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Allocation of Indirect Marketing Costs

1. If a company made a territorial volume analysis and found some subpar territories, how might these facts affect the following activities relating to salespeople?
a) supervision
b) compensation
c) training

2. What supporting points could be made over allocation of indirect marketing costs, by the proponents of each side, in the full-cost versus contribution-margin controversy ? Which of the two concepts do you advocate, and why? 200 word

Solution Preview

1. Many issues, including supervision, compensation, and training, can affect sales volume. Lack of supervision is one factor that affects sales, causing sales people to be unaware of targets, have inadequate training, or lack of focus. Good supervision is key in helping sales people meet their targets by helping sales staff to focus on the right accounts, right pitch, and to ensure that sales people are properly motivated. Good management also inspires sales people by showing them effective sales techniques, and leading from the front. Compensation can affect sales volume, since it is a motivating factor. Sales people that are paid through ...

Solution Summary

This solution answers how a company might make changes based on territorial volume analysis on sales people, and discusses the supporting points that could be made over allocating indirect marketing costs in full cost versus contribution margin controversy.