Sales quota: Known as sales target, sales quota is an expression of
sales value and sales volume expected from a salesperson to be achieved in full
from their defined territory over a given period of time i.e., weekly, monthly,
quarterly or yearly. In simple sense, a sales quota is a goal; it is a target a
sales staff is expected to meet. Each sales person must understand the
importance of their target and how it fits in as part of the pre-set goals
stated in business plan of an enterprise. They are a way of life for the sales
force. All activities of the sales force revolve around fulfillment of sales
quotas. As already mentioned, sales quotas are the targets assigned to sales
personnel, they also signify the performance expected from them by an
organisation. Sales quotas help directing, evaluating and controlling the sales
force. They forman indispensable tool for sales managers to carry out sales
management activities. Sales quotas are prepared on the basis of sales
forecasts and budgets. They provide targets for sales personnel to achieve, act
as standards to measure sales force performance and help motivate the
salesforce. Compensation plans are invariably linked to quotas. The commission
and bonuses given to sales persons are also based on their meeting the quotas
set for them.
Sales
Force: Sales Force is the term used for the division of a
business that is responsible for selling products or services. Sales force
means persons responsible for selling products or services via direct contact
with the customers.
Today, most industrial companies rely heavily on a
professional sales force to locate prospects, develop them into customers and
grow the business.
Some companies hire ’manufacturers’ representatives’
and ’agents’ to carry out the direct selling task. In addition, many consumer
companies use a direct-selling force such as insurance agents, stock brokers
and distributors. Sales force members may be paid a fixed salary regardless of
sales volume or may receive a small base salary plus commissions calculated as
a percentage of revenue sold. Non-commissioned sales forces are appropriate
when selling requires the involvement of a team of individuals or when there is
an extremely long sales cycle. For example, some complex industrial services
may require several years of effort before the prospect is sold. Salespeople
may be full-time employees of the seller or may be independent, nonexclusive
agents.