Sales planning notes

What is sales planning?

Planning is done at various stages of the sales lifecycle around the fiscal year.

All business corporations set monthly or quarterly sales targets and to achieve this, a lot of planning and execution is required. A set of steps and strategies are designed to achieve these targets and this is called Sales Planning.

In other words, Sales planning is a skill where the following steps are generally followed:

  • Current situation of the company is evaluated

Knowing what is your present position is predominant for making plans for the future.

  • The market conditions are studied

The market is ever-changing. So orienting your sales plan accordingly is required.

  • New revised targets are defined

Short term planning is necessary for this step and most companies miss this.

  • Strategies required to achieve the targets are determined

When new targets are set, making changes to the task plan subsequently needed.

  • Finally, resource allocation for the same is done.

Issuing the required time, money, people for the new target accomplishment is to be undertaken.


Why is Sales Planning required?

Sales Planning is a key function in the procedure of sales management process. Sales planning is an effective method that involves sales forecasting, demand management, setting profit-based sales targets, and the written execution steps of a sales plan.

Sales Planning is the process of organizing activities that are mandatory to achieve business goals. A sales plan contains a strategic document that figures out your business targets and several resources. These can be used for some activities which you perform to reach your desired goal.

Sales Planning involves two steps, i.e. formation and maintenance of a particular plan, in which a salesperson is expected to use his conceptual skills to meet his objective. As such, planning is an elementary quality of intelligent behaviour.

Before launching a new product in the market and proceeding with the set of activities, which generally follow the launch of a product, we have to create a strategic plan for that. Sales Planning is an essential element in the management process.

Various Sales Plan techniques are often used in several organizations according to their requirements, whether they need to plan quarterly, half yearly or annually. If your sales staff is good, then you would not need to do research from the beginning to get more sales in the market.


The Nature and Importance of Sales Planning

Planning means deciding what to do in the future.

It involves setting Objectives and determining ways to achieve them.

Sales planning involves anticipating environmental developments and preparing to meet these developments or capitalize on them.

Environmental forces can act as threat or opportunity for a company’s sales n marketing activities.

Sales planning is important to every member of sales organization.

It provides the direction n framework for sales activities.

It helps sales personnel understand where the organization is headed, how is it expected to go there, and what specific actions are to be taken, by whom and when.


The importance of sales planning

  1. Better implementation of corporate plans
  2. Provide a sense of direction
  3. Focus on realistic objectives
  4. Improve coordination
  5. Facilitate control
  6. Ensure healthy interpersonal relationships
  7. Reduce uncertainty and risk


The sales planning process

  1. Setting objectives
  2. Internal situation analysis
  3. External environment audit
  4. Determining operations to meet objectives
  5. Build, Hold, Harvest, Divest
  6. Organizing for action
  7. Implementing
  8. Developing strategies
  9. Coaching
  10. Measuring results against standards
  11. Revaluating & control



A thorough sales and marketing strategy can include plans for messaging, building brand awareness and advertising tactics. The plan should define the frequency and length of time the company will utilize the various advertising channels and platforms available. Depending on demographics, one consumer group may respond better to a specific advertising platform, such as social media advertising, and others may prefer traditional advertising messages. The plan helps the marketing team target the specific consumer groups with the advertising methods those consumers prefer. Sales and marketing plans should provide qualitative and quantitative methods by which a business can measure success of the marketing campaigns.


Characteristics of effective sales planning

A good sales plan establishes goals, priorities, timetables, and necessary resources.

A sales plan that will achieve your ends has these characteristics:

  1. Sets measurable, specific, vivid, and motivating goals. Where do you intend to be in one year? What measures will you use to gauge your achievements: Number of buyers contacted? Percentage of sales to certain types of customers? Sales volume? Profit? Ranking among your peers?
  2. Identifies the enabling objectives necessary to achieve ultimate goals. What objectives must you reach on the way to the intended outcome? What new work habits must you develop? What values will you need to embrace?
  3. Outlines a logical order among the intermediate steps. What is the logical sequence for achieving your ultimate goal? What must happen first, second, third, and so on?
  4. Establishes a reasonable yet challenging time line. When will you achieve your ultimate goal? When will you jump the intermediate hurdles?
  5. Pinpoints the barriers between you and your objectives. Why haven’t you been achieving your objectives? What are the constraining forces, either in you or in the environment? What has stood in the way?
  6. Specifies strategies, procedures, and tactics. What actions will overcome the barriers that have kept you from achieving your objectives?
  7. Summarizes the resources needed. What money, materials, supplies, equipment, facilities, information, education, training, support, counsel, or staffing do you require?
  8. Establishes accountability. What will you do to hold your feet to the fire?
  9. Is in writing. Plans not written are dreams. Plans written become vows. Don’t just dream about success, vow to succeed.
  10. Is shared and negotiated with those responsible for implementing it. The more people who see your plan, the more pressure you’ll feel to make it happen.
  11. Signifies commitment. Start your plan only once you become totally confident in it and fully committed to it.


Sales planning process

1) Setting Sales Process objectives

Your sales planning is going to start only when you have defined the objectives for the sales team. For example – The objective of an air conditioning company might be to increase the market share of the company. For this, it will have to penetrate a new geographic market. Thus the objective of sales planning is to penetrate a new market to increase market share.

2) Determine the actions necessary

Once you know the objectives of your sales plan, you have to forecast what actions you need to take and the operations which are needed in effect before you implement the sales planning. This is a crucial step in the sales plan process because if you do not forecast the correct operations strategy, then in future you will face operational difficulties which will hamper you in meeting your sales objectives and plan.

For example – The air conditioning company needs to penetrate a new geographic territory to increase market share. Thus it needs Sales as well as service operation backup in this territory. The marketing department should also know the new territory so that they can come up with aggressive marketing tactics to target that territory.

3) Organize your actions

Coming back to the first point – haphazard actions will never bring results. Once you know the operations that are necessary, you need to organize your sale planning. For example – The first priority of the air conditioning company in new territory will be to have a service setup. Than to have a sales plan with setup and the necessary channel in place. Once that happens, they will have to bombard the new territory with aggressive marketing tactics. Thus an organized action plan needs to be made during the sale planning process.

4) Implement the Plan

Once you have your actions planned and organized, implementing them is the next step. Although it may sound easy, there are many real time and real world problems you may face while implementing a sales plan. For example – The customers of the new territory might not respond to the new air conditioners entering the market. On the other hand, the product might be picked up readily by the customers and you might not be able to adapt with the unexpected demand which can make your brand lose face from the start.

5) Measure results from your sales plan

As in any planning process, the fifth and very important step in the sales planning process is to measure the results. Unlike advertising, sales results are very easy to measure because everything is documented and recorded. For example – the air conditioning company will measure the total sales plan of the geographic territory in study. At the same time it will find out the competitors sales as well for record keeping.

6) Revaluate Plan

When you have the sales records in hand, ensure that you analyse the sales records to know whether or not the sales planning process has succeeded. The analysis will tell you what you did right and what went wrong. Thus, based on the analysis you can know the good work that has to be repeated as well as the bad work which has to be avoided.

For example – Your sales report shows that you have succeeded in penetrating the new geographic territory. This stage will help you set your objectives for the next year and you will plan increasing your brand equity through quality of sales and service. If on the other hand, you have failed to penetrate the market, then you need to study the reasons which caused the failure and in the next year, sales planning should be done taking these negative results into account and the sales objectives should be re planned.

Remember that sales is a dynamic process and your competitors are themselves watching you all the time. In the above example, the air conditioning segment is one of the vigorously growing segments across the world and it comes with its own share of challenges. Thus your sales planning will go a long way in implementing your organizations visions as well as in implementing the strategic marketing plan.


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