IMT-30: Sales and distribution management

IMT-30: Sales and Distribution Management

PART - A

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Q1. In what ways should a sales representative function as a marketing manager? What should be the responsibilities of the professional sales representative to the customer? Is personal selling an effective means of sales promotion?

Q2. Compare and contrast the workload and the incremental productivity approaches for determining the optimal size of a sales force. Which do you think is better? Why?

Q3. What steps are involved in the selection process of sales personnel? Why is it important to have a well-planned selection process? What are the basic tests that can be used in the selection process with the purpose of each test?

Q4. "Good sales people are born not made". Do you agree or disagree? Do you think sales training programmes will become more or less important in future? Why ? Discuss the five basic elements that all initials sales training programmes must cover.

Q5. How can activities of the sales manager such as planning, recruiting and selecting affect sales force performance? Is it possible for a salesperson to perform well when he or she is different in only one of their approaches of their internal influences i.e. motivation, attitude and skill level? Why or why not?

PART - B

Q1. Why is it necessary to establish sales territories that are equal? Is it important to match the right sales person with the right territory? Why are goals necessary for both the sales person and sales manager?

Q2. Can you establish a quota without a sales forecast? A sales budget? An estimate of the territory's potential? Explain three basic procedures for setting sales volume quotes.

Q3. Do you believe that most salesperson can be effectively 'steered' by financial compensation? Explain. What compensation mix do you think is best for large factory machines? What are the essential criteria for designing and implementing a sound bonus incentive programme?

Q4. "We will ever develop accurate standard costs for marketing activities". Explain. What is a good SMIS? How does it work? What are the major components of an SMIS?

Q5. Are middlemen necessary in a marketing channel? Why or why not? How do channels adjust quantity and assortment discrepancies? Explain whether the shorter channels more effective than the larger channels?

PART - C

Q1. What is the importance of channel structure in making managerial decisions? Why single transaction and conventional channel arrangements are important channel design alternatives. ?

Q2. Describe intensive, selective and exclusive distribution and give examples taking specific firms. What is the difference between exclusive territorial arrangements and exclusive dealing?

Q3. How does a product's life cycle stage impact its distribution channel structure? To support your conclusions, give examples of products in each stage. Describe the differences between manufacturer's push strategies and pull strategies.

Q4. Why is trucking often referred to as the backbone of the nation's transportation system? Explain the difference between speed of service and consistency of service. Why do most logistics managers feel that consistency of service is more important than speed of service?

Q5. How would you suggest that the effectiveness of distribution be assessed from a macro perspective? For example, can market decentralization and product variety be measured.

CASE STUDY-1

SUVIDHA'S INCENTIVE PLAN

Suvidha Home Appliances Company pays its sales people well. They are on expense account. Their promotional prospects are bright. They get an opportunity to travel to exotic places as a reward for their service. Many sales people draw five figure salaries.

Suvidha has thought about an incentive plan to keep the sales people motivated. It has started to think of ways and means to compensate sales people without increasing their tax liability. It has thought of providing the sales people a catalogue of household items which can be obtained by redeeming the points earned by them on the basis of performance. It will provide good opportunity to sales people to point out to others with a great degree of pride what they have achieved by showing the household item, and then explaining how they won it.

They also want to introduce a travel plan, because a travel to beautiful locales home and abroad is an ultimate dream of many people. Travel plan scores over reward redemption scheme because a reward that is repeated does not have incentive value, whereas a travel plan, though repeated keeps up its incentive value. Travel plan is also a family affair.

Question

Can you think of some more incentives for Suvidha's sales people ?

CASE STUDY-2

Will Added Channels Pump Up GOOD YEAR'S Sales?

Goodyear Tire and Rubber Co. and its dealers had a srious problem. The long-standing relationship between Goodyear and its dealers was not in tune with the desires of much of the tire-buying market. Even Stanley Gault, Goodyear's chairman since mid-1991, recognized that his company was "not serving the market with what the customer wanted."

More and more consumers buy tires at outlets that stock multiple brands at discount prices or at big warehouse clubs that carry fewer brands but offer steeper discounts. In contrast, Goodyear persisted in selling its tires only through its company owned stores and independent dealers that featured the company's products. Besides this deficiency in its distribution, the company had other problems, such as too few new products. As a result, its share of the replacement tire market for automobiles slumped from 15 percent in 1987 to 12 percent in 1991. Michelin of France and Bridgestone of Japan gained at the U.S. tiremaker's expense. Moreover, Goodyear lost money in 1990, the first unprofitable year for the company in about 60 years.

Independent dealers depending on Goodyear products were not faring much better. Consumers wanted to shop a full range of prices at a tire dealer, but Goodyear was slow to respond to what consumers wanted. Consequently, Goodyear's dealers lost sales to competitors. Eventually, and perhaps too late, the company provided dealers with cheaper All American Decathlon and Concorde lines of tires.

In early 1992 Goodyear took a bold step toward reaching more consumers - the company arranged to sell seven of its tire lines through Sears. The Goodyear brands supplied to Sears include the popular Arriva, Eagle GT, and Wrangler HT,. The agreement was a logical step for Goodyear, since Sears sells more tires than any other retailer - about 10 million annually, or 10 percent of the replacement tire market. Through its arrangement with Sears, Goodyear hoped to add an other 25 million tires to the 60 million it sells each year.

Goodyear, under Gault's leadership, has strengthened other elements of its marketing mix. New products are being launched at a faster pace. The leading introduction thus far has been the Aquatred, which is supposed to provide superior traction on wet roads. In addition, Goodyear has boosted its advertising budget by one-third, to $50 million annually, to better promote its growing number of tire lines. At the same time, the company has made more advertising dollars available to its dealers on a cooperative basis.

Early results following the sweeping changes in Goodyear's marketing including its arrangement with Sears, have been encouraging. The company regained market share and recorded strong earnings in 1992.

Still, the road ahead could be bumpy for Goodyear. In particular, many of its long standing dealers were angry or alienated - or both - when the manufacturer expanded its distribution channels to include Sears. Some are still upset that they lost their exclusive rights to the well known Goodyear brands. Others fear anticipated price competition with Sears. One Goodyear distributor said, " You feel like after 35 years of marriage your wife is stepping out on you." Goodyear recognizes that when several thousand members of its primary distribution channel are upset, all's not well'.

Question

All factors considered, is Goodyear's agreement with Sears a sound distribution strategy?

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