A performance goal assigned for a specific period of time to a marketing unit such as a salesperson or a branch office is:
A sales quota.
Activity quotas are most likely to be used in which situations:
The sales reps take no direct orders.
An activity quota will probably be used when management wants to:
Enter and develop a new market
A drawback to basing sales quotas on last year's sales is that this method:
Generally ignores current changes in a territory's sales potential.
An unlimited-payment plan for controlling sales force expenses:
Allows for cost differentials due to variations in territories or jobs.
Which of the following statements is true?
The sales manager should involve the sales force in the development of sales quotas.
Over-supervising a sales force is likely to:
Be resented by many sales reps.
Which of the following behaviors is a transformational leader behavior?
Role modeling.
An example of unethical behavior is:
Expense account abuse.
An example of a transactional leader behavior is:
Clarifying company rules.
As a supervisory tool, reports from the sales force:
Are useful in helping to evaluate a sales representative's performance.
If a manager wants to motivate experienced salespeople to perform at higher levels or to do certain aspects of their jobs better, the best leadership behavior or style to use is:
articulate a vision.
A well-designed plan for paying salespeople's expenses should:
Allow a representative to earn the same net income whether on a business trip or at home after work each day.
In which of the following situations will the salesperson most likely be on an unlimited expense-payment plan?
A manufacturer of industrial valves who is opening a new territory in the southwest.
To assist in the evaluation of the productivity of salespeople, management can use:
Sales quota plan.
A company will most likely own the cars used by the salespeople when:
The firm has its own truck fleet with appropriate maintenance facilities.
A producer of industrial valves and gauges has a sales force of 40 people who use their own cars to cover territories of various sizes in the western half of the United States. To reimburse these people for the use of their cars, the plan most equitable t
Flexible allowance such as the Runzheimer Plan
When sales-volume quotas are based on territorial potentials:
Sometimes quotas based on territorial potentials have to be adjusted downward because a new rep is covering that district.
The most widely used type of sales quota is one based on:
Sales volume.
Corporate policies which would discourage sexual harassment include:
Statements about behavior which are prohibited. Penalties for misconduct. Procedures for making, investigating, and resolving complaints. Procedures for education and training. All of these.
Genuinely caring about each individual subordinate is an example or type of:
Transformational leadership.
All of the following are transformational leader behaviors except:
Informing basic rules.
All reps of a given sales force having high job satisfaction is:
Necessary but not sufficient for high group morale.
When a joint sales call is made, the sales manager is looking to evaluate the sales rep's ability to:
Know and understand their customer's businesses and their needs. Respect their customer's time. Treat customers in a consistent and equitable manner. Gain commitment. All of these.
Situational leadership involves which of the following leader behaviors?
Informing basic rules. verbal feedback. articulating a vision. individualized support. All of these.
Illicit drug use among salespeople is:
A pervasive and costly problem.
Which of the following is sufficient for high group morale among salespeople?
All reps believe in and are striving to achieve the same goal.
Charisma is something most commonly associated with:
Transformational leadership.
Today most firms are willing to pay for:
Laptops, Home photocopiers, Car Phones, Home fax machines. All of these
Which of the following expenses is least likely to be reimbursed by the company?
Fuel costs for personal use of company car.
Which of the following factors is likely to have the least influence on who owns the cars used by the sales force?
Whether the reps are on a limited or unlimited expense plan.
An example of a citizenship behavior exhibited by a salesperson:
Being courteous and respectful of the rights of others. Never missing a meeting. Having a positive attitude, and never complaining about a problem. Volunteering to serve on a community service committee. All of these.
Which of the following is least likely to serve as a supervisory tool or method.
Sales forecasts.
When problems are encountered with subordinates, it is critical that communication is established between the sales manager and sales rep. Effective feedback should include all but:
The dismissal of any and all extenuating circumstances.
The best method for a manager to use when dealing with a situation of substance abuse within a sales rep is:
Refer the sales rep to professional counseling.
Personal characteristics associated with excellent leadership include all of the following, except:
Older age (50 years, plus)
What the textbook referred to as "indirect supervisory aids" includes:
Sales Quotas. The expense account plan. Only two of A-B-C.
As more salespeople use virtual offices:
Supervisors will spend more time in the field with their reps.
Which of the following ordinarily is the least controversial sales force travel and business expense, from the company's standpoint?
Rental cars for calls on out of town customers
Which of the following is an advantage of a limited payment plan for controlling sales force expenses?
Management can budget its sales expenses more accurately
Management's decision regarding which type of expense plan to use is least likely to be affected by:
The sales forecast for the coming year
A manufacturer has 20 sales representatives using their own cars to cover territories of various sizes in the eastern half of the United States. To reimburse these people for the use of their cars, the plan most equitable to both management and the sales
Flexible allowance per month
An unlimited payment plan for sales reps expenses
Makes it difficult for management to accurately forecast travel and business expenses of sales reps
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Transactional leader behavior is:
Clarifying company rules
The following actions are available to managers or supervisors in the case of third party harassment except for:
Do nothing
Sales managers in a behavior-based control system are expected to actively engage in:
All of these (transactional, transformational, situational)
With respect to sales reps' expenses, the federal income tax law:
Requires some substantiation of each expense which is claimed as a deduction
One feature of a plan whereby the salespeople pay their own expenses is that:
The plan is relatively simple and economical to administer
All of the following are characteristics of a good quota plan, except for:
It should have unlimited flexibility
Elements of a good quota plan include
Realistically attainable. Easy to understand. Fair. Based on objective market research. All of these
A company is likely to use a sales volume quota when management wants:
To correct an unbalanced inventory situation by pushing sales of one item
A limited-payment plan for reimbursing the salespeople's expenses is likely to be used when:
A hardware wholesaler has reps regularly calling on hardware stores in the southeast
Transformational leader do not merely bark orders- they lead by example. This is best represented by
Role modeling
A good business relationship exemplifies the leader's appropriate use of:
Interpersonal skills
A sales manager must use a combination of tools and techniques to be an effective leader. These include:
All of these (sales reports, personal contact, fax messages, sales meetings)
Ultimately, the measure of good leadership is:
How the manager behaves
For sales forecasting, the sales force composite method has the merit of:
Placing responsibility on those who will have to meet the target.
Forecasting sales is an iterative process involving the sales forecast and:
Marketing expenditures.
Which of the following is a function of the budget?
To control expense/revenue ratio.
Regarding the budgeting process for the entire firm:
None of these is correct.
Which of the following statements is true?
Garment makers tend to use shorter budget periods than auto manufacturers.
Which sales forecast is correct based on the regression model described below if the company decides to spend $10,000 on advertising (y = 70.5 + 3.0x) where: y = unit sales in thousands. x = dollars spent on advertising on thousands). What are forecasted
100.5 units.
To say that "the market potential for snow skis in Colorado and Utah is 200,000 pairs" is not a correct way of stating market potential because:
The time period for these sales is not stated
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An annual (rather than quarterly) budget period is most likely to be used in a company that:
Wants to minimize the time and detail that goes into the budgeting process.
The sales budget, in contrast to other budgets in the sales department, is most likely to include items for:
Dollar and unit revenue anticipated from each product.
If a rep works eight hours per day and the average length of a call is 30 minutes and the average travel time is 30 minutes and the rep works 250 days per year, then what is the total annual number of calls the rep can make?
2,000.
With respect to revising sales territories:
If territorial revision has been done properly, a sales rep in a now-smaller district may end up with higher sales and earnings than before the redistricting.
All of the following are reasons for establishing sales territories, except:
It reduces the number of salespeople needed.
Which of the following data types is most commonly used as a GIS input?
Aerial photographs.
The managerial activity that establishes a formal pattern for sales reps as they go through their territories is called:
Routing.
Regarding the drawing of territorial boundary lines:
A good generalization to follow is this: Do not split one of your basic control units.
Overlapping territories:
tend to be a result of management's trying to avoid friction.
The controlling factor in all budgeting and operational planning in a company is the:
Sales forecast.
Which of the following statements are correct about test marketing?
Test marketing involves observing sales results in one market and using the results to forecast sales in other markets or the whole market.
Regarding a strategic sales forecast:
It should be done within the broader context of strategic marketing planning.
Wayne Rexburg is asked which of the models - moving average models, exponential smoothing models, and regression analyses - is most accurate? Wayne should reply:
Depending on the data and the objectives of the forecaster, any one of the techniques may provide the most accurate sales forecasts.
An advantage of using the executive-opinion method of sales forecasting is that:
It can be done quickly and easily.
A sound principle to follow in demand forecasting is to:
Try to use more than one forecasting technique in order to check one against the other. Develop minimum and maximum estimates to get a range of possible market variation. Only two of A-B-C are correct.
The method of budgeting by percentage of sales reflects all of the following except:
Multiplying the sales forecast by exactly the same percentage for each category of expense.
Accurate sales forecasts would be difficult to obtain for which of the following products?
Virtual reality games.
As the sales potential of a given territory increases, sales performance of the sales rep assigned to that territory will generally:
increase for a time, but then level off.
It is recommended that sales managers review their territory structure:
Once every year.
When sophisticated computer modeling is used to design territories,
it typically involves computer technology known as GIS.
When designing sales territories the ideal goal is to:
Have all districts be equal in both sales potential and work load for the reps..
Which of the following usually is the first step in the process for establishing sales territories?
Select the basic control unit.
Call frequencies:
Involve management determining how many times per year an account should be visited. Are affected by the sales potential, the nature of the product, customer buying habits, competition, and cost of calling on a customer. Can be determined using computer m
_____________ is when a salesperson sells to a customer that is in another salesperson territory.
Claim jumping
Changes in planned marketing expenditures have an effect on which of the following:
Sales budgets and sales forecasts.
Provision for a centralized sales training department probably would be included in the:
Administrative budget.
Which of the following forecasting methods is the most widely used?
Mathematical models
In sales department budgeting, items for salesforce salaries and sales force commissions are most likely to be found in the ______ budget.
Selling expense.
First step in the budgetary process is to:
Translate the sales forecasts into work that must be done.
Which of the following statements is true?
The budget making process begins with a determination of the company's forecast for sales and resultant activities for the budget period.
Which of the following statements is wrong?
The cash budget and the profit and loss budget are the same. Everything starts with the production budget. Time lags are factored out of the budgets. All of these are wrong.
When using the breakdown method to establish sales territories, the first step ordinarily is to:
Determine the company's sales potential (that is, the total sales volume that the company can except in its full market).
For which of the following reasons are computers used in sales?
Improved accuracy of orders. Decrease in order processing time. Increased customer service capabilities. All of these.
In which of the following situations is it best for the company to have a formal sales territorial structure?
A medium-sized manufacturer of gardening tools is selling to garden nurseries throughout five Midwestern states.
All other factors being equal, a salesperson is likely to have a smaller territory if:
The rep sells directly to retailers instead of going through wholesalers.
A GIS typically includes:
Software. Hardware. Data. trained people. All of these.
Over time, sales territories:
It depends - a given territory might increase or decrease in either category.
Probably the most serious drawback to using counties as a basic control unit in territorial design is that:
For some companies (or for some counties) the county unit is still too large.
Budgeting normally is part of the ______ stage in the management process.
Planning
Which of the following activities are not necessary when reviewing a company's forecasting process?
All of these ARE necessary (review of factors influencing sales to enhance accuracy, check of accuracy of past forecasts, reviews of data being used, check of the resources allocated by the company)
The tool which an administrator uses to plan for profits by anticipating revenues and expenses is a:
Budget
Which of the following is true about sales forecasts?
The sales forecasting process should be kept as simple as possible
Scanner technology has:
Scanner technology has enabled retailers to provide their suppliers with useful sales data
One major step in the "buildup" method of designing sales districts is to establish a set of territories based on statistical measures. This step is least likely to include a determination of the:
Sales forecast
Regarding the use of a state as a control unit when establishing territorial boundaries:
This system is simple, inexpensive, and convenient to establish
When using the buildup method to establish sales territories, the first step ordinarily is to determine:
The call frequency per account per year
A sales territory is a geographical area. But the key words in the definition or concept of a sales territory are:
Present and potential customers
Which of the following is the best definition of a budget in sales force management?
A financial plan which details the expected revenues and expenditures from sales force operations
The market potential for a product may best be defined as:
The expected total industry sales of the product in a given market during a stated period of time
Which of the following statement is correct?
Errors in the sales budget affect both the revenue and expense sides of the firm
The share of total lawnmower sales which Sears, Roebuck should get next year in the South Atlantic census region is that company's ______ for the product.
Sales potential
A firm with a small sales force is selling expensive textile machinery to large textile mills. This seller is most likely to use the ______ method of sales forecasting.
Sales force composite
A sales rep will most likely have a larger territory if that person:
Is selling to wholesalers rather than direct to retailers
In which of the following jobs will management most likely plan the routing for the sales force?
Driver sales reps for a beer distribution
A county or group of contiguous counties with a combined population of 100,000, with a general urban area over 50,000, and with mainly nonagricultural employment is best described as a:
Metropolitan statistical area
Surveys of buyer's intentions:
Are based on info obtained directly from product users, whose later buying decisions will actually determine the sales
A sales forecasting period of less than one year is usually imperative for a producer of:
Fashion clothing for teenagers
As far as the length of a budget period is concerned:
Quarterly budgets usually provide for more flexibility than do annual budgets
A budget
Is simply a management tool
When done correctly, routing should
Reduce travel expenses
All of the following, except for ______, are commonly used as control units for territorial boundaries:
Sales potentials ( metropolitan stat areas, states, postal zipcodes, counties all are)
Once territories are established, sales managers should:
Revise them regularly as co and markets change
Which of the following changes is apt to decrease the geographical size of a territory?
Cover an are more intensively with increased call frequencies, ect. In order to meet comp. More effectively
Select the correct statement.
Both A and B. The buildup method equalizes the workload of salespeople. The breakdown method equalizes the sales potential in territories
Which of the following does not affect the number of calls a rep can effectively make in one day?
Whether the buildup or breakdown method is used
Regarding the relationship between marketing cost analysis and a company's accounting system:
A cost analysis is more concerned with the planning and control of the future rather than the record of the past.
When a marketing cost analysis by territories shows a net loss for a territory, which of the following is management likely to do only as a last resort?
Abandon the losing territory.
The simplest and least expensive marketing cost analysis results from an analysis of:
Ledger expenses.
One limitation of a sales volume analysis which is corrected by a marketing cost analysis is that the cost analysis:
Determines the profitability of territories or products.
To get information on quantitative input factors in a performance evaluation, management most likely will rely on:
Salespeople's reports.
Max and Marion sell for Whatisits Company. Max has by far the highest in the firm - .400. Unfortunately, his average order is the lowest - $3,000. He only saves himself by making a large number of calls per day (5) while working 275 days a year. On the ot
Max is focusing on covering many small accounts while Marion is covering relatively few large accounts.
Regarding the interpretation of quantitative data used in a performance evaluation:
A salesperson's call rate is important in evaluating performance because usually the more calls you make, the more sales you make.
Marion sells for the Whatisits Company of Whoville. An analysis of the performance of the company's 25 person sales force shows that the average sales rep works 250 days a year, makes four calls a day, obtains an order, averaging $15,000, every ten calls
3.5.
Max sells for Whatisits Company. His batting average is by far the highest in the firm - .400. Unfortunately, his average order is the lowest - $3,000. He only saves himself by making a large number of calls per day (5) while working 275 days a year. What
$1,650,000.
Regarding the use of gross margin as a basis for evaluating salespeople's performance:
This is a good basis when the company sells different products with widely varying gross margins.
In the management process, a marketing audit is most closely associated with the management function of:
Evaluation
Misdirected marketing effort occurs in many firms because:
Management often lacks reliable standards for determining what should be spent on various marketing activities.
In the management process, as applied to a marketing program, the stage which involves analyzing performance results in relation to program objectives is called:
Evaluation.
Which of the following is the best reason for continuing to carry a product when a sales-volume analysis indicates it is a low-volume item?
The item is needed to round out the company's product line.
Most of the problems in cost allocation arise in connection with ___________ costs.
Indirect.
One method to reduce the loss on small orders is to:
Educate the customers as to the costs they (the customers) are incurring by ordering in small quantities.
Suppose each salesperson is assigned to one of six separate territories in the sales region. When analyzing marketing costs by sales territory, which is not a direct cost?
Regional manager's salary.
Marion sells for the Whatisits Company of Whoville. An analysis of the performance of the company's 25 person sales force shows that the average sales rep works 250 days a year, makes four calls a day, obtains an order, averaging $15,000, every ten calls
None of these.
A quantitative input factor which can be used as a basis for performance evaluation is:
Daily call rate.
The sales manager generally reaps the largest possible gain by working with the ______________ segments of the organization.
Weakest
In the management process in a sales department:
Planning and evaluation are interdependent activities.
The management process of determining what happened, and what to do about it, is called:
Evaluation.
A territorial sales volume analysis is likely to include all of the following steps, except for:
Deduct territorial sales expenses.
ABC Company's total sales volume is $10 million, with a cost of goods sold equal to 50% of sales, and total indirect expenses of $2 million. The Eastern territory has sales volume that equals $1 million and direct expenses of $200,000. In a marketing cost
$300,000
A(n) is a detailed study of the operating expense section of a company's profit and loss statement.
Marketing cost analysis.
An argument in favor of the "full-cost" approach to cost allocation is:
Essentially, the whole purpose of a marketing cost analysis is to determine the net profitability of the marketing unit being studied.
When a marketing cost analysis by territories shows that a given territory is unprofitable, which of the following courses of action should be adopted as a last resort?
Abandon the territory entirely.
In a marketing cost analysis, ledger expenses:
Are expense categories taken from the company's regular accounting system.
In an analysis of activity costs across the Eastern, Midwestern, and Western regions of a company, personal selling expenses are:
Most likely direct expenses.
Which of the following is a purpose of evaluation?
All of these.
Marion sells for the Whatisits Company of Whoville. An analysis of the performance of the company's 25 person sales force shows that the average sales rep works 250 days a year, makes four calls a day, obtains an order, averaging $15,000, every ten calls
Work more days.
A sales rep worked 25 days last month, made 150 calls, and wrote 60 orders for a total sales volume of $200,000. Which of the following is nearest to his batting average?
.400
Regarding the sources of information used in a performance evaluation:
The company's records are the best source regarding performance output factors.
A quantitative factor which is useful for measuring output (results) in a sales rep's performance is:
Gross margin.
Max sells for Whatisits Company. His batting average is by far the highest in the firm - .400. Unfortunately, his average order is the lowest - $3,000. He only saves himself by making a large number of calls per day (5) while working 275 days a year. Whic
The size of the potential accounts in Max's territory.
Regarding the three stages of the management process (planning, implementation, evaluation), it is correct to say:
Evaluation both follows and precedes planning.
A marketing audit is:
A systematic, comprehensive review of the marketing function in an organization.
When preparing a sales volume analysis by customer classification:
This type of analysis is usually more fruitful when the customer groups are also analyzed by product line or territory.
All of the following are true about sales force automation (SFA) systems, except:
SFA is so easy that no training of salespeople is required.
A total evaluation program in marketing is best described as:
A marketing audit.
A company's return on investment is least likely to be affected by a change in that company's:
Marketing cost analysis
A territory's return on investment is influenced by that territory's:
All of these (sales volume, contribution margin, accounts receivable and inventory)
All of the following are methods used to allocate indirect costs in a marketing cost analysis, EXCEPT:
Allocate 100% of the cost to the largest territory
Which of the following leads to a greater use of adaptive selling behaviors?
An evaluation system that emphasizes sales behaviors
An accurate generalization about evaluating sales force performance is that:
Management should use as many bases as possible when appraising performance
Management controls its sales force through the:
All of these (compensation plan, quota system, territorial structure, training program)
An analysis of sales volume tells us nothing about the ______________ of each territory.
Profitability
Supporters of the contribution-margin approach to marketing cost analysis believe that:
It is not possible to accurately allocate indirect costs among products or market segments
Marion sells for the Whatisits Company of Whoville. An analysis of the performance of the company's 25 person sales force shows that the average sales rep works 250 days a year, makes four calls a day, obtains an order, averaging $15,000, every ten calls
All of these (closely examine the nature of the account in marion territory, determine what potential business she is missing in her territory, look at her call reports carefully to try to discern how many call it takes for her to sell to one of her accou
Regarding the interpretation of performance data:
None of these (placing much weight on a gross margin perf. Will encourage salespeople to do missionary selling acts, most qualitative eval. Factors can be measured objectively, customer feedback is of no use when interpreting qualitative eval. Factors, sa
The customer probability cube helps predict:
All of these (how much customers will buy, what products, when will buy, when the products will be purchased)
Regarding a sales volume analysis by territory or product line:
To make a useful analysis, management first should have set some sales goals or quotas by territory or product
Which of the following is true about salespeople and SFA?
Sfa adds value to an org. Only when reps regularly enter data
When making a sales volume analysis by product line:
It is useful if industry sales figures are available for each of our product lines
Suppose a marketing manager was conducting a marketing cost analysis. In doing so, she wanted to allocate activity costs to each of three sales offices. What would be the most appropriate approach for allocating personal selling expenses?
Selling expenses should be allocated to the sales office from which they were generated
In a marketing cost analysis, the textbook identifies three methods used to allocate indirect costs. One method is to divide indirect cost equally among territories. This method:
Is the easiest of the three methods
Marion sells for the Whatisits Company of Whoville. An analysis of the performance of the company's 25 person sales force shows that the average sales rep works 250 days a year, makes four calls a day, obtains an order, averaging $15,000, every ten calls
Wants the day off and can afford to take it
Which of the following leads to greater sales and profits?
Evaluation based on both inputs and outputs
Among the following factors, the most difficult to quantify (measure objectively) in a performance evaluation is the sales rep's:
Cooperativeness and resourcefulness
The "80-20" principle exists in many companies because:
Marketing efforts and costs follow the number of territories, products, and customers rather than actual sales or profit from these units
Which of the following best illustrates the 80-20 principle?
Sixty eight percent of our customers account for only 12 percent of our sales
When analyzing sales volume by customers groups, a useful basis for grouping customers is by:
Any or all of these (industry divisions, channels of distribution, key (national) accounts and other accounts)