September 24, 2021

STRATEGIC CUSTOMERS PLANNING High performing salespeople tend to be strategic problem solvers for their customers. The top salespeople who are effective strategic problem solvers have the skills and knowledge to be to: Uncover and understand the customer’s strategic need by gaining an in-depth knowledge of the customer’s organization. Develop solutions that demonstrate a creative approach to addressing customer’s strategic needs in the most efficient and effective manner possible. Arrive at a mutually beneficial agreement. Critical key terms to strategic problem solving:- Strategic needs Creative solutions Mutually beneficial agreement Strategic needs The salesperson who understands the full range of customer’s needs is in much better position to provide a product solution that helps the customer progress more efficiently and effectively towards achieving her/ his organization’s strategic goal. “The top salespeople have an in-depth understanding of our needs,” said one business purchasing agent. “They can match-up their products with these needs to help us reach our goals”. Creative solutions For each customer a salesperson is often faced with specific, unique set of problems to solve. As a result, each customer requires a specific solution from the sales organization. The ability of a salesperson to tailor a ‘custom’ solution for each customer is critical today. The salesperson needs to use creative problem solving technique to identify the specific problem that meets each customer’s needs. Mutually beneficial agreements To achieve a mutually beneficial agreement, salespeople and customers must work together to develop a common understanding of issues and challenges at hand. Information about an organization’s business strategies and needs is often highly confidential. But more and more customers in the interest of developing solutions that will achieve their strategic goals are willing to let salespeople to cross the threshold confidentially. In this case there is collaborative (win-win) agreement rather than the adversarial (win-lose) agreement.   The customer relationship model   The customer relationships model brings together the main elements of consultative selling. The model shows that the customers have strategic needs salespeople must meet through creative solutions. In doing so, both buyer and seller benefit. The customer reaches its goals, as does the seller. This result in the seller being able to sell to the customer again, again and again thus building a long-term relationship. Strategic customer sales planning is extremely important to the success of today’s salesperson. Pre-approach refers to the planning the sales call on a customer or prospect.                                    Customer relationship model                                           Reasons for planning the sales call This is the key to sales success. There are four frequently mentioned reasons. Builds self-confidence Sales call planning can greatly reduce nervousness and increase self-confidence. It is also important also in making a sales presentation; you increase confidence in yourself and your ability as a sales person. This is also important in sales call. Develops an atmosphere of Goodwill The salesperson who understands a customer’s needs and is prepared to discuss how a product will benefit the prospect is appreciated by the buyer. Knowledge of a prospect and concern for the prospect’s needs demonstrates a sincere interest in a prospect that generally is rewarded with an attitude of goodwill from the prospect. This goodwill gradually aids in building the buyer’s confidence and results in a belief that the salesperson can be trusted to fulfill the obligations. Creates professionalism Good business relationships are built on your knowledge of your company, industry and customer’s needs. Show prospects that you are calling on them to help solve their problems or satisfy their needs. These factors are the mark of professional salesperson who uses specialized knowledge in an ethical manner to aid customers. Increases sales A confident salesperson who is well prepared to discuss how products solve particular needs always will be more successful than the unprepared salesperson. Careful planning ensures that you have diagnosed a situation and have a remedy for a customer’s problem. Planning ensures that a sales presentation is well thought out and appropriately presented.                                               Elements of a sales call The sales call objective is the main purpose of a salesperson’s contact with a prospect or customer.   The pre-call objective Selling starts with setting a pre-call objective. This is because a sales call must move systematically toward a sale. Taking time to set a pre-call objective is very important. Before every sales call ask yourself “what am I going in here for? What is the result I’m trying to make happen? If they give me an opportunity, what am I going to recommend?” Focus and flexibility Writing down your pre-call objective in case the focus of your efforts. Focus enables salespeople move their customers in the direction of predetermined goal. Knowing where you are going definitely increases the likelihood of getting there. Obviously if the pre-call objective turns out to be inappropriate as the sales call develops, it’s easy to switch tactics. Often such changes involve a simple redirection.   Making goals specific When asked the purpose of a call, some salespeople say enthusiastically, “it’s to get an order. Let go!”  Of course, everyone’s in favor of getting orders, but that is more likely to happen if the salespersons stop and ask themselves questions such as: what need of this prospect can I serve? Which product or service is best for this account? The more specific the objective the better. Moving towards your objectives Sometimes a sales call has limited objective. Guiding the customer in the direction of that preplanned outcome is what experienced salespeople do on most sales calls. Set objectives for every call Don’t let anyone tell you that selling is repetitive that the next step becomes a matter of rote (learning by repeating). Set SMART call objective Specific – to get an order is not specific Measurable – quantifiable (size, number etc) Achievable – not too difficult to fulfill    Timed – at this call or before end of the financial year.  

 Prospecting is the searching for and calling upon customers who have not previously purchased from the company. This activity is not of uniform importance across all the branches of selling. It is obviously far more important in industrial selling than retail selling. Concept of prospecting Prospecting begins the process of converting prospects into repeat customers. A suspect or lead is a potential prospect, i.e. a person or an organization that might have a need for a salesperson’s product or services. If a salesperson determines the suspect has a real need for the product, then that person or organization becomes a prospect. The next step is for the salesperson to qualify the prospect to find out if that person has both the ability and authority to make a purchase. Once a qualified prospect is located process begins. Prospecting strategies The following are some of the prospecting strategies commonly used: Direct mail marketing – Have a direct mail marketing, planning and tracking system, keeping in mind parameters such as age, income, occupation location and so on. Decide the frequency and number of mailers to be sent and the enclosures therein. Remember to follow-up. Trade shows – Professionals who effectively work trade shows, keep the following in mind:- they define very clear goals, as to what they want to accomplish through shows. The ultimate aim here is to translate presentations into sales. Customer referrals (endless chain) – this is a very effective method to for finding customers. Customers and customers are the best sources of future sales, with repeat sales from customers being better. You ask customers whether they know any other individuals or organizations who may be interested in finding out about your product or service. If the customer hesitates on communicating with other individuals about your product ask for names and promise to call them and ask them to give brief description of what you do. Orphaned customer – these are the customers left by the salespeople. These are great prospects. As a salesperson you should quickly contact such customers to begin developing relationships. Sales lead club – organize a group of salespeople in related but non-competitive fields to meet twice a month to share leads and prospecting tips. Observation Networking Center of influence Cold canvassing. The prospect pool The referrals come from prospects and customers. Different sources of prospects form prospect pool.  The prospect pool is a group of names gathered from various sources. Your source, for example may be mailing list, telephone book, referrals, orphans or existing customers. A prospect pool is usually created from the main sources such as: Leads – people or organizations you know nothing or very little about. Referrals – you frequently know very little about these people or organizations other than what you learned from the referrals. Orphans – company records provide your only information about these past customers. Your customers – the most important prospects for future sales                            Components of the prospect pool                                               The referral cycles Obtaining referrals is a continuous process without beginning or end. The salesperson is always looking for the right opportunity to find a referral. The referral cycle provides guidelines for a salesperson to ask for referrals in four commonly faced situations experienced by salespeople as shown below. The referral cycle      If you have a sales presentation at 10:00 am you can begin the referral cycle in the presentation phase. If you are delivering a product to a client you can start the cycle in the product delivery phase. If you are planning on making telephone calls to leads, referrals, orphans, or customers you can begin pre-approach phase. Referral cycle can begin at any point.   The parallel referral sales Salespeople must sell the product, plus sell the prospect on providing referrals. Equal emphasis must be given to both product sales and referral sales. You must nurture a parallel referral sale from the time of the initial contact, such as when making appointment. The referral sale should receive equal importance, effort and emphasis as the product sale. This is the key to referral cycles.

SALES CHANNELS ANALYSIS Channels Analysis provides a comprehensive view of the key issues affecting the sales, marketing and distribution of technology products and helps channel managers develop strategies that deliver business results. A channel analysis is an evaluation of how and where a product should be sold. It starts with an assessment of the options for getting a specific product or service into the hands of the end user. This typically happens in one of three ways. Selling directly to consumers. Selling to a retailer or wholesaler (middleman). Some combination of both. Selling directly to consumers allows an organization to maintain control over how the product is sold, including the final price charged to the customer, how it is displayed, and how it is promoted at the point-of-sale. However, selling directly can be more complex and expensive, as it often requires the organization to maintain a large sales team and a mechanism for distributing products and services all the way to the end user. Selling through the retail channel may reduce these complexities and costs, but the organization loses some control over the process and lacks the important direct touch with the customer that can often provide invaluable feedback and two-way communication. Understanding these factors is an important component of the channel analysis that all organizations should perform. It is possible for a small organization to perform this step in the research process in a cost-effective way. First, review secondary information from research reports, local business organizations, or other publications to get a better idea of what distribution channels look like in the market. Ask questions such as: Where are the majority of products sold? (Retail shops, informal markets, pharmacies, etc.) Is there a major distributor servicing these outlets? What are the challenges to distribution (for both retail and direct sales)? Are there good roads? Affordable places to warehouse products? Understanding these factors will help an organization decide where to focus its attention on more primary forms of channel analysis, such as: Visiting distributors to see what they charge for transportation or what wholesale price they are willing to pay for your product or service. Talking to retailers to understand their willingness to carry your (or competitors’) products and what price they feel they need to charge. Observing the distribution methods of competitors to your product. (Are they selling door-to-door? Through retail? Are they offering credit to their customers?) Performing this research can be a valuable tool to an organization offering a new product or service or even seeking to improve their ability to succeed with an existing offering. As a small organization, budget may constrain you from doing this in a highly sophisticated or detailed way, but many have followed the simplest version of the steps outlined here to dramatically understand the market for their product. If you have the time and resources to talk to stakeholders in the distribution channel, primary surveys can be a great way to capture this information. Here are examples of surveys that have been used to collect channel information relating to sanitation products from suppliers, financing organizations, and key opinion leaders. Methods and tools of sales environment analysis When you run a business, making the most of it becomes the prime purpose of life. Both big and small business owners need to conduct various analyses. There are many methods, which help to conclude about the firm’s current state before taking an informed decision. SWOT analysis is perhaps the most commonly used technique. STEEP, STEEPLE, and PEST are also used by individuals and companies. SWOT analysis often talks of the basics of business. People see it as so important because the method evaluates a project or business venture’s strengths, weaknesses, opportunities, and threats. The initials of these factors make up the acronym SWOT. Business owners or project managers apply this structured planning method to know where their venture stands. The analysis’ benefit is not limited to companies or industries only. You can carry out SWOT for products, places, and even people too. Both new and existing businesses can use it. The process involves stating the business goal. The aim of SWOT is to identify the favorable and unfavorable internal and external factors to reach the goal. You can call the degree to which a firm’s internal environment matches with its external environment as strategic fit. Strengths: Assess the characteristics of your business that give it an advantage over the others in this step. Questions like the following are often asked when considering Strengths: What does your business do better than others? What advantages does it have? What lowest-cost or unique resources do you have which others do not? What does the market think your strengths are? What factors help you sell products? What is your Unique Selling Proposition?   Weaknesses: These are characteristics that place the business at a disadvantage when compared to others. Answer the following questions: What could your business improve? What should the firm avoid? What does the market think your weaknesses are? What factors could lose you sales? Opportunities: In this part, consider elements that the project could profit from. The 2 most important questions to ask in this section are: What good opportunities can you think of? What are some interesting trends in the market? Threats: Find out what elements in the environment could cause trouble for your business or project. Some of the questions you can ask here are: What are the obstacles? What are the competitors doing? Are the quality standards or specifications for your products, services or job changing? Is technological advancement threatening firm’s position? Do you have cash-flow problems or bad debt? Could your weaknesses threaten your business seriously? There are other tools used to find out an organization’s current status and position. PEST, STEEP, and STEEPLE analysis help assess the company’s external environment and current role. All have the same goal and you can perform them, in the same way. You can use them for future planning and strategic management. Which one of them you will choose depends on

INDUSTRIAL/COMMERCIAL/PUBLIC AUTHORITY SELLING These categories are grouped together as the sales approach is similar and behavioral patterns exhibited by each conform to organizational behavior. A number of characteristics in these types of market distinguish them from consumer markets. Fewer customers Institutions and businesses purchase goods either for use in their own organizations or for use in the manufacture of other goods. There are few potential purchasers, each making high-value purchases. Concentrated markets Industrial markets are often highly concentrated, an example being the UK textile industry which is centered in Lancashire and Yorkshire. An industrial salesperson who sells into one industry may deal with only a few customers in a restricted geographical area. Complex purchasing decisions Buying decisions often involve a large number of people, particularly in the case of a public authority where a purchasing committee may be involved in a major purchase. Many industrial buying decisions involve more than the buyer; in some cases the technical specifier, production personnel and finance personnel are involved and this is where the decision-making unit can be seen in practice. This can prolong negotiation and decision-making processes. Salespeople have to work and communicate with people in a variety of positions and tailor their selling approaches to satisfy individual needs. For example, specifiers need to be convinced of the technical merits of the product, production people want to be assured of guaranteed delivery and buyers will be looking for value for money. For technically complicated products, selling is sometimes performed by a sale team, with each member working with their opposite number in the buying team, e.g. a sales engineer works with engineers in the buying company. Long-term relationships A life insurance policy salesperson might make a sale and never meet the customer again. The nature of selling in industrial, commercial and public authority settings is that long-term relationships are established and both parties become dependent upon each other, one for reliable supplies and the other for regular custom. There is a tendency to build up strong personal relationships over a long time and high pressure sales techniques could be counter-productive. A more considered approach involving salespeople identifying needs of individual customers and selling the benefits of the product to satisfy those needs are more likely to be successful. The ability of salespeople to deal with complaints and provide a reliable after-sale service is important. It is suggested that the effective salesperson must understand how to develop and sustain relationships with key customer groups, along the lines of relationship selling. Reciprocal trading This is an arrangement whereby company A purchases certain commodities manufactured by company B and vice versa. Such arrangements tend to be made at senior management level and are often entered into when there is a financial link between the companies, such as those within the same group (referred to as intergroup trading) or between companies whose directors simply want to formalize an arrangement to purchase as much of each other’s products as possible. Such arrangements can be frustrating for salespeople and buyers alike, as they deter free competition. Buyers do not like to be told where they must purchase from, just as salespeople do not like having a large part of a potential market permanently excluded because of a reciprocal trading arrangement.

FINANCIAL SYSTEMS-Money Market Instruments Money Market Instruments T hey are short-term dated securities. Because of their short terms to maturity, they undergo the least price fluctuations and are therefore the least risky instruments. The following are examples of money market instruments; 1.Treasury Bills: i. These are shot-term debt instruments issued by the government ii. They are issued in 3,-6,- and 12-month maturities to finance government activities iii. They pay a set amount at maturity and have no interest payments iv. Interest is covered by the fact that they are initially sold at a discount, that is, an amount lower than the amount they are redeemed at on maturity v. They are the most liquid of all the money market securities because they are the most actively traded vi. Interest rates on T-bills are usually the anchor for all other money market interest rates vii. They re also the safest among the money market instruments because the chances of default are minimal (the government can always raise taxes or issue currency to pay off its debts) viii. T-bills are popular due to their zero default risk, ready marketability, and high liquidity. Types of Treasury Bills There are several types of bills that are issued by governments: Regular- series bills: – i. These are issued routinely every week or month in competitive auctions ii. They have original maturities of three months, six months and one year. iii. New three and six month bills are auctioned weekly,; one year bills are normally sold once each month Irregular- series bills i. These are issued only when the Treasury has a special cash need ii. They can be strip bills or cash management bills iii. Strip bills- these comprise of a package offering of bills requiring investors to bid for an entire series of different bill maturities. iv. Investors who bid successively must accept bills at their bid price each week for several weeks running Cash Management bills i. Consist simply of reopened issues of bills that were sold in prior weeks ii. The reopening of a bill issue normally occurs when there is an unusual or unexpected Treasury need for cash. How Treasury Bills are sold i. T-bills are sold using the auction method. ii. A new regular bill is announced weekly by the Treasury on Tuesday each week, with bids from investors being due the following Monday by 1pm. iii. Interested investors fill out a form tendering an offer to the Treasury for a specific bill issue at a specific price. iv. The bid forms are usually submitted through commercial banks or it can be taken to Central bank v. The Treasury entertains both competitive and non-competitive tenders for bills vi. Competitive tenders are typically submitted by large investors such as banks and security dealers who several million shillings worth at one time. vii. Non-competitive tenders usually come from small investors who agree to accept the average price set in the weekly or monthly bill auction viii. Non competitive bidders must pay the full par –value price of the bill at the time the tender is made and on the issue date receives the refund representing the difference between the amount paid in by the investor and the actual auction price. ix. Generally, the Treasury fills all non-competitive tenders for bills. x. For the competitive bills, the highest bidder receives bills and those who bid lower also receive theirs until all available securities have been allocated. xi. The lowest price at which at least some bills are awarded is called the stop-out price. 2.Negotiable Bank Certificates of Deposit: A certificate of deposit (CD) is i. a debt instrument sold by a bank to depositors ii. it pays annual interest of a given amount and at maturity pays back the original purchase price iii. The interest rate on a large CD is set by negotiation between the issuing institution and its customer and it generally reflects the prevailing market conditions. iv. Negotiable CDs may be registered on the books of the issuing depository institution or issued in bearer form to the purchasing investor. v. Bearer CDs are easier to trade on secondary markets vi. Interest rates in the CD market are computed as a yield to maturity but are quoted on a 360 day basis, except in the secondary trading market where the bank discount rate is used as a measure of CD yields.

SALES ENVIRONMENT ANALYSIS In this chapter we analyze the major forces that affect selling and sales management. We then consider specific sales settings such as sales channels, industrial/ commercial/public authority, retail and services selling. Related activities that support selling activities, namely sales promotions, exhibitions and public relations, are also examined.   ENVIRONMENTAL AND MANAGERIAL FORCES THAT IMPACT ON SALES A number of major environmental (behavioral and technological) and managerial forces impact on how selling and sales management are and will be carried out.   Behavioral forces As customers adjust to a changing environment, so sales have to adapt to a variety of influences: (a) Rising consumer and organizational buyer expectations; (b) Customer avoidance of buyer–seller negotiations; (c) Expanding power of major buyers; (d) Globalization of markets; (e) Fragmentation of markets.   Rising consumer/organizational buyer expectations and fulfillment of higher order needs As consumers experience higher standards of product quality and service, so their expectations are fuelled to expect even higher levels in the future. This process may be hastened by experiences abroad and new entrants to industries (possibly from abroad) that set new standards of excellence. Technological advances have created new higher customer expectations. The existence of the internet means that customers expect salespeople calling on them for the first time (and after) to be familiar with their firms, its products and personnel   Customer avoidance of buyer–seller negotiations Studies have shown that the purchase of a car is the most anxiety-provoking and least satisfying experience in retail buying.  Some car salespeople are trained in the art of negotiation supported by high pressure sales tactics. Consequently, customers have taken to viewing the purchase as an ordeal to be tolerated rather than a pleasurable occasion to be savored.   Expanding power of major buyers The growing dominance of major players in many sectors (notably retailing) is having a profound influence on selling and sales management. Their enormous purchasing power means that they are able to demand and get special services, including special customer status (key account management), just-in-time inventory control, category management and joint funding of promotions.   Globalization of markets As domestic markets saturate, companies are expanding abroad to achieve sales and profit growth. The global challenge includes a correct balance between expatriate and host country sales personnel, adapting to different cultures, lifestyles and languages, competing against world-class brands and building global relationships with customers based in many countries. As companies expand into new overseas markets, there is a need to understand different cultural expectations and to give thought to various cultural issues. Ethical differences are also important what is ethical in one country may be unethical in another.    Fragmentation of markets Driven by differences in income levels, lifestyles, personalities, experiences and race, markets are fragmenting to form market segments. This means that markets are likely to become smaller with an increasing range of brands marketed to cater for the diverse needs (both functional and psychological) of customers. Marketing and sales managers need to be adept at identifying changes in consumer tastes and developing strategies that satisfy an increasingly varied and multicultural society.   Technological forces Three major forces are at play: Sales force automation; Virtual sales offices; Electronic sales channels. Sales force automation includes laptop and palmtop computers, mobile telephones, fax, email and more advanced sales software which aid such tasks as journey and account planning, and recruitment, selection and evaluation of sales personnel. In addition, electronic data interchange (EDI) provides computer links between manufacturers and resellers (retailers, wholesalers and distributors), allowing direct exchange of information. Improved technology has encouraged the creation of virtual offices, allowing sales personnel to keep in contact with head office, customers and co-workers. The virtual office can be home or even a car. This means cost and time savings and enhanced job satisfaction for salespeople who are spared time waiting in traffic that is a feature of the job. The fastest growing electronic sales channel is undoubtedly the internet.  Its impact is not simply to reduce the size of sales forces but also to change the focus of the sales team. The internet has also raised customer expectations regarding salesperson knowledge about their company and responsiveness. Managerial forces Managers can respond to the changes in the environment by developing new strategies and tactics to enhance sales effectiveness, including: (a) Employing direct marketing techniques; (b) Improving co-operation between sales and marketing; (c) Encouraging salespeople to attend training programmes and acquire professional qualifications. Sales channels Distribution channels involve two separate, yet closely connected, activities: logistics, or physical distribution management (PDM), and channels of distribution. Logistics or physical distribution management (PDM) The terms logistics and PDM are interchangeable, although some writers infer that logistics is more concerned with strategic issues whereas PDM relates to tactics. Basically, logistics means the effective and economic planning, implementation and control of the physical flow of materials in their unprocessed state through to finished goods from the point of origin to delivery to the end-consumer.   Channels of distribution Management should constantly reappraise channels of distribution to make cost savings. Marketing channels are determined by company policy and this determines how the sales force should be organized. A sales channel is the route that goods take through the selling process from supplier to customer. Sometimes the channel is direct, especially where goods sold are incorporated into a manufacturing process. Final goods might then be sold through a different channel. Selecting/reappraising sales channels When selecting or reappraising channels, the company must take into consideration: The market; channel costs; The product; Profit potential; channel structure; Product life-cycle; and Non-marketing factors.   The market This must be analyzed to ensure that as many potential consumers as possible will have an opportunity to purchase the product or service. Channel compatibility with similar products in the marketplace is important. Consumers tend to be conservative and any move from the accepted norm can be viewed with suspicion. Unless there are sound reasons for so doing, it does not make sense to go outside the established channel.

FINANCIAL SYSTEMS-FINANCIAL INSTRUMENTS A financial instrument is defined as, a claim against the income or wealth of a business firm, house hold or unit of government, normally represented by a certificate, receipt or other legal document, and which is usually created by the lending of money. Financial Assets are by therefore nature intangible assets e.g i. Treasury Bills ii. Bonds iii. Shares Role of financial assets 1. Transfer funds from surplus units to deficit units to invest in intangible assets. 2. Transfer funds in such a way as to redistribute the unavoidable risk associated with the cash flow generated by tangible assets among those seeking and those providing the funds. Properties of financial assets These properties influence the attractiveness to investors: i. MONEYNESS : Some financial assets are used as a medium of exchange- these assets are called money. Other assets are near money/quasi-money for example Treasury bills. Therefore moneyness is a desirable property for investors. ii. DIVISIBILITY & DENOMINATION : Divisibility relates to the minimum size at which a financial asset can be liquidated and exchanged for money. The smaller the size the more the financial asset is divisible. iii. REVERSIBILITY : Also known as round-trip cost refers to the cost of investing in a financial asset and then getting out of it and back into cash again e.g Bank deposit. A low round-trip cost is clearly a desirable property of a financial asset, and as a result thickness is a valuable property. Thickness of the market is essentially the prevailing rate at which buying and selling orders reach the market maker. A thin market is one which has few trades on a regular and continuing basis. iv. TERM TO MATURITY : The term to maturity is the length of interval until the date when the instrument is scheduled to make its final payment or the owner is entitled to demand liquidation. However, it should be recognized that even a financial asset with a stated maturity, may terminate before its stated maturity. This may occur for several reasons including bankruptcy or because of provisions entitling the debtor to repay in advance or the investor may have the privilege of asking for early repayment. v. LIQUIDITY: Liquidity is determined by contractual arrangements. Deposits at a bank are perfectly liquid because the bank has a contractual obligation to convert them at par on demand. However, financial contracts representing a claim on private pension fund may be regarded as totally illiquid because these can be cashed only on retirement. Liquidity may depend not only on the financial asset but also on the quantity one wishes to sell or buy. A small quantity may be quite liquid while one may run into illiquidity problems with large lots. vi. CONVERTIBILITY : Some financial assets are convertible into other financial assets. In some cases, the conversion takes place within one class of financial assets, as when a bond is converted into another bond. In some cases the conversion spans classes e.g a Corporate convertible bond may be changed into equity. Normally the timing, costs and conditions are clearly spelled out in the legal descriptions of the convertible security at the time it is issued.

What is sales planning? Planning is done at various stages of the sales lifecycle around the fiscal year. All business corporations set monthly or quarterly sales targets and to achieve this, a lot of planning and execution is required. A set of steps and strategies are designed to achieve these targets and this is called Sales Planning. In other words, Sales planning is a skill where the following steps are generally followed: Current situation of the company is evaluated Knowing what is your present position is predominant for making plans for the future. The market conditions are studied The market is ever-changing. So orienting your sales plan accordingly is required. New revised targets are defined Short term planning is necessary for this step and most companies miss this. Strategies required to achieve the targets are determined When new targets are set, making changes to the task plan subsequently needed. Finally, resource allocation for the same is done. Issuing the required time, money, people for the new target accomplishment is to be undertaken.   Why is Sales Planning required? Sales Planning is a key function in the procedure of sales management process. Sales planning is an effective method that involves sales forecasting, demand management, setting profit-based sales targets, and the written execution steps of a sales plan. Sales Planning is the process of organizing activities that are mandatory to achieve business goals. A sales plan contains a strategic document that figures out your business targets and several resources. These can be used for some activities which you perform to reach your desired goal. Sales Planning involves two steps, i.e. formation and maintenance of a particular plan, in which a salesperson is expected to use his conceptual skills to meet his objective. As such, planning is an elementary quality of intelligent behaviour. Before launching a new product in the market and proceeding with the set of activities, which generally follow the launch of a product, we have to create a strategic plan for that. Sales Planning is an essential element in the management process. Various Sales Plan techniques are often used in several organizations according to their requirements, whether they need to plan quarterly, half yearly or annually. If your sales staff is good, then you would not need to do research from the beginning to get more sales in the market.   The Nature and Importance of Sales Planning Planning means deciding what to do in the future. It involves setting Objectives and determining ways to achieve them. Sales planning involves anticipating environmental developments and preparing to meet these developments or capitalize on them. Environmental forces can act as threat or opportunity for a company’s sales n marketing activities. Sales planning is important to every member of sales organization. It provides the direction n framework for sales activities. It helps sales personnel understand where the organization is headed, how is it expected to go there, and what specific actions are to be taken, by whom and when.   The importance of sales planning Better implementation of corporate plans Provide a sense of direction Focus on realistic objectives Improve coordination Facilitate control Ensure healthy interpersonal relationships Reduce uncertainty and risk   The sales planning process Setting objectives Internal situation analysis External environment audit Determining operations to meet objectives Build, Hold, Harvest, Divest Organizing for action Implementing Developing strategies Coaching Measuring results against standards Revaluating & control   Scope A thorough sales and marketing strategy can include plans for messaging, building brand awareness and advertising tactics. The plan should define the frequency and length of time the company will utilize the various advertising channels and platforms available. Depending on demographics, one consumer group may respond better to a specific advertising platform, such as social media advertising, and others may prefer traditional advertising messages. The plan helps the marketing team target the specific consumer groups with the advertising methods those consumers prefer. Sales and marketing plans should provide qualitative and quantitative methods by which a business can measure success of the marketing campaigns.   Characteristics of effective sales planning A good sales plan establishes goals, priorities, timetables, and necessary resources. A sales plan that will achieve your ends has these characteristics: Sets measurable, specific, vivid, and motivating goals. Where do you intend to be in one year? What measures will you use to gauge your achievements: Number of buyers contacted? Percentage of sales to certain types of customers? Sales volume? Profit? Ranking among your peers? Identifies the enabling objectives necessary to achieve ultimate goals. What objectives must you reach on the way to the intended outcome? What new work habits must you develop? What values will you need to embrace? Outlines a logical order among the intermediate steps. What is the logical sequence for achieving your ultimate goal? What must happen first, second, third, and so on? Establishes a reasonable yet challenging time line. When will you achieve your ultimate goal? When will you jump the intermediate hurdles? Pinpoints the barriers between you and your objectives. Why haven’t you been achieving your objectives? What are the constraining forces, either in you or in the environment? What has stood in the way? Specifies strategies, procedures, and tactics. What actions will overcome the barriers that have kept you from achieving your objectives? Summarizes the resources needed. What money, materials, supplies, equipment, facilities, information, education, training, support, counsel, or staffing do you require? Establishes accountability. What will you do to hold your feet to the fire? Is in writing. Plans not written are dreams. Plans written become vows. Don’t just dream about success, vow to succeed. Is shared and negotiated with those responsible for implementing it. The more people who see your plan, the more pressure you’ll feel to make it happen. Signifies commitment. Start your plan only once you become totally confident in it and fully committed to it.   Sales planning process 1) Setting Sales Process objectives Your sales planning is going to start only when you have defined the objectives for the sales team. For example – The objective of an air conditioning company might

INTRODUCTION TO FINANCIAL SYSTEMS The Financial System A financial system no matter how rudimentary is a complex system. It is complex in its operation such that neither the system itself nor its operation can be measured accurately. Because of this complexity a simple definition cannot adequately capture what a financial system is. A financial system comprises financial institutions, financial markets, financial instruments, rules, conventions, and norms that facilitate the flow of funds and other financial services within and outside the national economy. The financial system can be described as a whole system of all institutions, individuals, markets and regulatory authorities that exist and interact in a given economy. The institutions, government and individuals form the participants in various markets; money markets (including foreign exchange) and capital markets (including security) markets. The participant buy (borrow) and sell (lend) money to different parties at a price (interest or dividend) within the market, which is determined by the forces of demand and supply. In a broader aspect a financial system can also be defined as a system that allows the transfer of money between savers (and investors) and borrowers operating on a global, regional or firm specific level. According to Gurusam, it is a set of complex and closely interconnected financial institutions, markets, instruments, services, practices, and transactions. Financial systems are crucial to the allocation of resources in a modern economy. They channel household sav ings to the corporate sector and allocate investment funds among firms; they allow inter-temporal smoothing of consumption by households and expenditures by firms; and they enable households and firms to share risks. Since these functions take place in a market oriented environment, there is a need for an independent party to enforce rules and contracts and this is the regulator. The main regulatory authorities of the financial institutions that constitute the financial system of a given economy are the Central Bank and Capital Market Authority. THE ROLE OF FINANCIAL SYSTEM IN THE ECONOMY The financial sector provides six major functions that are crucial for the survival and efficient operation of any given economy. These functions are outlined below: 1. Providing payment services. It is inconvenient, inefficient, and risky to carry around enough cash to pay for purchased goods and services. Financial institutions provide an efficient alternative. The most obvious examples are personal and commercial checking and check-clearing and credit and debit card services; each are growing in importance, in the modern sectors at least, of even low-income countries. 2. Matching savers and investors. Although many people save, such as for retirement, and many have investment projects, such as building a factory or expanding the inventory carried by a family micro enterprise, it would be only by the wildest of coincidences that each investor saved exactly as much as needed to finance a given project. Therefore, it is important that savers and investors somehow meet and agree on terms for loans or other forms of finance. This can occur without financial institutions; even in highly developed markets, many new entrepreneurs obtain a significant fraction of their initial funds from family and friends. However, the presence of banks, and later venture capitalists or stock markets, can greatly facilitate matching in an efficient manner. Small savers simply deposit their savings and let the bank decide where to invest them. 3. Generating and distributing information. One of the most important functions of the financial system is to generate and distribute information. Stock and bond prices in the daily newspapers of developing countries are a familiar example; these prices represent the average judgment of thousands, if not millions, of investors, based on the information they have available about these and all other investments. Banks also collect information about the firms that borrow from them; the resulting information is one of the most important components of the capital of a bank although it is often unrecognized as such. In these regards, it has been said that financial markets represent the brain of the economic system. 4. Allocating credit efficiently . Channeling investment funds to uses yielding the highest rate of return allows increases in specialization and the division of labor, which have been recognized since the time of Adam Smith as a key to the wealth of nations. 5. Pricing, pooling, and trading risks Insurance markets provide protection against risk, but so does the diversification possible in stock markets or in banks’ loan syndications. 6. Increasing asset liquidity. Some investments are very long-lived; in some cases – a hydroelectric plant, for example – such investments may last a century or more. Sooner or later, investors in such plants are likely to want to sell them. In some cases, it can be quite difficult to find a buyer at the time one wishes to sell – at retirement, for instance. Financial development increases liquidity by making it easier to sell, for example, on the stock market or to a syndicate of banks or insurance companies. 7. Financial systems and economic growth: Both technological and financial innovations have driven modern economic growth. Both were necessary conditions for the Industrial Revolution as steam and water power required large investments facilitated by innovations in banking, finance, and insurance. Both are necessary for developing countries as they continue their struggle for economic development. But the effective functioning of the financial system requires, in turn, the precondition of macroeconomic stability. The Five Parts of the Financial System 1.Money : A Good which is used as a means of payment for exchanging goods. This has not always been the case, we once used gold and silver coins as a means of paper. 2. Financial Instruments : A written legal obligations of one party to transfer something of value to another party at some future date under certain conditions. These obligations usually transfer resources from savers to investors. Examples: Stocks, bonds, insurance policies. 3. Financial Markets : Markets where financial instruments are traded. Examples: New York Stock Exchange, Chicago Board of Trade and Nairobi Stock exchange. 4. Financial Institutions : These entities

                                           SALES FORECASTING A company can forecast sales either by forecasting market sales (called market forecasting) and then determining what share of this will accrue to the company or by forecasting the company’s sales directly. The point is that planners are only interested in forecasts when the forecast comes down to individual products in the company.   We now examine the applicability and usefulness of the short-, medium- and long-term forecasts in so far as company planners are concerned and look at each from individual company departmental viewpoints. Short-term forecasts. These are usually for periods up to three months ahead and are really of use for tactical matters such as production planning. The general trend of sales is less important here than short-term fluctuations. Medium-term forecasts. They are of most importance in the area of business budgeting, the starting point for which is the sales forecast. Thus, if the sales forecast is incorrect, then the entire budget is incorrect. Forecasting is the responsibility of the sales manager. Such medium-term forecasts are normally for one year ahead. Long-term forecasts. These are usually for periods of three years and upwards depending on the type of industry being considered. In industries such as computers three years is considered long-term, whereas for steel manufacture ten years is a typical long-term horizon. They are worked out from macro-environmental factors such as government policy, economic trends, etc. Such forecasts are needed mainly by financial accountants for long-term resource implications and are generally the concern of boards of directors. Forecasting techniques They are classified into two, namely: Qualitative techniques Quantitative techniques   Qualitative techniques  Qualitative forecasting techniques are sometimes referred to as judgmental or subjective techniques because they rely more on opinion and less on mathematics in their formulation. They are often used in conjunction with the quantitative techniques. These techniques includes: Forecast by analogy Delphi method Technology forecasting Statistical surveys Scenario building composite forecasts   Consumer/user survey method This method involves asking customers about their likely purchases for the forecast period, sometimes referred to as the market research method. For industrial products, where there are fewer customers, such research is often carried out by the sales force on a face-to-face basis. The only problem is that then you have to ascertain what proportion of their likely purchases will accrue to your company. Another problem is that customers (and salespeople) tend to be optimistic when making predictions for the future. Both of these problems can lead to the possibility of multiplied inaccuracies. This method is of most value when there are a small number of users who are prepared to state their intentions with a reasonable degree of accuracy. It tends, therefore, to be limited to organizational buying. It is also a useful vehicle for collecting information of a technological nature which can be fed to one’s own research and development function. Panels of executive opinion This is sometimes called the jury methods, where specialists or experts are consulted who have knowledge of the industry being examined. Such people can come from inside the company and include marketing or financial personnel or, indeed, people who have a detailed knowledge of the industry. More often, the experts will come from outside the company and can include management consultants who operate within the particular industry. Sometimes external people can include customers who are in a position to advise from a buying company’s viewpoint. The panel thus normally comprises a mixture of internal and external personnel. Sales force composite This method involves each salesperson making a product-by-product forecast for their particular sales territory. Thus individual forecasts are built up to produce a company forecast; this is sometimes termed a ‘grass-roots’ approach. Each salesperson’s forecast must be agreed with the manager and divisional manager where appropriate, and eventually the sales manager agrees the final composite forecast. Such a method is a bottom-up approach. Where remuneration is linked to projected sales (through quotas or targets) there can be less cause for complaint because the forecast upon which remuneration is based has been produced by the sales force itself. -Delphi method -Product testing and test marketing Quantitative techniques Quantitative forecasting techniques are sometimes termed objective or mathematical techniques as they rely more upon mathematics and less upon judgment in their computation. These techniques are now very popular as a result of sophisticated computer packages, some being tailor-made for the company needing the forecast. Quantitative techniques can be divided into two types: Time series analysis. The only variable that the forecaster considers is time. These techniques are relatively simple to apply, but the danger is that too much emphasis might be placed upon past events to predict the future. The techniques are useful in predicting sales in markets that are relatively stable and not susceptible to sudden irrational changes in demand. In other words, it is not possible to predict downturns or upturns in the market, unless the forecaster deliberately manipulates the forecast to incorporate such a downturn or upturn. Causal techniques. It is assumed that there is a relationship between the measurable independent variable and the forecasted dependent variable. The forecast is produced by putting the value of the independent variable into the calculation. One must choose a suitable independent variable and the period of the forecast to be produced must be considered carefully. The techniques are thus concerned with cause and effect. The problem arises when one attempts to establish reasons behind these causes and effect relationships; in many cases there is no logical explanation. Indeed, there is quite often nothing to suppose that the relationship should hold good in the future.   Levels of forecasting Forecasts can be produced for different horizons starting at an international level and ranging down to national levels, by industry and then by company levels until we reach individual product-by-product forecasts. The forecast is then broken down seasonally over the time span of the forecasting period and geographically right down to individual salesperson areas. These latter levels are of specific interest to sales management, for