Types and structures of sales organization

1. TYPES AND
STRUCTURES
OF SALES
ORGANIZATION
DATE:
06/08/2021

2. WHAT IS SALES
ORGANIZATION?
Sales organization
is a department in
company within
logistics that
designs the
company as per
the sales
requirements.
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3. CHARACTERISTICS OF SALES
ORGANIZATION
• A sales organization subsists of a group of people who handle different activities like
distribution, advertising, selling etc.
• It works to achieve the sales objectives, like increasing sales volume and maximizing
profit and market share of the company.
• It specifies the responsibilities and duties of the salesperson and also co-ordinates their
activities with other departments.
• It helps to develop a relationship with the other personnel in the organization by setting
up a sales programe.
• General Sales Manager is the head of the sales organization.
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4. BASIC TYPES OF SALES
ORGANIZATIONS
• Line Organization.
• Line and Staff Organization.
• Functional Organization.
• Horizontal Organization.
Sales organizations are generally classified into four basic types:
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5. LINE ORGANIZATION
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6. All managers have line authority to direct and control
subordinates. Used in small firms / departments
Characteristics
Simple organization, clear authority, quick decisions, low cost
Advantages
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No support to line managers from subordinates who have specialized knowledge
/ skills. Less time for planning / analysis
Disadvantages

7. LINE AND STAFF ORGANIZATION
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8. Specialist staff managers are available for senior
marketing / sales managers. Staff managers’ role is
to assist / advise line managers. Used in medium
and large size organizations
Characteristics
Better marketing decisions, superior sales performance
Advantages
8
High cost and coordination, slower decision making, conflict may arise if staff
managers’ role is not clear
Disadvantages

9. FUNCTIONAL ORGANIZATION
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10. Each functional specialist has line responsibility
over salespeople. Used by a large firm with many
products / market segments, minimizing line
authority to functional managers
Characteristics
Qualified specialists guide sales force, simple to administer
Advantages
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confusion due to more managers giving orders to sales force
Disadvantages

11. HORIZONTAL ORGANIZATION
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12. Removes management levels & departmental
boundaries. Except planning team, all others are
members of cross- functional teams. Used by firms
having partnering relationships with customers.
Characteristics
Reduction in supervision, unnecessary tasks, & cost; Improved
efficiency and customer responses.
Advantages
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13. SPECIALIZATI
ON WITHIN
SALES
ORGANIZATIO
N
• Needed to increase effectiveness of sales force
• Done by expanding basic sales organization
• Basis of specialization
• Geography
• Type of product
• Market
• Combination of above
• Criteria for selection – (1) nature of product, (2) sales force
abilities, (3) demands of selling job, (4) customer and
market facts.

14. GEOGRAPHIC SPECIALIZATION
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15. 15

16. PRODUCT SPECIALIZATION
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18. MARKET SPECIALIZATION
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20. COMBINATION SALES ORGANIZATION
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24. THANK YOU.