Aug 4, 2016


Sales organization is part of business organization which is mainly concerned with the effective and efficient co ordination and integration of different selling and marketing activities to make ultimate benefits to the organization. It is responsible for setting up an economical administration, for allocating authority, for fixing responsibility and for securing co ordination and integration of the activities to promote sales.

Therefore the aim of the sales organization is not only to sell to distributors but see that the goods move from the company to end users or customers on satisfactory terms. It should carefully watch the distribution of the goods and strive to put them in the hands of the customers. In order to achieve these tasks or objectives, proper and well planning and organizations of the different functions of the department will have to be undertaken.

For the purpose of putting the goods or products on the hands of the customers, the manufacturer can sell his goods to customers either directly or indirectly through the distributor. In any case he requires selling department which is entrusted with the selling and marketing functions. The salesperson employed in the sales department must operate efficiently because the success of the company depends upon the successful working of this department. Therefore they should perform their functions efficiently, effectively and economically.

That is why it is said that ‘Sales are the life oxygen of businesses.' If the business is a small scale, the proprietor can sell directly to the customers, or he may sometime take the help of one or two assistants. In such cases, the need for a sales organization is not much. But if the business is on large scale, and the market to be covered is wide, then individual proprietor cannot perform all the selling activities alone. He requires several sales persons to assist him. The larger the size of the business, the more complex will be the sales organization which consists of large number of salesperson, Sales Managers, General Managers and National Sales Managers etc.

Now a day’s goods are produced on a large scale in anticipation of demand. These goods have to be sold in an increasingly competitive market. Therefore a separate department various selling and marketing activities become quite essential especially for a growing business concern. Sometimes some big business concern prefers to entrust the work of their marketing their products to specialized dealer, distributors, Agents etc. The need for a separate department arises on account of the following factors.

The company has to create demands for its products through its sales team with the support of other main departments of the organization.

The company has to undertake wide advertising campaign and sales promotional activities, seminars in order to inform the customers about the availability of the products, about its quality, reliability, durability and life of the products etc.

Company should make necessary arrangements for the prompt execution of the order received from its customers in order to keep up the word.

Company has to attend to the complaints or grievances of its customers and resolve the issues quickly to maintain good relation and business on long term. This is the most important factor for a sales team as it has to be solved by them only. The contribution of sales team is more in resolving the problem as he is directly concerned to the customer and company.

Therefore, a modern business concern requires a separate selling organization in order to distribute effectively the products and promote the sale so as to put the products at customer door steps.

Therefore, now a day’s customer’s satisfaction survey is being conducted by different companies in order to improve the structure of the company as a whole. Thus, such companies are focusing more on its end users, to get their prompt, open and frank feedback on the products, service, quality, reliability, design etc periodically. Here the role of a salesperson is very important and essential requirement for the organization.


Sales organization of every business concern has the same functions to perform irrespective of the nature of the business of the concern. Because, the aim of every business concern is the same that is to maximum profits by making maximum sales. But the type of sales organization actually depends upon the nature of the business of the company, the product handled method of selling adopted by the company etc. For instance, the type of sales organization required for a firm dealing in manufactured consumer goods will have to be different from that required for a firm dealing in agricultural goods. Similarly, the type of sales organization required for a company producing industrial goods will have to be different from that required for a company producing consumer goods. The method of marketing goods however plays an important part in determining the type of sales organization of business concern. They are mainly two types of sales organization:




In this case the company performs all the marketing function by eliminating the middle men. The company directly comes in contact with the customer for industrial users through its own sales force. Therefore, the sales organization of such a company will have to be elaborate. The sales manager or any concerned person of the sales organization act as administrative cum operating sales manager. He is entirely responsible to the management of the company. In order to carry on his activities efficiently, effectively, economically, and successfully he divides the sales organization in to several sub departments, allots work to each sub department on the principle of division of labor and thus, fixes the responsibility on each sub department. In addition to those sub departments, he may have under him divisional managers, district mangers and regional managers. The managers keep direct contact with the customers through their sales people. These managers along with their sales people directly sell goods to the consumers and work under the direct supervision of the sales manager.


Under this plan, the company sells its goods through the various types of middlemen. The sales manager is free to make use of any group of middlemen and adopt any challenge of distribution convenient to the business of the company. Therefore, depending upon the groups of middlemen used and the channel of distribution selected, the sales organization varies from company to company. The terms and conditions according to which the company deals with the middlemen also determine the nature of the sales organization.

When sales are affected through the middlemen, the sales person of the company do not come in direct contact with the customer or industrial users, but they deal directly with the middlemen such as Distributors, dealers, retailers etc. therefore, the success of the sales organization depends upon the interest and initiative taken by these middle men in pushing up the sales.

Therefore, the sales manager of such a company selling goods through the various middlemen has to undertake a big responsibility of selecting the excellent middlemen who are ultimately responsible of increasing the sales of the products of the company. Such middlemen must be excellent, financially sound; result oriented and has good reputation with customers. The company bifurcates the customers to its middlemen according to the geographical needs. Sometimes, company may allocate key potential customers to the one middleman who has had good relationships with those customers and also he must be capable of bringing good business. This usually occurs at situations where there is more than one middleman in a particular geographical area or a region. Whereas, in some cases the company may appoint more than one middleman where the sales network is scattered over a wide range and as also one salesperson is not in a position of handling more middleman at a time. Hence, company will appoint more number of sales persons according to the needs.