical access to multiple facilities (e.g.,
nightclubs) and school lunch programs.

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

• Biometric-based authentication applications include workstation, network, and domain access, single
sign-on, application logon, data protection, remote access to resources, transaction security and Web
security.

It should be considered and evaluated giving full consideration to the following characteristics
1. Universality: Every person should have the characteristic. People who are mute or without a
fingerprint will need to be accommodated in some way.
2. Uniqueness: Generally, no two people have identical characteristics. However, identical twins are
hard to distinguish.
3. Permanence: The characteristics should not vary with time. A person's face, for example, may
change with age.
4. Collectability: The characteristics must be easily collectible and measurable.
5. Performance: The method must deliver accurate results under varied environmental circumstances.
6. Acceptability: The general public must accept the sample collection routines. Non intrusive methods
are more acceptable.
7. Circumvention: The technology should be difficult to deceive

THE RISKS OF ERROR ARE

• Other difficulties arise in particular with facial recognition, when the person dyes or cuts their
hair, changes the line of their eyebrows or grows a beard. We can imagine cases of "false
acceptance" when the photo taken modifies distinctive character traits in such a way that they
match another item of biometric data stored in the database.
• Other errors are also possible depending on the technologies used during the biometric enrollment
phase. A verification photo taken with a low-quality model of camera can noticeably increase the
risk of error. The accuracy of the identification relies entirely on the reliability of the equipment
used to capture data.
• In addition to being dependent on the technique used, the risk of error also varies depending on
the environment and the conditions of application. The light may differ from one place to another,
and the same goes for the intensity or nature of background noise. The person's position may
have changed
• We have noted that particular biometric techniques were more or less well suited to certain
categories of persons. The difficulties are related to ergonomic factors of which we do not yet
have a firm grasp or understanding. A certain system may work for women, but less well for men,
or for young people but not for older people, for people with lighter skin, but less well for those
with darker skin.

EXPLAIN THE GROWTH OF INTERNET TRADING IN INDIA

✓ Provides Control to Investors Money When an investor wants to buy or sell stock he no longer
need to call his broker on the phone thus helping in the execution of the order instantly on the
internet.
✓ Provides access to the market

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

✓ Through the sophisticated information streams, dedicated trading platforms and sophisticated
tools the investor can access the markets which provides more agility in buying and selling
stocks.
✓ Ensures the best price for investors
✓ Some companies like Invest smart (IL&FS) specialize in the techniques which offers the best
price deals for the buy and sell orders of the investors and traders providing the high level of
transparency by displaying of information relating to the specific stocks and company profiles
which helps in getting the best quote for the orders
✓ Online trading offers greater transparency
✓ Online trading offers the investors with greater transparency by providing with an audit trail. The
process involves a complete integrated electronic chain starting from order placement, to clearing
and settlement and finally ending with a credit into the depository account of the investor. All
these stages are inspected which brings the transparency into the system.
✓ Provides hassle free trading
✓ Online trading provides an integration of the bank account, trading account and demat accounts,
which leads to easy and paperless trading for the client.
✓ Online trading allows instant trade execution
✓ Online transactions helps in the quick execution of the entire trading transaction right from
logging to the traders site and to the settlement of the bank account in a very short period of time.
✓ It provides a level playing field
✓ Trading online gives even the smallest retail investor access to information which was earlier
available only to the big traders. It has provided with a level playing field for all investors in the
securities market.
✓ Online trading reduces the settlement risk
✓ This method of trading reduces the settlement risk for the investor as when a short sell order is
played the orders are squared off at the specified cut-off time and are not allowed to be carried
forward.
✓ Provides live financial news & analysis
✓ The online sites also provide live terminals which provide streaming news to give investor the
latest financial information as it occurs.
✓ Online help desk
✓ Some companies provide online help desk an investor cancan contact the Tele Trading
Executives from the Tele Trading team during and after market hours and can clarify questions.
✓ Instant order trade confirmations: Through online trading every trade is confirmed
immediately and investor receives an on-screen confirmation following every trade with full
details for the investors records which avoids costly errors that would have been discovered when
it is too late.
✓ Keeps Information Secure :As per the guideline provided by SEBI every effort has to be made
to keep the investors account and personal information secure by use of encryption technology
and updated security technology to advanced fraud prevention measures.

DISADVANTAGES OF ONLINE TRADING

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE
 Sales Management – (18MBAMM401)

• In online terminal, investor can’t get customized expert advice, whereas in offline the broker
gives suggestions according to investors strategy (i.e. short term or long-term)
• Brokerage is high compared to offline.
• Privacy is less due to hacking scandals
• Transactional errors due to technical problems

Online selling is a form of electronic commerce which allows sellers to directly sell goods or services
to a buyer over the Internet using a web browser. Online selling is a form of electronic commerce
which allows sellers to directly sell goods or services to a buyer over the Internet using
a web browser.
Online trading is basically the act of buying and selling financial products through an online trading
platform. These platforms are normally provided by internet-based brokers and are available to every
single person who wishes to try to make money from the market.
Advantages of Internet Trading:
• Low Price
• Convenience
• Variety of products
• Discreet shopping
• Reviews from the customers
• Absence of Salesperson interruption
• Cash on Delivery
Disadvantages of Internet Trading:
• Trying or Inspecting the Product Before Buying
• Security and Privacy
• Absence of the Pleasure of Shopping
• Shipping Adds to the Cost
• Returns Can Be Costly
• Dealing with an Unknown Vendor

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

Challenges of Internet Trading:

• High competition
• Poor logistic and supply chains
• Payments issues
• Internet Infrastructure
• Tax and Regulatory Environment
• Global issues like language, culture, time and distance.

Growth of Internet Trading in India:

Introduction:
Over the last decade, internet has changed the way people buy and sell goods and services. Online
retail or e-commerce is transforming the shopping experience of customers. The sector has seen
unprecedented growth especially in the last five years in India. The adoption of technology is enabling
the e-commerce sector to be more reachable and efficient. Devices like smart phones, tablets and
technologies like 3G, 4G, Wi-Fi and high-speed broadband is helping to increase the number of
online customers. Banks and other players in e-commerce ecosystem are providing a secured online
platform to pay effortlessly via payment gateways. The home-grown players have shown tremendous
growth and attracted some big investors. The entry of global companies like Amazon and Alibaba has
taken the competition to a new level. E-tailers are differentiating themselves by providing innovative
service offerings like one-day delivery, 30-day replacement warranty, cash on delivery, cash back
offers, mobile wallets, etc. The supply chain has improved significantly and e-tailers are even
leveraging on the services of Indian Post for greater reach across the country.

Key Factors Influencing the Growth of Internet Trading in India:

• Internet Boom: After 2005, a rapid growth has been seen in the number of people using the
internet. This is due to enhanced broadband internet services and penetration of 3G services
that has given faster internet access.
• Standard of living: The living standard of the people has made them inclined towards e-retail
sites for shopping. The increased per capita income has also played its part in this inclination.
• Availability of wider range: Online market offers a much wider range of products than any
retail shop. People have wider options for the products online and even can buy those products
that are not available at the retail shops.
PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE
 Sales Management – (18MBAMM401)

• Lifestyle: In today’s busy lifestyle, lack of time for offline shopping and urban congestion of
traffic has also led to the boom of the online shopping market.
• Free classified sites: These sites have been launched where more consumers can buy and sell
used goods as well.
• Competition in online market: Competition among the online shopping websites has
attracted more customers to go for online shopping.
• Discounts and cheap rates: Through numerous offers, these sites sell the products to the
customers. Hence, products can be purchased at a lesser price than the offline markets and that
too without sacrificing the quality.
• Improved online banking services: With improved and safer online banking services
customers are now less hesitant to make payments online which in turn increase their
confidence to shop more online.
• Cash on delivery and home delivery: Cash on delivery along with home delivery has played
a great role in the inclination of people toward e-retail sites. E-tailers in India are also
providing various value-added services such as free shipping, product returns, product and
price comparison, user reviews and demonstration videos. All these factors have driven the
change in preference from offline to online shopping.

Advantages of Online Advertising:

➢ You can easily test the market.
➢ The ad campaign is less expensive.
➢ The ad works 24 hours a day, 7 days a week, 365 days a year.
➢ You can change your online ad much more easily than you can

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

➢ Change ads in other media.

➢ Your customers can see your ad, shop, and buy, (if you sell your
➢ Goods online) all without leaving home.
➢ You can target your audience effectively.
➢ The ability to set daily spend limits
➢ The ability to track, test and evaluate the effectiveness of Campaigns compared to other
medium
➢ The ability to run multiple campaigns
➢ Easy to implement and easy to withdraw.
Disadvantages of Online Advertising:
➢ Don’t know if they actually get what they pay for.
➢ Don’t know if they can trust the visitor and/or traffic profile online media owners and
publishers claim their sites have.
➢ Have the feeling there is a lot of click fraud.
➢ Don’t know if their ads appear in the sites and/or sites’ sections where they should appear.
➢ Surfers who are on the net for a specific purpose may ignore your ads.
➢ Surfers may notice your ads but choose not to click.
➢ Low-net penetration of your target markets. This will push up cost per contact.
➢ There is a limited media choice as not all Indian sites maintain user data- bases.
➢ There is an absence of sufficient research on the effectiveness of web ads.
➢ The web is a highly competitive environment and it’s easy to get lost.
➢ Poorly managed campaigns can be expensive and ineffective.
➢ By not evaluating what you’re doing you’re likely to waste money.

Explain different Methods of Electronic Payment:

The different methods of electronic payments in use today are:
1. Smart Card:
It is a plastic card embedded with a microprocessor that has the customer’s personal information
stored in it and can be loaded with funds to make online transactions and instant payment of bills. The
money that is loaded in the smart card reduces as per the usage by the customer and has to be reloaded
from his/her bank account.

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

Advantages of Smart Cards

➢ More Secure: This simple technology has revolutionized the payment card industry and
increased the level of card security. These cards use encryption and authentication technology
which is more secure than previous methods associated with payment cards.
➢ Safe to Transport: Another advantage to having a smart card is their use in the banking
industry (and many other sectors). These cards give the holder freedom to carry large sums of
money around without feeling anxious about having the money stolen.
➢ Double as an ID Card: A third advantage of using a smart card is that they can provide
complete identification in certain industries. There are numerous benefits of using smart cards
for identification.
➢ Prevents Fraud: Other benefits of using smart cards for identification can be used by
governments to prevent benefits and social welfare fraud to ensure the right person is
receiving the welfare benefit.
Disadvantages of Smart Cards
➢ Easily Loss: smart cards are small, lightweight and can be easily lost if the person is
irresponsible.
➢ Security: A second disadvantage of the using smart cards is their level of security. They are
more secure than swipe cards. However, they are not as secure as some in the general public
would believe.
➢ Slow Adoption: If used as a payment card, not every store or restaurant will have the hardware
necessary to use these cards.
➢ Possible Risk of Identify Theft: When used correctly for identification purposes, they make
the jobs of law enforcement and healthcare professionals easier.

2. Credit Card:
The most popular form of payment for e-commerce transactions is through credit cards. It is simple to
use; the customer has to just enter their credit card number and date of expiry in the appropriate area
on the seller’s web page. To improve the security system, increased security measures, such as the use
of a card verification number (CVN), have been introduced to on-line credit card payments. The CVN
system helps detect fraud by comparing the CVN number with the cardholder's information.

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

Advantages of Credit Card

➢ Building credit history.
➢ A quick source of funds in an “absolute” emergency
➢ No accrued interest if bill is paid on time and in full each month
➢ Zero liability as consumers is not responsible for fraudulent charges when reported promptly.
➢ Consumer protection, if fraudulent charges are reported promptly in case the card is stolen or
lost.
Disadvantages of Credit Card
➢ Established credit-worthiness needed before getting a credit card
➢ Encouraging impulsive and unnecessary “wanted” purchases
➢ High-interest rates if not paid in full by the due date
➢ Annual fees for some credit cards – can become expensive over the years
➢ Fee charged for late payments
➢ Negative effect on credit history and credit score in case of improper usage

3. Debit Card:
Debit cards are the second largest e-commerce payment medium in India. Customers who want to
spend online within their financial limits prefer to pay with their Debit cards. With the debit card, the
customer can only pay for purchased goods with the money that is already there in his/her bank
account as opposed to the credit card where the amounts that the buyer spends are billed to him/her
and payments are made at the end of the billing period.
Advantages of Debit Card
➢ Easy to obtain: Once you open an account most institutions will issue you a debit card upon
request.
➢ Convenience: Purchases can be made using a chip-enabled terminal or by swiping the card
rather than filling out a paper check.
➢ Safety: You don't have to carry cash or a checkbook.
➢ Readily accepted: When out of town (or out of the country), debit cards are usually widely
accepted (make sure to tell your financial institution you’re leaving your city; to not have an
interruption in service).

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

Disadvantages of Debit Card

➢ No grace period: Unlike a credit card, a debit card uses funds directly from your checking
account. A credit card allows you to borrow funds on credit, leaving disposable cash in your
account.
➢ Check book balancing: Balancing your account may be difficult unless you record every debit
card transaction.
➢ Less protection: Most financial institutions will try and protect their customer from debit card
fraud.
➢ Fees: Using your debit card for ATM transactions may be costly if the ATM is not affiliated
with your institution.

List different Ways to make Internet Selling safe:

• Antivirus software packages: Antivirus software is a type of program designed and
developed to protect computers from malware like viruses, computer worms, spyware,
botnets, rootkits, keyloggers and such. Antivirus programs function to scan, detect and remove
viruses from your computer.
• Virtual private networks: A virtual private network (VPN) is programming that creates a
safe, encrypted connection over a less secure network, such as the public internet. A VPN uses
tunneling protocols to encrypt data at the sending end and decrypt it at the receiving end.
• Firewall: A firewall is a network security system that monitors and controls incoming and
outgoing network traffic based on predetermined security rules. A firewall typically
establishes a barrier between a trusted internal network and untrusted external network, such
as the Internet.

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

• Identity services: It is a network administration product that enables the creation and
enforcement of security and access policies for endpoint devices connected to the company's
routers and switches.
• Cryptography: Cryptography is a method of protecting information and communications
through the use of codes so that only those for whom the information is intended can read and
process it. The pre-fix "crypt" means "hidden" or "vault" and the suffix "graphy" stands for
"writing."
• Digital signature: A digital signature is a mathematical technique used to validate the
authenticity and integrity of a message, software or digital document.
• Cyber law: Cyber law is the part of the overall legal system that deals with the Internet,
cyberspace, and their respective legal issues. Cyber law covers a fairly broad area,
encompassing several subtopics including freedom of expression, access to and usage of the
Internet, and online privacy.

Digital signature:
Digital Signature is a type of asymmetric cryptography used to simulate the security properties of a
signature in digital form, rather than written form. Digital Signature is an electronic signature that can
be used to authenticate the identity of the sender of a message or the signer of a document, and
possibly to ensure that the original content of the message or document that has been sent is
unchanged.
➢ Digital signature schemes normally give two algorithms, one for signing which involves the
user's secret or private key, and one for verifying signatures which involves the user's public
key. The output of the signature process is called the "digital signature. “

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

➢ Digital signatures are easily transportable, cannot be imitated by someone else, and can be
automatically time-stamped. The ability to ensure that the original signed message arrived
means that the sender cannot easily repudiate it later.

Biometric Method and legal or regulatory environment:

Biometrics is the automated method of recognizing a person based on a physiological or behavioral
characteristic. Biometric technologies are becoming the foundation of an extensive array of highly
secure identification and personal verification solutions.
Biometric technologies should be considered and evaluated giving full consideration to the following
characteristics:
➢ Universality: Every person should have the characteristic. People who are mute or without a
fingerprint will need to be accommodated in some way.
➢ Uniqueness: Generally, no two people have identical characteristics. However, identical twins
are hard to distinguish.
➢ Permanence: The characteristics should not vary with time. A person's face, for example,
may change with age.
➢ Collectability: The characteristics must be easily collectible and measurable.
➢ Performance: The method must deliver accurate results under varied environmental
circumstances.
➢ Acceptability: The general public must accept the sample collection routines. Nonintrusive
methods are more acceptable.

PRADEEP ,ASST PROFESSOR ,KSSEM,8147544492,BANGALORE

 Sales Management – (18MBAMM401)

➢ Circumvention: The technology should be difficult to deceive.

LIST DIFFERENT TYPE OF BIOMETRICS TECHNIQUES:

➢ Identification and verification:
• Fingerprint scan
• Face recognition (Facial scan)
• Retina scan (Blood vessel)

PROF. PRADEEP, ASSISTANT PROFESSOR, 8147544492 KSSEM, Page

BANGALORE. 108