sales management zeus co. case topic 15. stop! read the case! answer the questions
TRANSCRIPT
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Sales Management
Zeus Co. Case
Topic 15
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Stop! Read the Case!Answer the Questions
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Chasing Lower Costs
• Information = Speed of Light• Logistics = Speed of a Truck or Boat• Flexibility vs Lowest Cost
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Independent Reps vs Salespeople
• Independent Reps– Advantages– Disadvantages
• Company Salespeople– Advantages– Disadvantages
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Luck or What?
• Glen Whitener – What is your letter grade?• Think this through carefully
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Glen is at least an A-
• What Options Did He Have?• Limited Budget Marketing• Luck • And Taking Advantage of Luck
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Price Increase
• Great Job!• But Moving Faster?• Take Advantage of this Strategically
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Fad Product or Not?
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How Do You Forecast Fads?
• Let me know when you figure this out• Cost of Over-Producing• Cost of Under-Producing• Which Can You Recover From?
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Don’t Get Lost in Production
• Danger of Narrowly Focusing• Production or Logisitics• Sales Forecasting• Profit is Our Goal – Not what is easy or
convenient for an operational silo
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Manufacturing Contract Options
• Depends on Sales Forecast• Weighted Average is Still A Guess• A More Math Intensive Answer Does Not
Make It The Right Choice• Why Dr. A Holds This Opinion
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Break-Even Between Sales Forces
• Obvious Answer – Use Reps• Logically, What is the Job?• How Easy to Get Replacements?
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Setting Up the Problem
• 3 Person Sales Force• $40k salary + $15k Benefits and .005
commission• Versus 12.5% Commission
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Solution
• 3 ($65,000) + .005x = .125x• X = $1,375,000• Tie to Your Sales Forecast• Money On Table is Substantial For Most• Other Option (unlisted in case)
– Lower Commission Rate
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Independent Rep Reaction
• Look at New College Student• Look at Experienced Rep• Minimize Cost is Offer Job to Reps
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Management Bonus Pool
• How Would This Work?• Consequences Are Clear• What Are the Risks to Glen?• How Should Glen Handle This?
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What Have We Learned Today?
• Not All Problems Have Math Centric Solutions
• Sometimes You Prepare For Best Guess Choice
• Examine Problems From Different Viewpoints• Run Costs
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What Have We Learned?
• When Do Legal Issues Pop Up?• Politics of A Legal or Ethical Dilemma• Choose Well Luke!