Hrm 531 Week 3

PRODUCT MANAGEMENT (FINALS)

March 26, 2014

What will you do to be able to design your sales quotas and sales territories? Why? How would you handle the assigning & organizing of your salespeople/sales person?
Should Krisha will be benefit more if she choose to market her product in and around Luzon, or it will be profitable to market in a large segregate with high market potential?

OBJECTIVES Achieve your sales budget of 1,000,000 numbers in the first year and a growth of 25 percent per year for subsequent 4 years. Make your product (Swish flow fan) more affordable but still can meet your target sales. Monitor salesperson’s performance by means of activity evaluation
during their assign period.

ASSUMPTIONS You need to design sales territories to reach your target sales budget of 1,000,000 numbers in the first year and a growth of 25 % (quotas). The establishment of sales territories and sales quotas represents management need to match personal selling effort with sales potential (opportunity). That's why, you must assign salespeople, who will response to target consumers (household and commercial organizations), accordingly in a segment.
AREAS OF CONSIDERATION STRENGTH Eliminate future discrepancy between what you thought you're sales will be and the actual sales

Evaluate performance of the assign salesperson

Motivate assign sales person based on their performance (through compensation)
WEAKNESS

May show only inaccurate forecast sales (estimate) and may vary based upon the assign task in salesperson

OPPORTUNITIES Awareness of the possible result that may take using the alternative solution

Knowing what department or area you need to consider to manage for her sales interaction
THREATS
All territories will not have equal potential. All salespeople will not have equal ability and assignments may have to be made accordingly The sales task in each territory may differ from time period to time period

ALTERNATIVE COURSES OF ACTION & EVALUATION

But if you'll assign quotas not only for estimate sales but also for each major selling function, then you will be able to comply your weakness.
You may also use the method of relate sales to forecasted sales potential. (Activity evaluation) This forecast must include a sales expense budget. ADVANTAGES
Controlling selling expenses and time
Knowing whether your quotas will be the same as your actual sales more. It allows you to plan the best way to take an edge than your competitors.

It forces you to continually think about their future and where their company is headed.
This will allow them to foresee changing market trends and keep up with the competition. As a manager you'll be able to evaluate your sales force performance better.
CONCLUSION AND RECOMMENDATION

I would consider using all of the alternatives to boost and maximize its accuracy and make sales up to 1,000,000 / year. Therefore I will use the method of relate sales to forecasted (include sales expense budget) Even though Cebu and Davao is the place where Anna want to market her product (consider it as large geographical areas) it may involve high risk for her. So I would rather consider Luzon (manila) as her sales territories that in reality have a high market potential for achieving the sales despite of how Cebu and Davao are large segregate. So, if in 1 territory have estimate industry sales potential for Swish flow fan of 1,000,000/ year, the quota might be set at 25 % of the potential or 250,000. The 25% figure represents the market share of growth that Krisha estimates to be a reasonable target. This 250,000 quota may represent sales over last year that is expected from recently new launch products.

PLAN OF
ACTION

First, for effective forecast, effectively dating of each sale must take into account. Since this is a yearly evaluation, data and results should be shown by period. The results of 1,000,000 sales budget must be attain at a year and the 25% growth per year for subsequent for years. The risk involved here is that the chosen market area may have a large number of competitors at the same industry.
Since your sales territories are within Luzon were your sales office was located, resources needed are reachable and process of sales will be easy. So, you may sell your products with ease and you can market your product accordingly consider your office is near and reachable for communication with other department. Second, consider the number of sales calls and expenses and must be included. This will give your evaluation a complete data of possible sales from quotas. Third, planning the sales calls is a one factor to be considered. It's a source of future sales and may build customer relationship. Fourth, to be able to achieve your sales quotas, it is not enough to rely on sales forecast but opposing exert an extra effort in selling by means of good sales strategy.
The expected results (shown in table below) may help you to evaluate performance, each activity is assigned a quota (250,000 that will results to 1,000,000 sales and 25% growth) and a weight reflecting its relative
importance.

Territory
Luzon(manila)
Salesperson
Anna Krisha
1
2
3
4
5
Functions
Quota
Actual
Percent
Weight
Score
Sales Volume

Old product
150000
121500
81.00%
0.8
64.8 (Doesn't Attain) Swishflow fan
250000
250000
100.00%
0.5
50 (Attain Quota)
Calls on Prospects

Household
120
144
120.00%
0.2
24
Commercial Organization
80
80
100.00%
0.2
20
Performance Index
(for salesperson evaluation)

158.8 MM Company (SwishFlow fan) Sales Activity Evaluation