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Three Problems faced by Sales Managers: Design compensation plans

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The following are three problems often faced by sales managers:

1. Salespeople tend to overemphasize the easy-to-sell products in order to build sales volume. The other, more profitable lines are forced into the background.

2. Salespeople are not taking time to develop new accounts.

3. To improve a company's long-term position, salespeople should be doing more missionary work and developing long-term customers to meet expected competition.

Come up with a specific type of compensation plan that may be used to solve each of these problems. Design three separate compensation plans (one for each of the problems listed above). You only need to provide a general overview of the compensation plan you created.

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Solution Summary

This 1100 word solution outlines a separate compensation plan to address each of the given sales-force problems.

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See the attached file.

I have created possible responses to your questions. They are on the attached PDF file. I had an extensive background in sales force management for almost ten years. These were some of the things we used to motivate sales people to service existing clients, ask for referrals to generate new clients and to sell the products we were trying to move. We did not "discourage" the sale of the cheaper products, because "any" sale is still money in the bank for both the sale person and the company. But we wanted the emphasis on the high profitability products, not the "easy to sell - in and out" products.

Sales Management Questions on Developing A Motivated Sales Force
The following are three problems often faced by sales managers:
1. Salespeople tend to overemphasize ...

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