1. Why do companies spend money on personal selling when there are so many less expensive alternatives?
- Benjamin Chapman worked his way through college by working as a sales representative for Best Buy. He has done well on the job and is one of the top salespeople in his department. Last week Pfizer, the pharmaceutical drug manufacturer, offered him a job selling to Doctor’s offices. Explain the differences between selling in a consumer electronics store and the pharmaceutical sales job.
- For centuries the guideline for business transactions was the Latin term “caveat emptor” (let the buyer beware). This principle suggests that the seller is not responsible for the buyer’s welfare. Is this principle still appropriate in modern business transactions? Why or why not?
- Read the following situations and answer the questions that follow.
You own a cement company, and deal with most the local contractors for cement, sand, etc. You have a reputation of high quality products, and for good customer service with your customers. Your foreman has just run the standard quality control tests you have performed regularly on your products.
When the test results are ready, you discover that the new batch of product is 9% less durable than your usual material. It is still well above all industry standards and meets all building codes and requirements for the purposes for which it is intended, but it is, nevertheless, not up to your usual standards. Throwing it away would cost your company many thousands of dollars.
You decide to sell the cement anyway.
- Should you tell your customers?
- Should you discount the price?
- Should you tell your employees, so they will be knowledgeable with the customers?
- Would you use this cement on foundation for your own house?
Joe Raymond’s position as sales manager for Granite Rock and Sand was in jeopardy. His unit had been low performer in terms of sales for the last seven quarters. Joe’s supervisor, VP Tom Haws, told Joe that he had through the next quarter to pull his unit out of last place. Haws also told Joe that Joe would have to be replaced if the improvement did not occur.
Joe and his wife had just purchased their first home. With their mortgage payments totaling $1,200 per month, the loss of Joe’s salary would mean the loss of their home.
Following Tom’s warning, Joe began interviewing candidates for a vacant sales position in his unit. Joe had conducted three interviews when the final candidate, Jessica Morris, arrived. During the interview with Morris, Joe learned that she was the victim of a layoff by a competitor, Silt, Sand and Such. Joe was not terribly impressed with Morris, but just before she left, she opened her briefcase and offered Joe a sheet of paper bearing the name of an official in the Saudi Arabian government. Morris explained:
“When I was with Silt, Sand and Such, we started a program for finding innovative markets for our products. You know, we wanted to tap markets no one had ever thought of. After a lot of research, we discovered that Saudi desalinization plants need a particular type of sand they don’t have over there, but we have here. We’re the only firm that knows about this. If you hire me, I can see the sale through for Granite”.
Morris added: “Look, I need this job. You need your sales up. Think about it and call me.”
After Morris left, Joe sat in his office and felt his problems were solved. Or were they?
- What are the pros and cons of hiring Jessica?
- What should Joe do?
- What is supply chain management and what is a salesperson’s role in supply chain management?