Summary

Chapter 11

Sales Department Relations

Learning Objectives

 This chapter will help you understand the types of sales department relations and their
importance for the effective growth of sales.

11.1 Introduction

Reputation of an organisation rests on the effective functioning of the sales department. Sales
Department leads the company’s efforts in the supply increasing quantities of products to the
customers. Success of an organisation depends on the relationships and associations established
by the sales department with the customers and the other public.

A sales department leads the company’s efforts in providing an ever-increasing quantity of

products/ services to the customers. This activity can be performed with profit only if the sales
department functions effectively in coordination with other departments which help it to make
things happen. The success of effective selling depends on the relationships and associations
established by the sales department with the customer and the public. The sales person generally
has close relationship with department heads and external publics and is responsible for
maintaining excellent relationships with all those external publics who help him in planning and
administering sales programs. The sales person should understand the functions of other
departments and develop a harmonious relationship to accomplish maximum progress in the
company’s goals and objectives.

11.2 Types of Coordinating Methods

Though the top management is overall responsible for coordinating the activities of the company
for maximum progress, the sales person must understand how other departments influence his
progress and how the other departments are influenced by the sales department. The sales person
generally coordinates with other department in two ways: viz

(a) The Formal Coordinating Method : Group related activities, plans, policies, meetings
help in achieving formal coordination. Such meetings are generally presided by the
Chief Marketing Officer or a senior executive of the company and the heads of
departments performing various marketing and sales functions attend such meetings.
Companies can have such meetings at the branch level in the form of staff meetings
 in which all the departmental heads of the branch participate in the meeting to cover
all aspects of product distribution including advertising and operations.
(b) The Informal Coordinating Method : Informal coordination methods are more
effective than the formal coordinating methods. It is not always possible to have
formal coordinating methods while following the flow of the process. The sales
person may solve the problem informally and seek its formal approval later,
depending upon the urgency of the issue. Unexpected problems which should be
resolved with minimum delay are generally solved by the informal coordinating
method. Sales persons require regular communication with their departmental heads
for closing a deal based on the profile of the customer.

11.3 Coordination of sales persons with Personnel department

Personnel department is into training, selection, recruitment and motivating of employees. Sales
persons and personnel department have to work together in formulating policies in establishing
policies for recruiting, training, compensating and motivating the sales force. Most sales persons
are not adequately equipped to service sales personnel’s personal problems like leaves, sickness,
entertainment, refreshments, conveyance, pensions, safety, health checks etc. Personnel policies
are decided through formal coordination while the routine matters are informed through informal
coordination.

11.4 Coordination of sales persons with finance department

The sales department helps the Finance department to arrive at a realistic sales budget by doing a
thorough market and customer research. Based on the sales budget a formal coordination of top
management happens on deciding the pricing and sales promotions. The Finance department
helps the Sales department in providing credit checks on prospective customers and thus
identifies new account acquisitions. The salesperson also helps in making collections and
securing credit information.Coordination of Sales department and Finance department happens
informally during mutual effort to overcome nature conflicts of interests in credit policy. The
sales persons generally want to offer liberal terms to the prospective and existing customers
while the Finance department generally do not think in the same way as sales persons. Close
coordination is necessary for the benefits of both Sales and Finance departments.

11.5 Sales and marketing information

The marketing information system assists the Sales department to gather data on customer’s
sales, trends, patterns for analyzing the sales problems and identifying solutions. The exception
reports such as sales persons failing to achieve quotas, sales activities exceeding budgeted
expenses, territories in which the competitive position is being lost, customers with declining
purchases and product lines having slow movement help the sales department to implement
quick curative actions.
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