UNIT 5-SALES AND PERSONAL SELLING

THE KNOWLEDGE OF SALES STAFF

PRODUCT KNOWLDEGE

Product knowledge is an essential sales skill. Understanding your product’s or services’ features allows you to present their benefits accurately and persuasively. Customers respond to enthusiastic sales staff who are passionate about their products and eager to share the benefits with them.

Sales staff should have product knowledge in the following areas: Sizes: extra large, large, medium, small, extra small and sizes in numbers –e.g. 40 (6.5)

41 (7) Functions: how does the product/service works-e.g. fast processor, 124GB storage

medium, etc.; water tank stores 20,000 gallons of water, can last for 25years etc. Colours: blue, white, red, black, red, green, ash purple etc. Compatibility: this determines if the product is for fit the purpose for which the

manufacturer says it does- e.g. can the product process 250 items in 1 minute?, Can the water tank stores 20,0000 gallons of water? can the hair cream relax the hair as claimed by the seller?

Sources of product knowledge

Salespersons or people can obtain product or service knowledge form the following sources: Personal experience:-by using the product or service being sold personally Online forums- where salespersons exchange information with other professional on the

benefits or usages of product on-line Feedback from customers- Trade and industry publications- information about product or service is published by

respective manufacturers and copies of this information are made available to sales departments in organisations

Your team members- knowledge can be acquired about a product or service from your colleague with whom you work

Sales training programmes- organisations provide information about a product or service through programmes in house

Visits to manufacturers-

Sales motivation

Sales motivation is a combination of financial reward and benefits used by the sales management to incentivise salespersons to increase the sales volume of an organisation. There are various forms of such rewards but the most commonly used ones are as follows: Bonuses- it is a payment made to a salesperson depending on the

percentage of sales made in a given period (Alibaster Smith). And it is not a regular payment because it can given at any time the specific is achieved.

Advantages- (I) salespersons are motivated to sell more products or services if

compensation is generous (ii) a well designed bonus scheme pays salespersons well without affecting

the profit of an organisation (iii) it motivates exceptional performance among salespersons

Disadvantages of a bonus scheme

The following are some of disadvantages of a bonus scheme: Salespersons perform poorly if the percentage of bonus is low or not

fair Bonus scheme can create problems for an organisation if

salespersons think that they should be given bonus everything time A bonus scheme can be very expensive for the organisation there is

no growth in the business.

Discounts (rebates)

Discounts are reductions of regular price of a product or service in order to obtain an increase in sales volumes. These discounts are called “sales” or markdown, and are used in most organisation.The merits of discounts are:(i) It promotes short term increase in sales-(ii) Longer term profits-(iii) Brand loyalty- There are limitations too which are below:(i) can lead to price war with a competitor(ii) It can create false expectations among customers-therefore customers might not

spend(iii) Where the expectation is not met the organisation risks its image being tarnished.

BENEFITS

Benefits are tangible and non-tangible incentives given to motivate salespersons to increase the organisation’s productivity(sales volume). The tangible benefits are: Free new cell phone (galaxy 6edge) IPad air 2 Laptop computer A nice toy for a salesperson’s childThe non-tangible benefits are:(a) Free-paid two weeks holiday in Cancun (Mexico)(b) One week paid off (c) Free sales training for one week in Spain.(d) N.b. bear it in that such benefits are designed to motivate the salesperson to work harder

to increase sales; while at the same time it will increase the organisation’s profit margin.

Targets

The targets are objectives or aims of managerial action which is used to measure success or failure. In sales department, it is used as an incentive to promote the sales levels in order to maximise profits. Some examples are shown here: Sales target for April : 120,000 carton of ball pens to be sold- (each salesperson will be

given £50 voucher for lunch at Subway) Sales target for the quarter (first 4 months of the year): 2,000,000 cans of baked beans to

be sold(salespersons will receive £100 each in cash)Advantages of setting targets- (a) Encourages salespeople to sell more(b) (b) there is team-spirit and team work among salespeopleDisadvantages-(c) (i) some target are too high(d) Sometimes, external forces will derail the target for e.g. economic recession

Class exercise

Calculations on bonuses in percentages Formula = 1 X 200 divided by 5% (200/5= 40). Please work out the following bonuses given to the following

salespersons at 6%(a) Miss Spencer got 6% bonus for selling 2,400 oranges(b) Master Kevin got 6% bonus for selling 250 sweets(c) Ms Rita got 6% bonus for 1,000 pens(d) How much bonus did each of the above salesperson get?(e) Provide answers in 10minutes

Legislation affecting organisation’s selling policiesThere are legislations to protect the consumers 'rights against the sale of goods and provision of services , which are defective. Two of the legislations are: the Consumer Protection Act 1987 and the Consumer Protection Regulation 2014. Some of the areas protected under these legislations are: Price matching- consumers have the right to demand paying lower price for goods or services

displaying varying prices Discounting- consumers have the right to discount where goods or services have defects or

not fit for purpose; and yet the goods or services have been consumed. In this case, a consumer is entitled to the discounts depending on the price and the conditions below. where the price of the product or service is £5,000 or more, a discount of:

(i) 25% if the harm or inconvenience is more than minor (ii) 50% if it is significant (iii) 75% if it is severe (iv) 100% (full refund) if it is very serious

guarantees

Consumers have rights regardless of any warranty provided by the supplier or manufacture to the following guarantees: Fix the problem when goods or service fail to meet the required standard or defective Replace the defected parts of the product without extra cost to the consumer Refund the the full money paid to the customerIt is must be noted that since 1st January 2012, manufacturers have a duty to state in their guarantees the following items, as shown below: Terms of guarantee to be clearly stated, it must be in plain language and legible, It must contain the warrantor(supplier or manufacturer’s name, address, business

name, telephone number, location and email address This also includes free after sales services Failure to provide such details attracts a fine of $50,000 for corporate body and

$10,000 for individual

Customer care

Under the Consumers Regulation (2014), suppliers and manufacturers have a duty to ensure that services or products designed to be sold to prospective buyers, do not harm the health of consumers. So, it is important that the products or services are free from: Any harmful components or substances Any toxic materials Any pollutant and Any hazardous chemicals

Dealing with customer complaints and problemsUnder the Consumer Protection Act (1987) and Consumer Protection Regulations (2014), Suppliers and Manufacturers have a duty to solve problems and deals with customers’ problems respectively. To achieve this objectives, they must provide: Accurate information on products and services Avoid forcing goods or services on customers Desist from making repeated, harassing and harmful telephone calls to customers

and prospective customers Deal with customers’ complaints within reasonable period of time Accept responsibility for defected products or services Be responsible and ready to replace, refund and repair defected products in line with

their guarantees policies. And charge customers no extra cost for dealing with such complaints

The GIBBS’ Reflective cycle

This reflective cycle was invented by professor Graham Gibbs in 1988 at the university of Oxford. The Gibbs reflective cycle (Cycle) can be used in many ways by students to improve their learning as well as by professional, to improve their development in an organisation.Definition of reflection- it is a mental processing like a form of thinking that we use to fulfil a purpose or to achieve some anticipated outcome (Jenny Moon). Some of the functions of the Gibbs’ cycle are as follows: To challenge your assumptions (a thing accepted as true without proof) To explore different or new ideas and approaches towards doing or thinking about

things To promote self improvement( this involves identifying your strengths and

weaknesses and adopting measures to address them To link practice with theory- for example- using experience gained through sales

knowledge to solve customers’ problem

THE STAGES IN THE GIBBS’ CYCLE OF RELECTION

There are six stages in the Gibbs’ reflective cycle, the stages are below. The first stage is description

At this stage you just describe the events or experience you can describe your experience by stating specific and relevant

situations- For example – describe sales experience- where the experience took

place and what actually happened

The second stage of the cycle is feelingsAt this stage, you just describe your feelings and the following questions are asked: How did you feel and what did you feel? What and how did you feel during the experience ? How did you feel during the experience? What did you think and feel after the experience?

The third stage is Evaluation

During this stage, you make positive and negative judgements about the experience. For example: What went well during the experience (what worked) What went badly during the experience (what did not worked) How did the experience end? (complete or incomplete0

The fourth stage is analysis

At this stage, an attempt is made to explain the causes and consequences of things that happened by asking the following questions:What are the causes of action Why do you think the action or experience happened?

Consequences of action What do you think this action will lead to? How useful is your contribution to the experience? Explain why your contribution is useful? Try to assess the people’s reaction Are those people’s experience same or different ? What can be done to be prepared to face the experience in the future? What can be done to improve positive experience further in the future ? What are the priority areas that need to be improved? What specific plans can be used to achieve the improvements?

The fifth stage is Conclusion

At this stage, you state what you have learned about the experience by referring to specific details. For example, things that should or could have been done differently What prevented you from doing those things? What personal experience did you gain (good or bad)? What did you learn from your current knowledge (strength or

weakness) Did your experience meet any of your competencies or skills?

The sixth or final stage is known as the action planThis stage involves actions or measures which are taken to improve knowledge, ability and experience. The following are some actions plans: Training programme to increase knowledge, skill or ability to deal with

the experience in the future? Adopt new strategy to deal with the experience in the future? Use resources in a different way? or Move into area of experience? etc.

Home work

Please learn the Gibbs’ reflective cycle and write about its importance to professionals.

Each student will present their work for two minutes in the next class.

THANKS FOR LISTENING.