Sales Management and Sales Communication of SMEs

By Havlicek, Karel; Roubal, Ondrej | European Research Studies, October 2013 | Go to article overview

Sales Management and Sales Communication of SMEs


Havlicek, Karel, Roubal, Ondrej, European Research Studies


1. Introduction

In small and medium-size businesses it is often very difficult to distinguish the boundaries between marketing management and sales management. In many cases marketing and sales form one department that prepares sales and marketing plans. In any case it is not possible to simplify the actual sales activities and talk only about purchase and sales, but it is essential to view sales management as a complete process including sales management and sales controlling. Sales management is viewed as preparation of the main company document--a sales plan and controlling is viewed as management of ongoing sales forecasting and controlling of trade receivables.

Process management based on the M-C model can be defined as the Management Control System that includes a comprehensive view of management on the basis of management accounting, management theory and personnel management. It is an interdisciplinary management system where the most important thing is not the interface of the process but the understanding of business management as a whole, mastering planning tools based on research, objectives, visions and missions (management) and control tools based on evaluation of deviations and proposal of risk management measures (controlling). The M-C model shows that a successful business can work only if you manage to grasp all of its processes and understand their interdependence.

2. Sales Plan

The sales plan (sometimes referred to as a turnover plan which is a rather simplified term) should be prepared one year in advance and should be divided into respective months and quarters. Financial plans are based on the sales plans. A marketing plan must precede a sales plan; however, some smaller companies use only one plan, which is then called a sales and marketing plan. Sometimes companies ignore the marketing plan and use only a sales plan to manage sales. From a short-term point of view it is possible, but in the long run this cannot be effective as sooner or later the company loses touch with market reality. The plan is copied, more or less automatically, every year and is based on the history of revenue and intuitive estimates of salespeople (Havlicek, 2009).There are no innovation impulses, there is no capturing of new trends, no feedback, there is no control of competition, communication with customers is chaotic, distribution lacks any concept and prices are often determined randomly, or they are dictated by the 3 3 customer, regardless of the overall market situation and the overall standing of the business.

2.1 Distinguishing sales plans

The basis of sales plan management is to view its components (most often the turnovers) from several angles and to eliminate the risk of a one-sided view of the market. The most common viewpoints are the product viewpoint, customer viewpoint and geographical viewpoint. By doing this we create a basic controlling mechanism which minimises the error rate of sales planning. The overall sales plan is usually divided (Figure 1) by:

* product groups (sometimes stated by production ranges or product lines),

* customer segments or specific important customers (if mixed, by stated product groups and territories),

* territories (foreign territories are shown separately, individual regions can be shown as sub-groups or territories can include continents).

[FIGURE 1 OMITTED]

Sales plan objectives are specific numbers shown in world currencies (usually in the form of turnover, also showing sales margins, added value etc.) or units of measures. Sales plans are commonly prepared in combination with sales in specific currencies and it is also shown how many units of measures of specific products must be sold by the company.

2.2 Preparing a Sales Plan

Data from past periods

This is the simplest and most accessible method when we can see what was sold in the respective product groups, territories and customer segments in past periods. …

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