ASSIGNMENT

MK0010 SALES, DISTRIBUTION AND SUPPLY CHAIN MANAGEMENT

Name 1205006802 Learning Centre : AIM Computer Education Learning 02030 ------------------------------------------------------------------------------------------------------------------------------------Q1. Explain the classification of retailer in detail. Answer: Retailing includes all activities involved in selling or renting consumes products and services directly to ultimate consumers for their household use. In addition to selling, retailing includes such diverse activities as buying, advertising, data processing and maintaining inventory. Classification of Retailers There are basically three types of retailers and these are: Store Retailers Non-store Retailers Retail Organizations Centre Code : : Ajit Kumar Registration No. : MBA: Semester III

Store Retailers In this category we can classify the following retail outlets: Specialty Store: These stores sell a narrow product line but offer a variety in these lines of products. Departmental Store: As the saying goes, these stores sell from a pin to an elephant. They have a broad product line. Each line of product is a separate wing or a floor or a department. Super Market: These super markets have goods selling at competitive prices. Convenient Store: These cater to the needs of the people living in adjoin areas and keep products that are frequently required. Discount Store: As the name suggests these stores offer products at discount and are very popular. Off-price Stores: These Stores sell at a price lower than ordinary retailers but higher than wholesalers. Super Store: These are very large stores and meet the total needs of consumer and have almost everything to offer. Catalogue Show Room: Catalogues are posted to consume who go through the details of the products which are illustrated with their uses and prices given in details.

Non-store Retailers These types of retailing can be categories into four types: Direct Selling: This can take the form of personal selling where salesman & sales woman go from door to door with or without appointments. Direct Marketing: It is done direct mail or catalogue marketing in this kind of direct marketing, importance is given to promotion price discounts etc.
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Automatic Vending: This is done through vending machines where could drinks, cigarettes, chocolates, coffee, tea etc. can be served automatically by inserting coins and pressing a button. Buying Service: This service is provided by individuals who do not own a store but get products cheaper rates from a set of stores.

Retail Organization Some of these retail organizations are discussed below: Corporate Chain Store Voluntary Chain Retailer Co-operatives Consumer Co-operatives Franchise Organizations Merchandise Conglomerate Self Service and selection Customer Sort-out Limited Service Full Service

Q2. Describe the four principal component of Physical Distribution management. Answer: Principal Component of Physical Distribution Management (PDM) There are four principal Component of PDM and these are: Order Processing Stock Levels or Inventory Warehousing Transportation

Order Processing: Order processing is the first of the four stages in the logistical process. The efficiency of order processing has a direct effect on lead times. Orders are received from the sales department. Order-processing systems should function quickly and accurately. Other departments in the company need to know as quickly as possible as an order has been placed and the customer must have rapid confirmation of the orders receipt and the precise delivery time. Stock Levels or Inventory: Inventory or stock management is a critical are of PDM because stock levels have a direct effect on levels of service and customer satisfaction. The optimum stock level is a faction of the type of market in which the company operates. Stocks represent opportunity costs that occur because of constant completion for the companys limited resource. If the companys marketing strategy requires that sign stock levels be maintained, this should be justified by a profit contribution that will exceed the extra stock carrying costs. Warehousing: May companies function adequately with their won on-site warehouse from where goods are dispatched direct to customers. When a firm markets goods that are ordered regularly, but in small quantities, it becomes more logical to locate warehouses strategically around the country. Transportation: Transportation usually represents the bulk of distribution cost. It is usually easy to calculate because it can be related directly to weight or number s of units. Const must
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be carefully controlled through the mode of transport selected amongst alternatives, and these must be constantly reviewed. Q3. Discuss the formulation of Sales strategy in brief. Answer: Formulation of Sales Strategy: Strategy formulation in case of sales would involve identification of the sales goals and designing of a game plan, using the organization resources at hand achieve those goals. The strategy formulation process can be shown as:

Macro Environment Analysis: Social Political Economic Technology Assessment of the competitive situation and the corporate goals to determine the output that sales management is expected to give.

Step 1

Step 2

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Market Analysis

Design sales strategy by deciding upon: 1. Type sales of Sales efforts Define management required objectives in terms of 2.delivering Type of sales personnel these outputs required both quantities and 3. Size of the sales force qualitative 4. Territory Design 5. Channel Support and coordination Step 3

a) b) c) d)

Assessment of competitive situation and corporate goals Setting sales objectives Determination of the type and size of sales force needed Organization the sales effort territory design Geographical Basis Sales Potential Basis Servicing Requirements Basis Workload Basis

e) Establishing and managing channels support and coordination Q4. Compare and contrast the various types of sales organization structures. Answer: Sales Organization Structure: Sales organization developments refer to the formal, coordinating process of communication, authority and responsibility for sales groups and individuals. Difference between types of sales organization structures: 1. Organizing the Sales Force: An effective sales force is a powerful asset for any company. Doctors & physicians in United States have consistently ranked Pfizers sales force as one of the best in the pharmaceutical industry.
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As a result, when Parke-Davis launched its blockbuster cholesterol-lowering drug, Lipitor, it entered into an alliance in which Pfizers sales force helped selling the drug to physicians throughout the United States. A companys management process is fundamentally affected by the firms overall business strategy and its strategy for accessing its target markets. The relationship between business strategies, a firms marketing strategy, and a firms strategic sales force program is discussed in this unit. Sales force organization is primarily a function of properly sizing the sales organization to assure that customers and prospects receive appropriate coverage, company products get proper representation, and the sales force is stretched but not overworked. The appropriate planning of the sales force will also depend on the size of the opportunity a firm faces and its expected sales level. 2. Roles & Structure of the Sales Force: To be successful and produce profitable results, the sales force must implement a firms business strategy and market access strategy. In other words, strategic plans are implemented through the activities and behaviours of the sales force. Key sales force behaviours include calling on certain types of customers and prospects, managing customer relationships and creating value for individual customers. The role of the sales force in implementing a firms market access strategy is very important. To meet customer needs efficiently and effectively and to sell the firms products and services, a sales force must be well organized. Sales force structure decisions influence how customers seethe firm because sales force structure will affect the selling skills and knowledge level required of salespeople. In turn, sales management activities such as compensation, recruitment, training, and evaluation are affected. 3. Building Sales Competencies: Sales managers are responsible for hiring salespeople with the appropriate skills andba ckgrounds to implement the sales strategy. Good sources must be found for new hires, and those who are weak in these areas must be carefully screened out. In addition to hiring qualified people, salespeoples competencies are usually developed through training before they are sent into the field. Sales managers are responsible for making sure that training is completed, and they often conduct some of the classes. Most initial training programs are designed to familiarize salespeople with the companys products, services, and operating procedures, with some time devoted to development of selling skills. Because sales training is expensive, the sales manager is responsible for selecting the most cost-effective methods, location, and materials. 4. Leading the Sales Force: Effective sales managers know how to supervise and lead their salespeople. Sales managers provide leadership by inspiring people to grow and develop professionally, while achieving the revenue goals of the firm. Good leaders provide models of behaviour for employees to emulate, often developing strong mutual trust and rapport with subordinates. Leadership styles vary, but effective leaders are adept at initiating structure that is, organizing and motivating employees, setting goals, enforcing rules, and defining expectations. In addition to leading the sales force in business results, sales managers are also expected to lead by example in encouraging ethical behaviour within the sales force. Salespeople are continually confronted with ethical dilemmas. Sales managers use a variety of tools in their efforts to motivate salespeople to work more efficiently and effectively. 5. Goal directed effort: There are many techniques that have proved to be effective motivators, including sales meetings, quotas, sales contests, and recognition awards. The most powerful motivator for salespeople is often a well-designed compensation package. Money is an important
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consideration for attracting and motivating people to work hard. A key task for sales managers is to devise an effective mix of salary, bonuses, commissions, expenses, and benefits without putting the firms profi tability in jeopardy. 6. Evaluate the performance of the sales force: The final step in the sales management process is to evaluate the performance of the sales force and develop the skills of their people. This involves analyzing sales data by account, territory, and product line breakdowns. It also means reviewing selling costs and measuring the impact of sales force activities on profits. Q5. Explain the formulation of Sales organization. Answer: Formulation of sales organization: These are the step of formulation of sales organization. Step 1 Sales Strategy: The first step is to segment the population into different categories, by using various methods of segmentation. The population can be segmented on the basis of demographics, location, psychographic etc. mostly the segments with similar sales processes are identified so that they could be easily targeted by the sales organization. Step 2- Marketing Strategy: At this stage, the ways to inform customers about the product and services available and ways to reach them are decided. The company decides the channel through which it will reach the prospective buyers. Some companies adopt and indirect channel including intermediaries and some adopt a direct approach. Step 3-Sales Force Design: At this step, the sales organization decides the structure of its sales force. It decides the roles of different sales person, number of sales persons to be devoted to a particular segment, the formal relationship between sales persons, appraisal and evaluation methods, compensation etc. Q6. Describe the types of sales strategies. Answer: Types of sales Strategies: The various types of sales strategies are discussed in following sub-sections. 1. Relationship Strategy: Establishing and maintain a partnership-type relationship internally as well as with the customers is a vital aspect of selling. In this strategy, a major key to success in selling is the ability to establish working relationship with customers in which mutual support, trust and goals are nurtured over time. 2. A Selling Partner: P -Prapares strategically for long-term, high-quality relationship that solve customers problems. A -Asks questions to get on the customers agenda R -Restates customer needs with confirmation questions T -Team with support people to provide the customer with solutions N -Negotiates double-win solutions with joint decision making E -Exceeds customer expectations whenever possible. R -Re-examines the ongoing quality of the relationship frequently. 3. Double-win Strategy:
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In this strategy, both the customer and the salesperson come out of the sale with a sense of satisfaction. The salesperson not only obtains the order but sets the stage for longterm relationship, repeat business and future referrals. 4. Instant Service Strategy: It is in this context of providing almost instant service to the customer that the concept of supply chain management has caught the imagination of managements the world over. 5. Hard & Soft Sell Strategy: The main purpose of a salesperson is not just to make sales but to create customers. Indentifying potential customers is an important aspect of customer strategy. Every salesperson must cope with the inevitable loss of customer over period of time, which can be attributed to a variety of causes. 6. Integrated sales strategies: Sales and distribution management constitutes one of the most important areas for customer satisfaction. Sales management has been defined as the management of a firms personal selling function while distribution is an indirection function. Therefore, integration is required between sales and distribution functions. 7. Client-centered selling strategy: Client-centered selling strategy focuses the entire selling process and efforts on the clients needs, problems and successes. It considers who the client is what he or she does and where, when, why and how he/she does it. It demands the fullest knowledge of the client as an individual and as a member of a professional network involving everyone who may interact with him/her in his/her work.
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