5Cs of Sales Management

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Parag Utekar
Student (MBA), India

5Cs of Sales Management

Marketing could be defined as getting the right product to the customer at the right time and in the right place. Whether this happens or not would, especially in B2B Marketing, depend to a large extent on how well the sales structure is organized. When considering Sales any company must consider five main factors all starting with a C when making any major decisions wrt Sales: Capacity, Control, Coverage, Cost, and Conflict.
  • Capability: The starting point of any sales decision is to assess whether the company has the ability to create a sales force with the necessary skills to meet the customer requirements. The company should ask questions like "What do we need our salespeople to do?" and "Are the available, recruited salespeople capable of completing the tasks?" The company should also consider the tradeoffs involved in serving the customers in other ways, such as a distribution channel with agents or value-added retailers.
  • Control: A direct sales force provides companies with a better, immediate (direct) control over their interactions with the customers. Selling directly allows companies to (among other things):
    • Keep their customers private.
    • Develop consistent, "intimate" contacts with the customers and get an unfiltered response to its offerings.
    • Accomplish high levels of customer loyalty leveraging product expertise.
    • Set sales target for individual salespeople. Sales target serve as a motivation and forecasting tool and (under normal circumstances) guarantee some level of revenue.
  • Coverage: Companies can use multiple sales reps and outside agents to generate a greater reach in the market, by using these benefits:
    • Different types of selling skills.
    • New types of customers.
    • Broader geographical regions.
  • Cost: The cost of serving customers using a dedicated sales force has to be considered. The greater control and greater coverage is achieved at a greater cost. On the other hand, also the cost and risks involved in working with an indirect sales force should be compared. The salaries of direct salespeople can be high, but they often have considerable variable components in their pay structure which is only owed in case of success.
  • Conflict: One conflict in a sales organization can arise when two or more people are assigned or claim the same customer. Establishing a system administering which client belongs to whom can help, but conflicts can still arise. In case a company opts for a multi channel marketing strategy, another conflict is dealing with channel conflicts between direct sales and the indirect channel.
⇒ Do you agree these are the main 5 factors that affect sales management?

Source: Steenburgh, T. (2006). Personal Selling and Sales Management, Harvard Business School, 507039 .

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