 |
 |
 |
 |
|
 |
 |
requirements of the salesforce had also changed. Selling to the engineering industry
meant taking orders and making sure delivery was on time. Sales representatives called
on each of the customers weekly to ensure that they got orders in a competitive and
rapidly changing market. There was little technical information for the salesforce to provide
about a very slowly changing product range; and one that gave few problems to
customers highly experienced in their use. Currently Xenon employed four sales
representatives to service the traditional market, reporting to a sales manager. Each sales
representative received a flat rate salary and benefit package of 200,000FF per annum.
There was no commission paid as it was considered inappropriate for the market. The
sales manager's cost to the company was 300,000FF per annum.
The motor trade and railway manufacturers required detailed project proposals from
suppliers, with design layouts and specifications for all the particular and individual cutting
heads that they needed. The sales engineers would then have to supervise the
development of prototypes and establish testing programmes to ensure that the
specifications were met. At present, the company were using two of the production
engineers from the factory as technical sales representatives. Though both were
technically extremely competent, they had limited sales skills and could only handle
discussions in their native language.
Promotion
Xenon relied on its salesforce for most of its promotional activity, apart from the use of
directories and the membership of the appropriate trade organisations. Recently the
company had considered whether it should not be attending some of the more prestigious
trade exhibitions so as to improve its market presence at the sophisticated end of the
sector. Such exhibitions were extremely expensive, with estimates ranging from FF1.5
million to FF1.7 million for the entire costs of a single exhibition appearance.
Action
Have Xenon made the right decision about moving into the higher technology area?
What are the implications for the development of the organisation?
As the company is under pressure to improve the finances in order to fund the
development of the new product lines, what changes would you institute in the
management of stocks and production schedules?
 |