Sales & Distribution Management

Chapter 6 : Sales Planning

+The Importance of Sales Planning

+Sales Manager as Planner and Administrator

+The Sales Planning Process

+Causes of Unsuccessful Sales Planning

 Accuracy of Sales Planning

Chapter Summary

Most organizations find themselves operating in highly competitive markets with varying customer needs and expectations. This has made them redefine the importance of meticulous planning to be successful in the globalized environment. An understanding of the sales planning process is essential to effectively manage the sales management function. It provides a framework and direction to all actions involved in sales management. It also helps sales personnel understand where the organization is headed, how it will reach the desired position and what activities must be undertaken to fulfill the organization’s mission.

Sales planning is very important to an organization because it helps in better implementation of plans, provides a sense of direction, improves coordination and control and reduces uncertainty and risk. The sales manager’s role has gradually shifted over the years to that of a planner and administrator. As a planner, the sales manager has to forecast, develop objectives, design the sales organization, formulate policies, procedures and standards and prepare sales budgets. As an administrator, the sales manager has to supervise, coordinate, delegate and motivate the sales force.

Managers must also ensure that ethical standards are followed by the sales force during selling. The planning process involves - setting objectives, determining operations to meet these objectives, organizing action, implementing the sales plan, measuring results against standards, re-evaluating, and control of the sales force performance. Most plans fail due to a host of reasons. The primary reason is the habit of sales managers to duplicate the successful plans of other organizations without trying to understand the specific requirements of their organization.

Lack of awareness of important aspects, absence of proper planning, absence of sales force participation and lack of effective communication of planning elements also lead to failure of sales plans. The accuracy of the sales plan is dependent on the time- frame. Plans are generally accurate for shorter time spans than for longer periods. The rate of profits, size of the organization, involvement of top management, communication and sales force participation affect the accuracy of the sales plan.

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