Sales are basically activities connected to the volume of products sold in a given planned time frame. The sale of a product to an end user, the collection of payments from a client and the delivery of a purchased service to a customer are all considered sales. There are three basic functional areas in any sales organization. They are:
Retail Sales: In retail sales, the products sold are usually those bought directly from a store. The transaction involves an agreement between the seller and buyer. In a retail transaction, there usually exists a direct transaction and there is no intermediary or third party. In order to determine the gross sales, net sales have to be subtracted from gross sales to get the net transaction.
Marketing Sales: In marketing sales, the product is marketed directly to the target audience. This has a two-way transaction – the product goes through the hands of the seller and the buyer, and then it goes back to the marketing department. The marketing sales team collects data on the purchases, passes the data on to the company and the seller, and keeps track of all the sales. It is usually the job of this sales department to market the product to the target customers. Data on all the sales and how well the product is performing is then used to optimize future marketing strategies.
Engineering and Development Sales: These are activities involved in the supply chain processes for products. In engineering and development, processes like cost analysis, feasibility study, manufacturing costing estimation, production scheduling, etc., are carried out. In marketing, these activities involve the creation of advertisements, packaging and labelling of the product. The creation of market campaigns and selling the product are also part of the selling process.
All the three types of sales processes are different. Salaries in salable services are subject to the overall performance of the sales staff. This means that a company may have great sales people but bad marketing and management systems. Poor performance can result in unprofitable short term sales. On the other hand, good performance may result in a company earning profits year after year.
A company needs to have a system in place for tracking its sales as well as its marketing and management effectiveness. This tracking should include the complete list of all the channels through which the product or service is being sold. Sales and marketing departments should be linked in such a way that the senior manager is informed of the status of each departmental sales representative on a regular basis. This would give them an opportunity to review the performance of the sales representatives and the marketing and management systems of the company. This will give a clear picture of where the company is in terms of its sales and marketing processes