PILGRIM DRUG COMPANY

GROUP 3
17P035 NAYAN MANCHANDA
17P066 AKSHAY KHUNTETA
17P071 ANNIE COCILA KHURANA
17P122 AAKRITI KHUNTETA
 Company & Syracuse Division
Background
• The Syracuse division of Pilgrim Drug was one of 74 wholesale drug divisions in the United States owned by
the firm. Each division acted as a fundamentally autonomous unit, maintaining its own warehouse, sales,
purchasing, and accounting departments
• As a wholesaler, the Syracuse Division sold a broad product line of approximately 18,000 items to retail
druggists
• The share of the wholesale drug market controlled by the Syracuse division was below both the median and
the mean for other Pilgrim Drug divisions
• Competition: two wholesalers – one carried substantially the same line of products as Pilgrim Drug; the
other carried a more limited line of drug products
• David Thomas, formerly an assistant to the vice president of sales at Pilgrim Drug, was transferred to the
Syracuse Division as division sales manager to help turn things around at the underperforming division
Sales Management at Pilgrim
Three-step sales plan for increased profitability

Sales of larger quantities Sales of larger total value Because some

of an item or of high- were encouraged manufacturers offered
value items were because the profit made margins considerably
encouraged because the on sales to an individual larger than others, sales
cost of processing and account is related closely of higher-margin items
filling each line of an to delivery expense were encouraged
order was practically which remains more or
constant less constant
Other Case Facts

• The territory is divided into parts geographically

• The commissions given are based on product mix, rolling
commissions, or product margin
• Thomas aims to – reorganize the existing sales force; look at
strategy and policy enforcement and; selection and training of
future employees
• The issues that the Syracuse Division faced were – seniority-
related issues and territory issues among others
Solution

• Accounts need to be shared by old and new reps

• There should be quotas for higher margin products

• Compensation should be a mix of salary and commission

• The behaviour of sales reps needs a monitoring mechanism – via account check-sheets and call records

• A retreat can be organised for sales reps of the Syracuse Division and otherwise to develop a positive
relationship between old and new reps
THANK YOU