116 Sales and Distribution Menagement
Case 4.1 cc Engineering Company—Achieving Quotas
[Ashok Desai was transferred ftom western region, where he worked as area sales manager of CG Engineer
ing Company, to easter region as regional marketing manager—industries. He was told by the companys
general manager (Sales) that he was transferred from western region to eastern region to set things right,
2s eastern tegion was nor performing well on sales and profits. Ashok’s main responsibilities were to mam
faze effectively 1 sales engineers and achieve the sales volume and contribution (to profits) quotas. For
[Ashok not only the industrial customers but also the sales engineers were new. The sales engineers were
compensated based on straight salary and perquisites like house rent allowance and medical reimbursement.
[There was no incentive scheme. The territory af eastern region consisted of states of West Bengal, Bihar
‘Assam, and Orissa, Ashok fele that the sales engineers were not covering the market adequately and were
not following any system of routing and scheduling. He also thought that salespeople were spending more
time in travelling and less time in selling activities. After ralking to sales engineers individually, he got an
impression thac most of them were not motivated, as they were not given adequate freedom of operations
Jand recognition whenever they got good orders. Ashok thought that there was a good scope of applying
what he had learnt in the management institute and achieve superior results as expected by the general
manager Sales)
[Question: Ifyou were Ashok, what would you do to achieve the sales volume and contsburion quotas?
Case 4.2 MM Marketing Company—Territory and Quotas
for a New Product
Krishna Kumar, the marketing manager of MM Marketing Company was thinking how to go about de
signing sales territories, assigning salespeople tothe territories and setting sales quotas, particulary as the
Product was new: The new product, called Swishflow fan was a unique kind of a table fan with attractive
ai-conditioner lke looks. Considering the initial production capacity of 1,00,000 nurabers in the fst year
Krishna Kumar decided to market the product in and aroun Mumbai, where the marketing and sales office
was located. The target consumers were household as well as commercial organisations, who could use this
product as table-fan and wall-mounted fan
Krishna Kumar thought chat the territory design should include geographical areas with high market
potential for achieving the sales budget of 1,00,000 numbers in che first year and a growth of 25 per cent pet
year for subsequent four years. He calculated a salesorce size of seven numbers, and decided to launch the|
Product intially in major metos and cities in Maharashtra and Gujarat. Krishna Kumar was ofthe view that
sales quotas should consider sales volume, selling expense, and also number of sales cals per day, in order
fo have a proper control on salespeople. He wondered how to design sales terstories, what criteria should
he consider while assigning salespersons to territories, and how to design the sales quotas considering the!
factors mentioned above.
[Question: If you were Krishna Kumar, what will you do and why?