Sales and Retail Management (22MBAMM304)

MODULE-3

SALES FORCE MOTIVATION AND COMPENSATION

Sales force Motivation and Compensation: Nature of motivation, Importance, Process and factors
in the motivation, Compensation-Meaning, Types of compensation plans and evaluation of sales
force by performance and appraisal process. Sales management job: Standard sales management
process-International sales management -International market selection, market survey approach or
strategy.

INTRODUCTION

Sales force motivation and compensation are two closely intertwined concepts. Salespeople are typically
driven by a desire to earn money, so compensation plays a major role in motivating them to perform at their
best. However, other factors, such as recognition, career advancement opportunities, and a sense of purpose,
can also play a role in motivating salespeople.

NATURE OF SALES MOTIVATION

Sales motivation refers to the internal and external forces that drive salespeople to achieve their sales targets
and perform at their best. It is a multifaceted concept influenced by personal aspirations, external rewards,
workplace culture, and a sense of purpose.

1. Personal Goals

Salespeople often have personal aspirations that fuel their motivation. These goals can include financial
security, career advancement, or personal fulfillment.

Example : A young sales executive working at a real estate company might be motivated to close deals
because they want to buy their first home. Their personal goal of homeownership drives them to make more
sales and earn higher commissions.

Example:A senior sales professional at a pharmaceutical company might aim to become a regional sales
manager. Their motivation stems from the ambition to move up the corporate ladder, making them work
harder and seek mentorship opportunities.

2. External Rewards

Sales professionals often respond to tangible rewards such as commissions, bonuses, and incentives.
Companies use these rewards to boost sales performance and employee engagement.

Example:A car dealership offers a lucrative bonus for sales representatives who sell more than 15 cars in a
month. A salesperson, seeing the potential to earn an extra ₹50,000, pushes themselves to reach the target,
even by working extra hours.

Example:A software sales company introduces a "Salesperson of the Month" award, where the best
performer gets an all-expenses-paid vacation. This external recognition motivates employees to compete and
close more deals.

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 Sales and Retail Management (22MBAMM304)

3. Work Environment

A positive and supportive work environment significantly impacts sales motivation. Sales teams thrive in
workplaces where they feel appreciated, supported, and empowered with the right tools and training.

Example:A telecom company provides its sales team with regular training sessions, clear performance
feedback, and team-building activities. Sales employees feel valued and remain motivated to achieve their
targets.

Example:A startup selling digital marketing solutions ensures that managers provide continuous
encouragement, celebrate small wins, and maintain open communication. As a result, sales representatives
feel less pressure and perform better.

4. Sense of Purpose

Salespeople feel more motivated when they believe in the product or service they are selling and see a
meaningful impact in their work.

Example:A salesperson working for a solar energy company finds motivation in the fact that their sales help
reduce carbon emissions and promote renewable energy. Their passion for environmental conservation keeps
them driven.

Example:A medical device sales executive who supplies life-saving equipment to hospitals feels a deep
sense of purpose knowing their work directly contributes to saving lives. This intrinsic motivation makes
them more persistent and dedicated.

IMPORTANCE OF SALES MOTIVATION

Sales motivation plays a crucial role in the success of a sales team and, ultimately, the overall growth of a
company. A highly motivated salesperson is driven to perform better, stay resilient in challenging situations,
and create lasting relationships with customers. Organizations that prioritize sales motivation tend to have
higher revenue, lower employee turnover, and a stronger brand reputation.

Key Benefits of Sales Motivation

1. Setting and Achieving Higher Goals

Motivated salespeople tend to set ambitious targets and work hard to accomplish them. Their drive pushes
them to go beyond their comfort zones and achieve outstanding results.

Example:A financial services company encourages its sales representatives to set personal monthly sales
targets. Motivated by bonuses and career growth, employees aim to exceed these targets, leading to a
significant increase in revenue.

Example:An insurance company implements a leaderboard that highlights top-performing agents. The
recognition and rewards associated with being on top motivate employees to sell more policies and expand
their client base.

2. Encouraging Creativity and Innovation

Sales motivation fosters a mindset of continuous improvement, where salespeople experiment with new
techniques, explore different approaches, and think outside the box to attract customers.
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 Sales and Retail Management (22MBAMM304)

Example:A luxury watch retailer motivates its sales team by rewarding innovative sales techniques. One
salesperson uses social media to showcase new arrivals through engaging videos, significantly increasing
foot traffic to the store.

3. Enhancing Persistence and Resilience

Sales can be a challenging field with frequent rejections and obstacles. Motivated salespeople are more
likely to stay persistent, learn from failures, and keep pushing forward.

Example:A real estate agent, motivated by the goal of earning a top-tier commission, doesn’t get
discouraged by multiple client rejections. Instead, they refine their pitch, build better client relationships, and
eventually close a high-value deal.

Example:A salesperson in a B2B tech company faces repeated objections from a potential client. Instead of
giving up, they continue engaging with the client through value-driven emails, demonstrations, and problem-
solving discussions. Eventually, the client signs a long-term contract.

4. Improving Customer Service and Relationship Building

Motivated salespeople are not just focused on selling; they genuinely care about customer satisfaction and
long-term engagement. Their enthusiasm and passion make customers feel valued and respected.

Example:A car dealership trains and incentivizes its sales team to focus on customer needs rather than just
making quick sales. As a result, customers feel comfortable, trust the recommendations, and are more likely
to return for future purchases.

Example:A pharmaceutical sales representative follows up with doctors after selling a new medicine,
ensuring they understand its benefits and addressing concerns. This proactive approach builds credibility and
trust, leading to repeat business.

Why Sales Motivation Matters for Companies

1. Increased Sales and Revenue

A motivated sales team directly contributes to higher sales performance. Employees who are enthusiastic
and driven to achieve targets will close more deals, increasing the company’s revenue.

Example:
An e-commerce company sets up a monthly bonus system for sales representatives who exceed their targets.
This financial incentive boosts motivation, leading to a 20% increase in overall sales.

2. Improved Customer Satisfaction and Loyalty

Happy, motivated salespeople are more likely to provide excellent customer service, leading to satisfied
customers who return and refer others.

Example:A high-end hotel chain ensures its sales representatives are well-trained and incentivized to
prioritize customer experience. As a result, guests receive personalized services, leading to positive reviews
and repeat bookings.

3. Reduced Employee Turnover

A lack of motivation often leads to dissatisfaction and high employee turnover. When salespeople feel
valued, recognized, and rewarded, they are more likely to stay with the company long-term.
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 Sales and Retail Management (22MBAMM304)

Example:A software company implements an employee recognition program, offering top sales performers
promotions and leadership opportunities. This approach keeps employees engaged and reduces turnover.

4. Stronger Brand Reputation

A motivated sales team represents the company with enthusiasm and professionalism, which positively
influences the company’s market image.

Example:A direct-selling cosmetics brand invests in continuous training and incentives for its salesforce.
The well-trained, highly motivated representatives promote the products confidently, improving brand
perception and increasing market share.

PROCESS OF SALES MOTIVATION

Sales motivation is the process of instilling the desire and drive in a salesperson to achieve sales targets. It
involves arousing, maintaining, and directing behavior toward a goal. The extent to which a salesperson is
willing to exert effort depends on various motivational techniques and strategies. Below is a detailed
breakdown of the process of sales motivation and how it influences sales performance.

1. Setting Goals

The foundation of sales motivation begins with clear and achievable goals. Salespeople need well-defined
targets that challenge them while remaining attainable.

Why It Matters:

 Provides direction and purpose.

 Creates measurable benchmarks for success.
 Helps salespeople stay focused and driven.

Example:
A retail company sets a quarterly sales target of ₹5,00,000 for each salesperson. Breaking this down into
monthly and weekly sub-goals ensures that sales employees stay motivated and track progress effectively.

2. Recognition and Rewards

Recognition reinforces positive behavior by acknowledging and celebrating hard work and achievements.
It can be in the form of public appreciation, performance bonuses, or company-wide announcements.

Why It Matters:

 Boosts self-esteem and job satisfaction.

 Encourages a culture of excellence.
 Motivates others to strive for similar achievements.

Example:A company introduces a "Top Sales Performer" award, where the highest seller of the month
receives a trophy and a cash bonus. This encourages healthy competition and pushes employees to go the
extra mile.

3. Encouraging Healthy Competition

A sense of competition within the sales team can drive higher performance. When salespeople see their
colleagues excelling, it inspires them to push their limits and achieve better results.

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 Sales and Retail Management (22MBAMM304)

Why It Matters:

 Encourages continuous improvement.

 Increases motivation through friendly rivalry.
 Creates a dynamic and energetic sales environment.

Example:A leaderboard system is set up in a sales company where employees’ performance is displayed in
real-time. The top three performers receive incentives at the end of each month, motivating others to climb
the rankings.

4. Promoting Team Unity

Although sales can be competitive, it is equally important to foster teamwork and collaboration. A
motivated sales team is one that supports and uplifts each other rather than working in isolation.

Why It Matters:

 Encourages knowledge sharing and mentorship.

 Creates a sense of belonging and shared success.
 Reduces workplace stress by fostering mutual support.

Example:A sales organization organizes team-building activities such as group outings, brainstorming
sessions, and mentorship programs. These activities help build trust, strengthen relationships, and improve
overall morale.

5. Training and Development

Continuous learning and skill enhancement keep salespeople engaged and prepared for new challenges.
Training programs equip them with better sales techniques, negotiation skills, and product knowledge.

Why It Matters:

 Increases confidence and competence.

 Keeps salespeople updated with industry trends.
 Enhances adaptability to changing customer needs.

Example:A company conducts monthly sales training workshops where experienced mentors share new
selling strategies, handling objections, and digital marketing techniques to improve sales effectiveness.

6. Offering Incentives

Incentives act as powerful motivators by providing tangible rewards for hard work and dedication. These
can be in the form of bonuses, commissions, vacations, or luxury items.

Why It Matters:

 Directly links effort with rewards.

 Creates an extra push for higher performance.
 Helps in retaining top talent.

Example:A real estate firm offers an international vacation package to any salesperson who achieves a
sales target of ₹2 crores in a financial year. This high-value incentive drives employees to give their best
performance.

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 Sales and Retail Management (22MBAMM304)

7. Tracking Progress and Providing Feedback

A well-defined progress tracking system helps salespeople understand how close they are to reaching their
goals. Regular feedback sessions ensure that employees receive constructive guidance to improve
performance.

Why It Matters:

 Keeps employees accountable for their progress.

 Identifies areas for improvement.
 Encourages continuous motivation and adjustments.

Example:A company implements a digital dashboard where sales reps can track their daily, weekly, and
monthly performance. Sales managers provide bi-weekly feedback sessions to help employees stay
aligned with their goals.

8. Emphasizing Customer Satisfaction

A motivated salesperson is not just focused on hitting targets but also on delivering exceptional customer
service. Happy customers lead to repeat business, referrals, and brand loyalty.

Why It Matters:

 Strengthens long-term customer relationships.

 Improves brand reputation.
 Increases sales through word-of-mouth marketing.

Example:A software company rewards sales employees not just for the number of deals closed but also for
positive customer feedback ratings. This ensures that sales efforts are customer-centric rather than just
transactional.

FACTORS INFLUENCING SALES MOTIVATION

Sales motivation is influenced by a variety of factors, both intrinsic (internal) and extrinsic (external).
These factors determine how engaged, persistent, and productive a salesperson will be in their role.
Understanding these motivational drivers helps organizations create a work environment that fosters high
performance and job satisfaction.

1. Intrinsic Factors (Internal Motivation)

Intrinsic motivation comes from within the salesperson and is driven by personal fulfillment, passion, and a
sense of purpose. These factors do not necessarily depend on external rewards but rather on the individual's
internal desires and ambitions.

a) Achievement

Salespeople who are motivated by achievement have a strong desire to set and accomplish goals. They take
pride in hitting sales targets, surpassing their previous records, and continuously improving their
performance.

Example:A pharmaceutical sales representative sets a personal goal of increasing sales by 20% in the next
quarter. They proactively research new selling techniques, improve their customer interactions, and achieve
their target through dedication.

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 Sales and Retail Management (22MBAMM304)

b) Recognition

The need for recognition is a powerful motivator. Salespeople want to feel valued and appreciated for their
hard work. This could be through verbal praise, awards, or company-wide acknowledgment.

Example:A retail company introduces a "Sales Star of the Month" program, where top-performing
salespeople are recognized in front of their colleagues. This public appreciation boosts morale and motivates
others to perform better.

c) Autonomy

Salespeople often prefer control over their work—having the freedom to make decisions, manage their
time, and use their own selling techniques. When employees feel trusted, they are more engaged and
productive.

Example:A real estate agency allows its sales agents to set their own schedules and develop personalized
strategies to attract clients. This autonomy increases motivation and leads to better sales performance.

d) Mastery

Many salespeople are driven by the desire to improve their skills, knowledge, and expertise. They want to
become better at their job and continuously learn new sales techniques.

Example:A tech company provides regular sales training and workshops on negotiation skills and
handling customer objections. Sales reps who are eager to master their craft attend these sessions and
outperform their peers.

e) Purpose

Some salespeople are motivated by the feeling that their work makes a difference—whether it's helping
customers, solving problems, or contributing to a greater mission.

Example:A salesperson working for a solar energy company is driven by the fact that their work helps
people reduce their carbon footprint and save money on energy bills. This sense of purpose makes them
more committed and passionate about their job.

2. Extrinsic Factors (External Motivation)

Extrinsic motivation comes from external sources such as financial incentives, career opportunities, and
workplace conditions. These factors play a crucial role in keeping salespeople engaged and competitive.

a) Compensation

Financial rewards like commissions, bonuses, and salaries are among the strongest extrinsic motivators in
sales. The more a salesperson earns based on their performance, the more motivated they are to achieve
higher sales.

Example:A car dealership offers a 10% commission on every car sold. Salespeople who want to earn
more put in extra effort to close deals, increasing overall revenue.

b) Benefits

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 Sales and Retail Management (22MBAMM304)

Non-monetary rewards such as health insurance, paid leave, retirement plans, and wellness programs
also contribute to motivation. When employees feel financially secure and cared for, they are more likely to
stay motivated and loyal to the company.

Example:A software company provides comprehensive health coverage and flexible paid time off to its
sales team. Employees feel valued and, in return, are more dedicated to achieving their sales targets.

c) Career Advancement Opportunities

The potential for promotions, leadership roles, and skill development is a major motivator. Salespeople
want to see a clear career path where their hard work leads to greater responsibilities and higher earnings.

Example:A fast-moving consumer goods (FMCG) company has a structured career progression where sales
executives can move up to become regional sales managers based on their performance. This motivates
employees to push themselves harder.

d) Work Environment

The physical and social environment in which salespeople work can significantly impact motivation. A
supportive, energetic, and positive workplace boosts enthusiasm, while a toxic environment can lower
morale.

Example:A retail company designs a vibrant and interactive workspace where salespeople collaborate,
celebrate successes, and engage in friendly competitions. This energetic atmosphere keeps employees
motivated and driven.

e) Manager-Salesperson Relationship

The quality of leadership plays a huge role in sales motivation. Salespeople who receive support,
encouragement, and constructive feedback from their managers tend to be more engaged and high-
performing.

Example:A sales manager at a telecom company regularly meets with team members to discuss progress,
provide coaching, and celebrate small wins. This positive interaction keeps the team motivated and focused
on their goals.

COMPENSATION-MEANING

• Compensation is the payment or reward that an individual receives in exchange for their work. It can
include both monetary and non-monetary rewards.
• Monetary compensation is the most common form of compensation and includes salary, wages,
commissions, bonuses, and other forms of financial rewards. Non-monetary compensation includes
benefits such as health insurance, paid time off, retirement savings plans, and other perks.
• In the context of sales force motivation, compensation is particularly important. Salespeople are
typically motivated by financial rewards, so a competitive compensation plan is essential for
attracting and retaining top talent.
• By offering a competitive compensation plan that includes a mix of base salary, commissions, and
bonuses, companies can motivate their salespeople to achieve their sales goals and help the company
achieve its overall business objectives.

TYPES OF COMPENSATION PLANS FOR SALESPEOPLE

A well-designed compensation plan is essential for motivating salespeople and driving business success.
Different organizations use various types of compensation structures to align salesforce incentives with
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 Sales and Retail Management (22MBAMM304)

company goals. Below is a detailed explanation of common sales compensation plans, along with
examples of how each can be effectively implemented.

1. Salary-Based Compensation

Definition:

A fixed amount of compensation paid to a salesperson at regular intervals (e.g., weekly, biweekly, or
monthly). The salesperson receives this salary regardless of their sales performance.

Advantages:

 Provides financial stability to salespeople.

 Encourages sales reps to focus on long-term relationships rather than short-term gains.
 Attracts professionals who prefer job security over high-risk, high-reward earnings.

Disadvantages:

 May reduce motivation since earnings are not tied to performance.

 Some salespeople might lack urgency in closing deals.

Example:A pharmaceutical company pays its sales representatives a fixed monthly salary of ₹50,000,
ensuring that they focus on educating doctors about their products rather than pushing for immediate
sales.

2. Commission-Based Compensation

Definition:A performance-based compensation plan where salespeople earn a percentage of the revenue
they generate through sales.

Types of Commissions:

Straight Commission: Salespeople earn only from commissions, without a base salary.
Graduated Commission: The commission percentage increases as sales volume grows.
Tiered Commission: Different commission rates apply based on sales milestones (e.g., 5% for ₹1–5 lakh
sales, 10% beyond ₹5 lakh).

Advantages:

 High motivation as salespeople can increase their earnings by selling more.

 Encourages strong performance and competitiveness.
 Beneficial for companies with low fixed-cost budgets.

Disadvantages:

 May create income instability for salespeople.

 Some employees may focus on quick sales rather than long-term customer relationships.

Example:A real estate agent earns a 2% commission on every property sold. If they close a deal worth
₹1 crore, they earn ₹2 lakhs in commission.

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 Sales and Retail Management (22MBAMM304)

3. Bonus-Based Compensation

Definition:A lump sum payment awarded to salespeople when they achieve specific goals, such as
exceeding targets, acquiring new clients, or closing high-value deals.

Advantages:

 Acts as an extra incentive for exceptional performance.

 Helps in short-term goal achievement (e.g., end-of-quarter sales push).
 Boosts employee morale and job satisfaction.

Disadvantages:

 Can lead to short-term focus, with employees prioritizing bonuses over sustainable growth.
 Salespeople might delay sales to push them into the next bonus period.

Example:A FMCG company offers a ₹50,000 bonus to sales reps who exceed 150% of their quarterly sales
target.

4. Combination Plans (Salary + Commission + Bonus)

Definition:A hybrid compensation model that combines a fixed salary with commission and/or bonuses.
This approach ensures income stability while also rewarding performance.

Advantages:

 Balances income security and performance-based incentives.

 Encourages both relationship-building and aggressive selling.
 Suitable for industries with varying sales cycles (e.g., B2B sales).

Disadvantages:

 Can be complex to administer.

 If not well structured, the salary portion may reduce motivation to pursue commissions.

Example:A B2B software sales executive receives a fixed salary of ₹60,000 per month, a 5% commission
on sales, and an annual bonus of ₹1,00,000 for exceeding the annual revenue target.

5. Recognition Programs

Definition:Non-monetary incentives that reward top-performing salespeople through acknowledgment,

awards, and privileges.

Forms of Recognition:

 Employee of the Month/Year awards.

 Certificates, plaques, or trophies.
 Exclusive trips or experiences.
 Public appreciation at company meetings.

Advantages:

 Boosts self-esteem and job satisfaction.

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 Sales and Retail Management (22MBAMM304)

 Encourages a healthy competitive environment.

 Provides cost-effective motivation compared to financial incentives.

Example:A company holds a "Sales Champion Awards Night" where top performers receive trophies,
certificates, and public recognition.

6. Profit-Sharing Plans

Definition:A compensation plan where a portion of the company's profits is distributed among
employees. This ties their success to the company’s overall financial performance.

Advantages:

 Encourages long-term commitment to company success.

 Fosters a sense of ownership and teamwork.
 Helps attract and retain top talent.

Disadvantages:

 Employees have limited control over company-wide profits.

 May not motivate individual performance as directly as commissions or bonuses.

Example:A manufacturing company distributes 5% of its annual profits among employees based on
tenure and individual contributions.

7. Stock Options or Equity-Based Compensation

Definition:Companies offer stock options (ownership stakes) to salespeople, allowing them to benefit
from company growth.

Advantages:

 Creates a long-term investment in company success.

 Encourages loyalty and employee retention.
 Provides the potential for significant financial gains.

Disadvantages:

 Stock value is subject to market fluctuations.

 Employees may not immediately see the benefits, making it a less effective short-term motivator.

Example:A tech startup offers 100 stock options to each salesperson, which they can cash out after three
years if the company grows.

8. Benefits and Perks

Definition:Additional compensation elements beyond salary and commission, such as healthcare,

retirement plans, paid time off, travel allowances, company cars, and flexible work arrangements.

Advantages:

 Enhances employee satisfaction and well-being.

 Helps attract and retain top-tier talent.

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 Sales and Retail Management (22MBAMM304)

 Can improve work-life balance, leading to better performance.

Disadvantages:

 High costs for companies.

 May not be as immediately motivating as direct financial rewards.

Example:A luxury car dealership provides company cars to top-performing sales executives and offers
fully paid health insurance.

EVALUATION OF SALES FORCE: PERFORMANCE ASSESSMENT AND APPRAISAL

PROCESS

Evaluating a sales force is essential for ensuring productivity, improving sales strategies, and aligning
individual efforts with business objectives. A structured performance and appraisal process helps identify
strengths, areas for improvement, and opportunities for development. Below is an in-depth explanation of
the key components involved in evaluating a sales force.

1. Key Performance Indicators (KPIs)

Definition:KPIs are quantifiable metrics used to measure the performance of salespeople based on
predetermined sales goals.

Common Sales KPIs:

Sales Volume: Total sales generated by an individual or team within a given period.
Conversion Rate: Percentage of leads converted into actual customers.
Customer Acquisition: Number of new customers gained.
Average Deal Size: The typical revenue generated per sale.
Sales Cycle Length: The time taken from initial contact to closing a deal.
Customer Retention Rate: Percentage of repeat customers over time.

Example:A software sales company sets a KPI that each salesperson must close deals worth ₹10 lakhs
per quarter and maintain a conversion rate of 30% from leads to clients.

2. Regular Performance Reviews

Definition:Scheduled reviews (monthly, quarterly, or annually) to track progress, provide feedback,

and discuss achievements and challenges.

Purpose:

 Helps identify trends in performance.

 Allows salespeople to adjust their strategies based on feedback.
 Encourages accountability and continuous improvement.

Example:A FMCG sales manager conducts quarterly reviews to assess individual sales reps’ progress
and provide constructive feedback on improving customer engagement.

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 Sales and Retail Management (22MBAMM304)

3. Sales Metrics Analysis

Definition:A deep dive into sales data to identify patterns, strengths, and areas for improvement.

Metrics to Analyze:

Individual Performance: Comparing each salesperson’s actual sales vs. targets.

Team Performance: Evaluating team-wide productivity and collaboration.
Market Trends: Understanding how external factors (economic conditions, competitors) influence sales.

Example:A retail company notices that weekend sales are 20% higher than weekday sales, prompting a
shift in sales strategies to focus on peak hours.

4. 360-Degree Feedback

Definition:A holistic approach where feedback is collected from multiple sources—managers, peers,
subordinates, and customers.

Benefits:

 Provides well-rounded insights into sales performance.

 Highlights strengths beyond sales numbers (e.g., teamwork, leadership).
 Helps salespeople understand their impact on the team and customers.

Example:A B2B sales executive receives feedback from clients who appreciate their problem-solving
skills and responsiveness, helping them refine their sales approach.

5. Sales Activity Monitoring

Definition:Tracking daily sales activities such as calls, meetings, emails, and product demos to
measure effort levels.

Why It’s Important:

Ensures salespeople stay proactive in their approach.

Identifies bottlenecks in the sales process (e.g., too many calls but low conversions).
Helps optimize sales strategies based on successful behaviors.

Example:A sales team using CRM software (like Salesforce or HubSpot) tracks how many calls, meetings,
and follow-ups each rep completes per week.

6. Performance Appraisal Reviews

Definition:A formal evaluation process (annual or bi-annual) assessing both quantitative and qualitative
performance aspects.

Evaluation Criteria:

Quantitative: Sales volume, revenue generated, new customers acquired.

Qualitative: Communication skills, problem-solving abilities, teamwork.

Process:
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 Sales and Retail Management (22MBAMM304)

1. Self-evaluation: Salesperson reflects on their performance.

2. Manager evaluation: Sales manager assesses achievements and areas for improvement.
3. Discussion: Feedback is shared, and action plans are set.

Example:A telecom sales executive receives an annual performance review covering their sales numbers,
customer satisfaction scores, and teamwork contributions.

7. Goal Alignment

Definition:Ensuring individual sales targets contribute to the company’s overall business objectives.

Benefits:

 Keeps the team focused on the right priorities.

 Encourages collaboration between departments (e.g., sales & marketing).
 Helps salespeople understand their role in business success.

Example:A pharmaceutical company aligns its sales reps' targets with the company’s goal to increase
market share by 15% in the next year.

8. Development Plans

Definition:A structured plan for improving skills and performance based on appraisal results.

Key Elements:

Training Programs: Sales techniques, negotiation skills, CRM software usage.

Mentorship: Pairing salespeople with senior reps for guidance.
Workshops & Seminars: Continuous learning opportunities.

Example:A tech company identifies that its sales team struggles with handling objections and organizes
a sales negotiation workshop to enhance their skills.

9. Feedback Sessions

Definition:Structured discussions where managers provide constructive feedback on performance.

Best Practices for Effective Feedback:

 Be specific—focus on measurable actions rather than vague statements.

 Balance positive reinforcement with areas of improvement.
 Offer actionable solutions to help salespeople improve.

Example:Instead of saying, "You need to close more deals," a manager provides specific feedback:
"You have a strong lead generation process, but let's work on improving your follow-up strategy by using
personalized emails."

10. Reward and Recognition

Definition:Tying performance evaluations to incentives and recognition programs to reinforce positive

behavior.

Types of Rewards:

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 Sales and Retail Management (22MBAMM304)

 Monetary Incentives: Bonuses, commissions, profit-sharing.

 Non-Monetary Recognition: Awards, promotions, shout-outs in company meetings.
 Experiential Rewards: Paid vacations, event tickets.

Example:A real estate company awards its top sales agent a luxury vacation package for exceeding the
annual sales target.

SALES MANAGEMENT JOB: STANDARD SALES MANAGEMENT PROCESS

A standard sales management process is a structured approach that helps businesses guide potential
customers through the buying process, from initial awareness to closing the deal and beyond. It provides a
framework for sales teams to follow, ensuring consistency, efficiency, and improved sales performance. The
standard sales management process is essential for businesses to ensure a consistent and effective approach
to driving revenue. By following this structured process, sales teams can improve their chances of converting
leads into customers, maintaining long-term relationships, and boosting overall performance. Here’s a
breakdown of each key component:

1. Prospecting: This is the foundation of sales, where you identify leads who are likely to benefit from
your offerings. It involves market research, using lead-generation tools, and targeting individuals or
companies that align with your business’s ideal customer profile.
2. Connect and Qualify Leads: Once leads are identified, the next step is to reach out and qualify
them. This is done by asking key questions to assess their needs, budget, and authority in making a
purchasing decision. This stage helps determine whether it’s worth pursuing further.
3. Research the Company: Understanding the prospect's business, industry, and pain points can be a
game-changer. This knowledge allows for a more personalized sales pitch, demonstrating that you
understand their unique challenges and offering tailored solutions.
4. Presentation: The sales presentation is where you showcase your product or service, focusing on the
value it provides to the prospect. A successful presentation directly addresses their pain points and
positions your offering as the solution.
5. Handling Objections: Objections are a natural part of the sales process. Salespeople must be
prepared to handle objections by listening actively, empathizing with the customer’s concerns, and
offering clear, thoughtful responses that overcome hesitations.
6. Closing the Deal: This stage is about finalizing the sale. Negotiation skills are crucial here, as you
work to reach an agreement that satisfies both parties. Closing requires confidence and the ability to
ensure that both the customer and the business are aligned on terms.
7. Follow-up and Nurture Relationships: Sales don’t end after the deal is closed. Effective follow-up
ensures that the customer is satisfied, helps address any post-sale issues, and opens the door for
future opportunities like cross-selling or upselling.

INTERNATIONAL SALES MANAGEMENT

International sales management is a key component of global business expansion, enabling companies to tap
into markets beyond their domestic borders. This process involves strategic planning, cultural understanding,
and coordination across various regions to effectively sell products or services internationally. Here's an
overview of what international sales management entails:

Key Components of International Sales Management

1. Global Sales Team Management:

One of the main challenges of international sales management is effectively managing a
geographically dispersed sales team. This requires strong leadership and communication skills to
coordinate efforts across different time zones, cultures, and languages. Additionally, sales managers
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need to ensure that team members are trained on the company’s products, local market conditions,
and effective sales techniques.
2. Developing International Sales Strategies:
Crafting sales strategies for international markets is complex because it requires a deep
understanding of local consumer behavior, regulations, competitive landscape, and market demand.
Companies often need to tailor their offerings, marketing messages, and sales tactics to meet the
unique needs and preferences of each region.
3. Cross-border Trade Navigation:
Sales managers must be well-versed in the intricacies of international trade, including shipping,
tariffs, taxes, and compliance with local laws and regulations. This might involve working closely
with legal and logistics teams to ensure smooth operations and avoid potential risks.
4. Cultural Sensitivity and Adaptation:
Understanding cultural differences is crucial when selling internationally. What works in one country
may not resonate in another. International sales managers must be skilled in adapting their approach
to fit the cultural norms of the target market. This includes knowing the right communication styles,
negotiation tactics, and customer expectations.
5. Market Research and Localization:
Thorough market research is vital to understand the competitive landscape, potential demand, and
customer preferences in each country. Localizing the product or service offering to cater to specific
market needs—such as language adjustments, pricing strategies, and marketing channels—is also
critical to success.
6. Setting and Monitoring Sales Targets:
Just as with domestic sales, international sales managers need to establish clear and achievable sales
targets. However, these targets must account for the differences in market size, economic conditions,
and buying power across different countries. Tracking performance, adjusting strategies, and
providing regular feedback to the team are essential tasks in this regard.
7. Building Relationships and Partnerships:
Establishing strong relationships with local distributors, partners, and key decision-makers is often
key to succeeding in foreign markets. These relationships help build trust and credibility in new
markets, making it easier to navigate challenges and establish a presence.
8. Sales Training and Development:
Given the diverse nature of international sales teams and markets, ongoing training is essential. This
includes not only product training but also regional sales tactics, cultural awareness, and local
customer engagement strategies.
9. Technology and Communication Tools:
Utilizing technology is crucial for managing international sales effectively. This includes customer
relationship management (CRM) systems, video conferencing tools, and collaboration platforms that
help bridge the distance between teams and customers across the globe.

CHALLENGES

International sales management comes with numerous challenges that can significantly impact the success of
a business's global operations. Here’s a deeper dive into some of the key challenges:

1. Cultural Differences:

 Understanding local customs and traditions: Each country has its own business etiquette, social
norms, and communication styles. For instance, negotiating in Japan may be more formal and
involve multiple layers of decision-making, while in the U.S., direct communication might be
preferred.
 Building relationships: Trust and rapport can take time to develop, especially in cultures where
relationships are prioritized over transactions. Sales managers need to be sensitive to local practices
and establish strong personal connections to foster successful partnerships.

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 Adapting the sales pitch: A one-size-fits-all approach to selling doesn’t work across different
cultures. Sales managers must tailor their messages to resonate with local values, beliefs, and
consumer behavior.

2. Language Barriers:

 Communication issues: Language differences can lead to misunderstandings or the inability to

convey the full value of the product or service. Sales managers may need to rely on interpreters or
bilingual team members, but even with that, nuances and context can still be lost in translation.
 Localization of materials: Marketing materials, product documentation, and sales pitches need to be
accurately translated and culturally adapted. Mistakes in translation can be costly and damaging to
the brand image.
 Technological solutions: Sales managers might use automated translation tools or multilingual CRM
platforms, but these still often fail to capture the subtleties of language, especially in nuanced sales
conversations.

3. Regulatory Compliance:

 Different legal systems: Every country has its own set of laws governing business operations, sales,
marketing, pricing, and taxation. Sales managers need to stay informed about regulations such as data
protection laws, export restrictions, product safety standards, and intellectual property rights.
 Time-consuming paperwork: In many markets, complying with legal and regulatory requirements
often involves extensive documentation and approval processes. For example, exporting goods might
require obtaining permits, certifications, and clearance from customs authorities.
 Risk of non-compliance: Failing to comply with local laws can lead to financial penalties, damaged
reputation, or even being banned from operating in that market. Sales managers must have strong
legal guidance and operational procedures in place to mitigate risks.

4. Logistics and Supply Chain:

 International shipping and customs: Coordinating the movement of goods across borders involves
dealing with logistics providers, customs officials, and import/export documentation. The complexity
increases when shipping to multiple countries with varying regulations, fees, and lead times.
 Currency fluctuations: Changes in exchange rates can affect pricing strategies and profit margins.
Sales managers need to carefully monitor currency trends and adjust pricing accordingly to remain
competitive and profitable.
 Inventory management: Managing inventory in international markets is complex due to varying
demand levels, shipping times, and local storage regulations. Sales managers must ensure efficient
stock levels to avoid understocking or overstocking.

5. Market Research and Analysis:

 Identifying market opportunities: Understanding customer preferences, market size, competition,

and economic conditions is crucial for developing effective sales strategies. This requires gathering
and analyzing data from a variety of sources, including local market reports, surveys, and feedback
from distributors or partners.
 Adapting to market changes: International markets can be volatile, and consumer preferences can
shift rapidly. Sales managers need to remain agile and responsive to changing market dynamics,
trends, and competitor activities to stay ahead.
 Access to accurate data: Getting reliable and up-to-date market data can be difficult, especially in
emerging markets where data may not be readily available or is less consistent. Sales managers need
to build strong local networks and relationships to gain insights into market conditions.

6. Cross-Border Team Management:

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 Managing remote teams: International sales teams are often spread across various countries, and
managing such teams requires strong communication, coordination, and leadership skills. Time zone
differences can create difficulties in scheduling meetings and ensuring consistent collaboration.
 Diverse skill sets: Salespeople in different countries may have different strengths and challenges due
to varying levels of experience, cultural background, or familiarity with the company’s products or
services. Sales managers must provide effective training and support to ensure that all teams are
performing at their best.

7. Pricing and Payment Terms:

 Setting competitive prices: Pricing strategies need to be adjusted for local economic conditions,
purchasing power, and competitor prices. In some countries, high import duties or local taxes can
make products more expensive, while in others, local currency depreciation may require lower prices
to remain competitive.
 Dealing with payment issues: Different countries have varying preferences for payment methods,
including wire transfers, credit cards, or local payment gateways. Sales managers need to understand
these preferences and ensure that payment terms are clear and aligned with local practices to avoid
delays.

STRATEGIES FOR SUCCESS IN INTERNATIONAL SALES MANAGEMENT

1. Develop a Clear International Sales Strategy:

 Set Clear Objectives: Define the company’s goals for international markets, whether it's increasing
revenue, expanding brand presence, or entering new markets. These goals will provide direction and
help measure success.
 Identify Target Markets: Focus on countries or regions that align with the company's strengths,
products, and potential for growth. This includes evaluating factors such as market demand,
economic stability, and competition.
 Sales Channels: Determine the most effective sales channels for each market, whether it’s direct
sales, partnerships, e-commerce platforms, or a mix. Understanding the local buying behavior and
preferences will help optimize the strategy.

2. Build a Strong Global Sales Team:

 Diverse Skill Sets: Hire or develop a team that understands the nuances of selling in various
cultures, markets, and industries. This includes training on cultural differences, negotiation styles,
and local consumer behavior.
 Multilingual Capabilities: Ensure that the team has multilingual capabilities or access to translation
tools to effectively communicate with customers in different languages.
 Local Expertise: Consider having local representatives or team members in key markets who can
better navigate the unique challenges of those regions. They can provide insights into customer
preferences and offer guidance on market trends.
 Collaboration and Communication: Foster a collaborative culture, even if the team is
geographically dispersed. Utilize communication tools and establish regular touchpoints to align on
goals, updates, and challenges.

3. Partner with Local Distributors or Representatives:

 Leverage Local Knowledge: Forming partnerships with local distributors or representatives can
help businesses understand the market dynamics and customer preferences in a specific region. These
partners can assist with navigating local regulations, customs, and consumer habits.

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 Regulatory Navigation: Local partners are also invaluable when it comes to understanding and
complying with regulations, such as tariffs, taxes, and compliance with consumer protection laws.
 Market Access: A well-established local distributor or representative may already have an extensive
network and relationships with key decision-makers, which can help accelerate market entry and
expansion.

4. Invest in Market Research:

 Understand Customer Needs: Conduct thorough market research to understand the unique needs,
pain points, and preferences of customers in each target market. This research can reveal potential
opportunities or gaps in the market that your products or services can address.
 Analyze Competitors: Study local competitors to understand their offerings, pricing, and sales
tactics. This can help identify potential weaknesses in the competitor’s strategy and differentiate your
product.
 Track Market Trends: Monitor global and local economic trends, consumer behavior changes, and
emerging technologies to stay ahead of the competition and adapt to shifting market conditions.
 Use Data Analytics: Leverage data analytics tools to gather insights from customer interactions,
sales patterns, and market feedback to inform strategy and decisions.

5. Comply with All Applicable Laws and Regulations:

 Stay Informed on Local Laws: Each country has its own laws related to business operations,
product safety standards, advertising, taxes, and more. Non-compliance can lead to penalties, delays,
or damaged reputation.
 Consult Legal Experts: Work with local legal experts to ensure that your business is in full
compliance with local regulations. This can include understanding import/export regulations, labor
laws, intellectual property rights, and data protection policies.
 Customs and Tariffs: International sales often involve customs clearance, tariffs, and duties.
Understanding these regulations and factoring them into pricing strategies can help avoid delays and
unexpected costs.
 Ethical Standards: Adhere to ethical business practices and corporate social responsibility
standards. Ensuring your business practices are fair and sustainable will enhance the company’s
reputation and customer loyalty in global markets.

6. Adapt Your Marketing Strategy:

 Cultural Sensitivity: Tailor marketing messages and campaigns to reflect the cultural values and
preferences of each market. This includes customizing advertising content, promotional strategies,
and even product features to meet local tastes.
 Localization of Content: Ensure all marketing materials (brochures, websites, social media) are
properly localized to match the language and cultural context of the target market.
 Digital Marketing Channels: Use the most popular and effective marketing channels in each
market, whether it’s social media, search engines, local influencers, or traditional media. This varies
greatly by region.

7. Monitor and Optimize Sales Performance:

 Track KPIs: Set specific key performance indicators (KPIs) such as revenue targets, conversion
rates, and customer satisfaction scores. Regularly assess progress against these metrics and adjust
strategies as needed.
 Customer Feedback: Gather feedback from international customers through surveys, reviews, and
one-on-one interviews to identify areas for improvement in your products or sales process.

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 Continuous Training: Provide ongoing training for the sales team to keep them updated on product
features, sales techniques, and market changes. This ensures the team stays competitive and
knowledgeable in their respective markets.

8. Leverage Technology and CRM Tools:

 Customer Relationship Management (CRM): Use CRM software to track sales leads, customer
interactions, and sales performance across different regions. This helps keep a unified view of global
sales activities and enhances customer engagement.
 Sales Automation: Invest in sales automation tools that can help streamline lead generation, follow-
ups, and customer communication across international markets.
 Collaboration Tools: Use digital platforms like video conferencing, cloud storage, and project
management software to enhance collaboration between remote teams and local partners.

INTERNATIONAL SALES MANAGEMENT TOOLS AND RESOURCES

International sales management relies heavily on the right tools and resources to effectively navigate the
complexities of global markets. Here are some key tools and resources that can support international sales
managers in achieving success:

1. Customer Relationship Management (CRM) Software:

 Track Customer Interactions: CRM systems help sales managers track and manage all interactions
with international clients, ensuring no lead or communication is overlooked.
 Sales Pipeline Management: A CRM can help in organizing sales opportunities, from initial contact
to closing, providing a clear view of the sales pipeline. This allows sales teams to forecast revenue
and plan their efforts accordingly.
 Collaboration and Coordination: CRM platforms enable seamless collaboration across remote and
international teams, allowing them to share insights, notes, and updates on client status, preferences,
and potential opportunities.
 Reports and Analytics: CRM systems generate detailed reports on sales performance, lead
conversion rates, and customer behavior, helping sales managers make data-driven decisions to
improve strategy.

Popular CRM Tools:

 Salesforce
 HubSpot
 Zoho CRM
 Microsoft Dynamics 365

2. Translation Services:

 Overcome Language Barriers: Language is a significant barrier in international sales. Translation

services ensure that product descriptions, contracts, promotional materials, and customer
communications are accurately translated into the target market's language.
 Cultural Appropriateness: Professional translation services often provide cultural context for
marketing and sales materials, ensuring that they are not only linguistically correct but also culturally
relevant.
 Consistency in Communication: A translation service can help maintain a consistent brand voice
across different languages, which is important for building brand recognition and trust with
international customers.

Assistant Professor Archana M, MBA, AIET, Bengaluru 562110

 Sales and Retail Management (22MBAMM304)

Types of Translation Services:

 Professional translation agencies (e.g., TransPerfect, SDL)

 Online platforms like Google Translate (for basic translation)
 Local translators with expertise in the target market’s culture

3. International Trade Organizations:

 Market Insights: International trade organizations, such as the International Trade Centre (ITC) and
World Trade Organization (WTO), offer valuable resources to help companies understand trade
regulations, market access, and industry-specific trends in various regions.
 Networking Opportunities: These organizations often provide opportunities to connect with other
businesses, industry experts, and potential partners, facilitating collaboration and trade.
 Export Guidelines and Resources: They can also offer advice on navigating international sales
challenges, including export documentation, trade policies, and regional customs regulations.

Key Trade Organizations:

 International Trade Centre (ITC)

 World Trade Organization (WTO)
 U.S. Commercial Service
 European Union’s Trade and Agriculture Commission

4. Government Agencies:

 Export Assistance: Government agencies, such as the Export-Import Bank (EXIM), can offer
support for businesses looking to expand their international sales by providing export financing,
insurance, and grants.
 Promote Trade Opportunities: Many governments have departments dedicated to promoting
international trade, such as the U.S. Department of Commerce or the UK’s Department for
International Trade (DIT). These agencies offer guidance on trade regulations, market research, and
legal compliance.
 Trade Missions and Partnerships: Government-sponsored trade missions or partnerships with
foreign governments help businesses enter new markets and build relationships with local
distributors or customers.

Examples of Government Resources:

 Export-Import Bank (EXIM)

 U.S. Department of Commerce (International Trade Administration)
 UK Department for International Trade (DIT)
 Canada Border Services Agency (CBSA)

5. Cross-border Payment Platforms:

 Currency Management: International payments can be tricky due to fluctuating exchange rates.
Platforms that manage multi-currency payments can help businesses avoid costly errors and simplify
transactions with international clients.
 Secure Payments: These platforms provide secure ways to process payments across borders, which
is essential for ensuring smooth financial transactions.

Popular Payment Solutions:

 PayPal for international transactions

Assistant Professor Archana M, MBA, AIET, Bengaluru 562110

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 TransferWise (now Wise) for low-cost currency exchange

 Stripe for international online payments
 Payoneer for cross-border transactions

6. Global Shipping and Logistics Tools:

 Track Shipments: Global shipping tools and platforms can help manage international shipments,
track deliveries, and ensure timely customs clearance.
 Cost Optimization: These tools assist in calculating the most cost-effective shipping routes and
methods, ensuring competitive pricing in international markets.
 Customs Compliance: Global logistics platforms often provide resources for managing customs
paperwork and ensuring compliance with local import/export laws.

Popular Shipping Solutions:

 DHL Global Forwarding

 FedEx International Shipping
 UPS Worldwide Services
 Shippo for multi-carrier shipping management

7. Digital Marketing and Social Media Tools:

 Target Local Audiences: Digital marketing platforms like Google Ads, Facebook Ads, and
LinkedIn allow businesses to target international customers through paid ads, organic content, and
social media strategies.
 Localized Content: Social media management tools like Hootsuite, Sprout Social, and Buffer help
businesses create and schedule localized content across multiple social media channels, ensuring
consistent global branding.
 Engage with Customers: Using digital tools to monitor customer behavior, respond to inquiries, and
build a community can help businesses enhance customer satisfaction and loyalty across different
countries.

Popular Digital Marketing Tools:

 Google Ads
 Hootsuite or Buffer for social media management
 SEMrush or Moz for search engine optimization
 Mailchimp for email marketing campaigns

INTERNATIONAL MARKET SELECTION

Selecting the right international market is a crucial step in the global expansion process. By focusing efforts
on the markets with the highest potential, businesses can maximize their chances of success. The process
involves several steps and factors to ensure that the chosen markets align with the company’s strengths and
strategic goals. Below, we’ll elaborate on each aspect of international market selection, as well as the
importance of a market survey approach.

Factors to Consider in International Market Selection

When selecting international markets, there are various factors that companies need to evaluate to ensure a
successful market entry:

1. Market Demand:

Assistant Professor Archana M, MBA, AIET, Bengaluru 562110

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o Size and Growth Potential: Look for markets where there is significant demand for your
products or services. This includes understanding the market size, growth trends, and the
future potential for expansion. Analyze factors like population size, purchasing power, and
customer needs in the region.
o Consumer Trends: Understanding shifts in consumer preferences and emerging trends can
help assess whether your product will be in demand now and in the future.
2. Competition:
o Competitive Landscape: Assess the level of competition in the market, including the
presence of dominant players and their market share. A market with too many established
competitors might be more difficult to penetrate.
o Competitor Strengths and Weaknesses: Evaluate competitors’ offerings, pricing strategies,
and distribution channels to identify any gaps or opportunities for differentiation.
3. Market Access:
o Regulatory Environment: Evaluate the ease of entering the market in terms of trade barriers,
tariffs, quotas, and regulatory requirements. Consider whether the market is open to foreign
investment or if there are restrictions that might hinder operations.
o Logistics and Infrastructure: Understand the logistical challenges, including shipping
routes, transportation infrastructure, and accessibility for delivering goods and services to
customers.
4. Country Risk:
o Political and Economic Stability: Investigate the political climate, economic policies, and
stability of the country. Countries with unstable governments, high inflation rates, or
unpredictable economies may pose a higher risk.
o Social and Legal Environment: Assess the legal framework, intellectual property protection,
labor laws, and the general business climate. Markets with strong legal protections can
provide a safer environment for international businesses.
5. Cultural Compatibility:
o Cultural Fit: Consider the cultural alignment between your company’s offerings and the
market’s consumer behaviors, preferences, and values. Cultural differences can significantly
influence product acceptance, marketing approaches, and overall success.
o Language Barriers: Language differences can affect marketing strategies and customer
service. Understanding how language impacts business interactions and product acceptance is
essential.
6. Resource Availability:
o Skilled Labor: Assess the availability of skilled workers who can help run your business in
the new market. A lack of qualified labor can make it more difficult to operate efficiently.
o Infrastructure and Technology: Ensure that the market has the necessary infrastructure and
technological capabilities for business operations, including access to reliable internet,
telecommunications, and transportation networks.

METHODS OF INTERNATIONAL MARKET SELECTION

Companies can use a variety of methods to select the right international markets. Each method provides
valuable insights, and often, a combination of these methods yields the best results:

1. Desk Research:
o Desk research involves gathering data from secondary sources such as government reports,
industry publications, trade associations, and market intelligence databases. It’s a cost-
effective way to quickly gather broad insights about potential markets.
o Pros: Cost-effective, easy access to historical data.
o Cons: Limited to existing, published data; may not provide current, real-time insights.
2. Field Research:

Assistant Professor Archana M, MBA, AIET, Bengaluru 562110

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o Field research entails collecting primary data through direct interaction with potential
customers, distributors, or local experts in the target market. This could include surveys,
interviews, and focus groups.
o Pros: Provides up-to-date, specific insights directly from the market.
o Cons: Can be costly and time-consuming to conduct.
3. Consultants:
o Consultants with expertise in international market selection can provide valuable guidance,
leveraging their experience and knowledge of specific regions to help identify the best
markets.
o Pros: Expert knowledge and insights.
o Cons: Can be expensive.
4. Trial Exports:
o A company can conduct small-scale exports to a few selected markets to assess demand,
customer behavior, and logistical challenges before committing to full-scale operations.
o Pros: Provides real-world experience in the market without heavy investment.
o Cons: May not be fully representative of long-term trends.

STAGES OF INTERNATIONAL MARKET SELECTION

The international market selection process is typically broken down into several stages to ensure thorough
evaluation:

1. Screening:
o In this initial stage, a broad range of potential markets is identified. Companies often use
secondary data (desk research) to eliminate markets that are too risky, unattractive, or
unaligned with their capabilities.
o Focus on factors like market size, growth rate, and political stability.
2. Evaluation:
o Here, companies assess the potential of each market using criteria such as demand,
competition, access, and risk. A more detailed analysis is conducted to compare and contrast
markets.
o Metrics such as ease of doing business, profitability, and market accessibility are used in the
evaluation.
3. Shortlisting:
o Based on the evaluation, a shortlist of the most promising markets is created. These markets
should align with the company's goals and capabilities and offer significant growth potential.
o This stage involves narrowing down options based on priority factors like return on
investment, market demand, and competitive advantage.
4. Detailed Analysis:
o In-depth research is conducted on each of the shortlisted markets. This may include field
research, speaking with local partners, and exploring logistical or regulatory requirements.
o A comprehensive market entry strategy should be developed based on the findings of this
stage.
5. Market Selection:
o After thorough analysis, the final decision is made, and the company selects the market that
offers the greatest potential for success. At this stage, the company can start preparing for
market entry.

STRATEGIES FOR INTERNATIONAL MARKET ENTRY

Once a market has been selected, the next step is deciding on the appropriate market entry strategy. Some of
the most common methods include:

1. Direct Exporting:

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o Selling directly to foreign customers through online platforms or sales representatives.

2. Indirect Exporting:
o Selling through intermediaries like distributors, agents, or wholesalers.
3. Licensing:
o Allowing a foreign company to use your intellectual property, brand, or technology in
exchange for fees or royalties.
4. Franchising:
o Licensing a foreign company to operate a business using your brand and standards.
5. Joint Venture:
o Partnering with a local firm to share resources and responsibilities in entering the market.
6. Foreign Direct Investment (FDI):
o Establishing a physical presence in the market, such as building a factory or acquiring a local
company.

MARKET SURVEY APPROACH OR STRATEGY

Conducting a market survey is vital for gathering real-time, actionable data about the market. The chosen
approach will depend on factors such as the type of information needed, the target audience, and available
resources.

Key Steps in Developing a Market Survey Strategy:

1. Define the Objectives: Clearly define what the survey aims to achieve. Are you testing product
demand, consumer preferences, or pricing strategies?
2. Develop a Research Plan: Outline the methodology (quantitative, qualitative, or mixed), data
collection techniques (online surveys, interviews, focus groups), and analysis approach.
3. Collect Data: Implement the research plan by conducting the surveys or interviews.
4. Analyze Data: Use statistical or thematic analysis techniques to draw conclusions from the data
collected.
5. Draw Conclusions: Interpret the data and gain insights into market trends, consumer behaviors, and
preferences.
6. Make Recommendations: Based on the conclusions, suggest actionable steps for market entry,
product development, or marketing strategies.

Assistant Professor Archana M, MBA, AIET, Bengaluru 562110

 Sales and Retail Management (22MBAMM304)

Module-4

Retail Management: Introduction and Perspectives on Retailing, World of Retailing, Retail management,
introduction, meaning, characteristics, emergence of organizations of retailing - Types of Retailers (Retail Formats) -
Multichannel Retailing - role of retailing, trends in retailing, FDI in Retail - Problems of Indian Retailing- Ethics in
retailing- Current Scenario.

Module-5

Setting up Retail organization: Size and space allocation, location strategy, factors Affecting the location
of Retail, Retail location Research and Techniques, Objectives of Good store Design. Retail Market
Strategy - Financial Strategy Human Resource Management, Information Systems and supply chain
management & Logistics. Store Layout and Space planning: Types of Layouts, role of Visual
Merchandiser, Visual Merchandising Techniques, Controlling Costs and Reducing Inventories Loss,
Exteriors, Interiors. Store Management: Responsibilities of Store Manager, Store Security, Parking Space.
Problem at Retail Centers, Store Record and Accounting System, Coding System, Material
Handling in Stores, Management of modern retails stores.

Module-6

Relationship Marketing & International Retailing: Management & Evaluation of Relationships in Retailing, Retail
Research in Retailing: Importance of Research in Retailing, Trends in Retail Research, Areas of Retail Research.
Customer Audits, Brand Management in retailing, Internationalization of Retailing and Evolution of International
Retailing, Motives of International Retailing, International Retail Environment and issues in international retailing

Assistant Professor Archana M, MBA, AIET, Bengaluru 562110