But for the variable component a scale to be used Performance 75 percent

But for the variable component a scale to be used

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But for the variable component, a scale to be used: Performance 75 percent, variable component = nil Performance 76 percent to 85 percent, variable component = 85 percent Performance 86 percent to 97 percent, variable component = 95 percent Performance 98 percent to 100 percent, variable component = 100 percent Performance 101 percent to 105 percent, variable component = 110 percent Performance 106 percent & above, variable component = 115 percent Applying the above yard stick to the three salesmen their compensation would be: Table no: 6.5 Sales man Fixed component Performance percentge Variable component Total compensation A 10000 96 percent 95 percent of 5000 = 4750 14750 B 10000 102 percent 110 percent of 5000 = 5500 15500 C 10000 107 percent 115 percent of 5000 = 5750 15750 108
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SALES FORCE EVALUATION In most of the FMCG or Pharmaceutical sales, the company tracks sales at two levels viz. primary and secondary. Primary sales are the sales that take place from the company to the first link in the external chain of intermediaries viz. the Distributor or the Stockist. This sale is the one that is reckoned to calculate the company’s turnover. However the company needs also to track the movement of stocks from the Distributor’s or Stockist’s end, because that will show the off take and also be indicative of the future likely billing to the Distributor/ Stockist. This sale from the Distributor/ Stockist to the Retailers is termed Secondary sales. Though Secondary sales do not add to the turn over of the company, they are extremely important for the company to keep a track of. Companies link the secondary sales to the primary sales and collect/ book orders from the Distributors/ Stockists after a comparative evaluation of the sales at both the levels. A sample order form incorporating the above factors is given below: Table no: 6.6 Journey stock sales and order form Distributor: Sales man: Date: prdct A prdct B prdct C prdct D prdct E 12.06.08 stocks on hand as on date 35 190 0 25 87 11.07.08 opening stocks on 13.06.08 (copied from previous visit’s recorded closing stocks) 35 190 0 25 87 11.07.08 previous visit’s ordered materials, that have been supplied in the interim period (13.06.08 to 11.07.08) 120 36 260 96 0 11.07.08 total 155 226 260 121 87 11.07.08 stocks on hand as on date 36 200 0 36 83 109
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SALES FORCE EVALUATION In the above ' Journey stock sales and order form ' the salesman during his visit first copies from the previous visit records the opening stocks for the period under observation. He then adds the material that has been supplied to the Distributor in the period under consideration (primary sales of the company). He also obtains the stocks on hand as on the current date of his visit. He can then derive the Secondary sales made by the Distributor, during the period under review, in this case the period 13.06.08 to 11.07.08. Now his task of taking the next order is made very scientific, as he can easily estimate what may be the likely off take during the next period, and after accounting for the stocks that are in hand, and also factoring in any impact due to promotional inputs planned for the ensuing period he can make a fairly reasonable estimate of the order that should be taken. The Distributor also
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