WGU Sales Management D099 Western Governors University Module 11 latest updated version with expert solutions + rationales

planning

the process by which sales managers establish goals and specify how those goals are to be attained.

control

the process of setting standards, comparing results achieved to the standards, and taking corrective action.

purposes of a budget

-plan and control the use of scarce resources

-reveal the company's objectives and how management intends to acquire and use resources to attain those objectives

-to provide a comparison of actual results to the plan of achieving those objectives.

two components of a sales budget

-forecasted sales

-costs to bring a new product to market

long-run planning

focuses on decisions that will have benefits that will extend several years in the future. Incorporates strategic panning and capital budgeting

short-term planning

focuses on the the near term with operational budgeting and production forecasts.

budgeting

optimizes scarce resources and shows a defined path to achieve an organizations mission and goals.

forecasting

the process of predicting the outcome of events

three step process for sales forecasting

-survey the current and economic and business decisions.

-Develop and industry-specific sales forecast after looking at competitors. past, present and future activity.

-Forecast the company's share of the market while considering current business, marketing, and sales planning activities.

sales budget two key outputs

sales budget

selling expense budget

Full Product Costing/absorption costing

-A costing method in which the complete end-to-end costs of producing products and services are determined

-considers every cost incurred by the business

-direct costs are traced to their cost objects

-indirect (overhead) costs are allocated

contribution margin income statement

the company's variable expenses are deducted from sales. Fixed deductions are done afterward.

Activity Based Costing

-costing method that assigns indirect costs to activities and products based on each product's use of activities.

-often used to analyze internal processes

-only considers cost that are directly traceable to a product or process

Five steps to ABC

1-Identify activities

2-Identify cost drivers

3-Compute a cost driver rate

4-assign costs to products

5-Make decision

identify activities

activities that are performed to sell the products or services.

identify cost drivers

cost driver is an activity or a transaction that incurs costs. cost driver could be the number orders placed or the number of items ordered.

activity center

unit of the organization that performs some activity.

return on assets managed (ROAM)

Measurement of a profit that is used to evaluate marketing proposals.

-Contribution of sales x asset turnover rate

To Calculate roam

1-calculate the profit on sales

2-Divide the sales by total assets

3-multiply the two results

What does Roam show?

-How well and organization can generate a profit by using its assets

-Both the earnings as a percent of sales and the rate that assets are turned over

customer profitability analysis

the reporting and assessment of revenues earned from customers and the costs incurred to earn those revenues

carriage trade

These customers generate high revenue but could also be expensive to serve. They can be profitable if the cost to serve them is lower than the revenue they generate.

bargain basement

These customers do not require much service, but they also do not generate high profits. They tend to be sensitive to price and relatively insensitive to service and quality.

passive customers

These customers do not generate high costs, but they are willing to accept high prices. These customers can generate the highest revenues at the lowest costs. They may need a specific product or be unwilling to switch to another provider due to the high cost of switching, or the cost of the product or service is insignificant in terms of their overall operations.

aggressive customer

These customers not only demand the highest product quality and the best service but also want lower prices. These customers tend to be influential buyers who are accommodated by business for reasons other than profit.

four box matrix

based on whether customers or customer groups are considered profitable to the company and whether they fit the competitive strategy of the company.

sales operations

The planning process that helps firms provide better customer service, shorter lead times, and allows top management to get a handle on the business is known as ____ planning.

sales forecasting

process of evaluating the overall market for its market potential to predict the sales potential for and individual firm.

sales potential forecast

Describes the number of prospects and their buying power

RACI Matrix

A responsibility assignment chart that maps out tasks, milestones, and key decisions and assigns the roles of responsible, accountable, consulted, and informed

RACI

Responsible, Accountable, Consult, Inform