Deck 16: Managing Within Your Company

Question 1

Straight commission is the preferred method of compensation when sales require long periods of negotiation involving several sales reps from the selling company.

Answer 1

False

Question 2

Kristen wants her sales force to concentrate its efforts on selling the most profitable products and on selling to most profitable accounts.To achieve this target,she can institute profit quotas.

Answer 2

True

Question 3

Rather than complain about poor marketing programs,proactive salespeople and sales managers prefer to participate in marketing decisions and keep communication lines open.

Answer 3

True

Question 4

When conflicts arise between a salesperson and an internal employee,personalizing the conflict will make it easier to resolve.

Question 5

SPIN and active listening are just as important to understanding the needs of colleagues as they are to satisfying customer needs.

Question 6

Marketing and sales should be highly coordinated because their functions are closely related.

Question 7

Internal partnerships should be dedicated to satisfying customers' needs.

Question 8

When selling internally,salespeople should use arguments that adequately address the internal customer's needs.

Question 9

The administration department of a company acts as the eyes and ears of marketing.

Question 10

Understanding the needs of the credit department and assisting it in collecting payments can better position a salesperson to help customers receive credit later.

Question 11

A sales quota is the minimum sales revenue necessary for acceptable performance.

Question 12

Few jobs require the boundary spanning coordination and management skill needed to effectively perform a sales job.

Question 13

The ability to work with groups inside the company can directly affect a sales representative's pocketbook.

Question 14

Salespeople should develop relationships with manufacturing so they can make accurate promises and guarantees to customers.

Question 15

The field sales manager is the manager at the top of the sales force hierarchy.

Question 16

The functions of order entry,billing,credit,and employee compensation require each company to have a customer service department.

Question 17

The field sales manager typically determines the types of salespeople needed in a sales force.

Question 18

Both marketing and sales are concerned with providing the right product to the customer in the most efficient and effective manner.

Question 19

Close relationships and support of customer or technical service representatives with the salesperson mean not only better customer service but faster and more direct information flow to a salesperson.

Question 20

Salespeople can help customer service by setting very high expectations for product performance with customers so that the customer service representatives receive extended service calls.

Question 21

Katherine is developing a forecast for next year's sales of organic fertilizer by her company to the nation's retail gardening nurseries.She is assembling the sales estimates for her company's products by adding together the territory estimates provided by her salespeople.She is engaging in _____ forecasting.

A) cumulative
B) geographic
C) gross margin quota
D) profit quota
E) bottom-up

Question 22

An inside salesperson who is an account manager has the same responsibilities and duties as a field salesperson,except that all business is conducted over the phone.

Question 23

Lennie's sales manager expects him to make at least 5 calls per day and give at least 15 full presentations per week.These expectations best exemplify:

A) activity quotas.
B) revenue quotas.
C) gross margin quotas.
D) sales commission rate.
E) sales quotas.

Question 24

Ethical behavior not only applies to how salespeople treat customers,but it also applies to how employers treat salespeople.

Question 25

Which of the following is a primary role of salespeople in an organization?

A) Drafting an expense budget
B) Determining the mission statement of the company
C) Correctly designing administrative organizational structure
D) Initiating succession planning in an organization
E) Carrying the customer's voice across the organization

Question 26

House accounts are handled by field sales managers in addition to their regular duties.

Question 27

_____ are more important in situations where the sales cycle is long and sales are few because what a salesperson does can be observed more frequently than sales.

A) Activity quotas
B) Revenue quotas
C) Gross margin quotas
D) Sales commission rate
E) Sales quotas

Question 28

Kelly receives a draw each week.This best exemplifies a straight salary.

Question 29

Taylor deals in roller coasters,carousels,bumper cars,and other similar rides to amusement parks.His manager has told him that he must find buyers for at least 6 water flume rides,3 carousels,2 coaster rides,and 10 kiddy rides this fiscal year.Taylor's manager has given him his:

A) key accounts.
B) sales quotas.
C) revenue quotas.
D) sales commission rates.
E) commission bases.

Question 30

Ed works as a salesperson in a garment manufacturing company.Which of the following departments in Ed's company is most directly responsible for seeing that the orders he gets from customers are properly entered into the company's computer,and that he gets his commission for the orders?

A) Marketing
B) Manufacturing
C) Administration
D) Shipping
E) Customers service

Question 31

If a salesperson is placed in a situation where he or she must act unethically or lose the job,the best way out would be to rationalize an unethical action by placing the responsibility on the sales manager.

Question 32

In an extension of team selling,multilevel selling,members at various levels of the sales organization call on their counterparts in the buying organization.

Question 33

Large customers are called key accounts.

Question 34

Straight commission plans offer the greatest flexibility for motivating and controlling the activities of salespeople.

Question 35

Mack is a salesperson.His _____ for next year is to sell $525,000 worth of merchandise in his territory.

A) sales quota
B) revenue quota
C) sales commission rate
D) budget bogey
E) commission bases

Question 36

For field sales managers,the easiest method of evaluating performance is to determine the salesperson's product knowledge.

Question 37

Salespeople typically report directly to the sales executive.

Question 38

Which of the following statements about forecasting in global markets is true?

A) The same forecasting techniques that work in the United States work around the world.
B) Salespeople are especially important to the forecasting process when the executive is attempting to forecast international sales.
C) For international marketing forecasts, the top executives rather than the salespeople can provide the most accurate numbers.
D) In the bottom-up forecasting method used in international sales, little input from the salespeople is taken.
E) Computer simulations produce the most reliable sales forecasts for selling in international marketing.

Question 39

Which of the following corporate areas is important to salespeople?

A) Marketing
B) Manufacturing
C) Administration
D) Shipping
E) All of the above

Question 40

Which of the following statements is true of the responsibilities of a salesperson in matters related to expense budget?

A) The salesperson does not have any control over whether expenditures are over or under budget.
B) Ultimately it is the salesperson's responsibility to manage the territorial budget.
C) Salespeople are primarily responsible for making the expense budget.
D) A salesperson cannot express an expense budget as a percentage of sales volume.
E) None of the above is true.

Question 41

Chris receives $520 per week gross pay in his sales job at the Lark dealership.This amount remains fixed and does not vary with the number of sales.As long as Chris works his 40 hours,he gets paid $520.Chris is paid:

A) a salary plus bonus.
B) a straight commission.
C) a salary plus commission.
D) a commission plus bonus.
E) a straight salary.

Question 42

Alkara receives $200 per week plus 10 percent of the value of all the sales she makes.In a particular week she earns $750.The 10 percent of the total revenue of $750 best exemplifies:

A) a gratuity.
B) a stipend.
C) a fixed pay.
D) incentive pay.
E) a salary.

Question 43

Arnold is a salesperson.His company's compensation plan involves paying him 14 percent of the total sales he makes per month.This 14 percent is known as the:

A) straight salary.
B) draw.
C) commission base.
D) commission rate.
E) bonus.

Question 44

For every case of fragrance that Jill sells,she earns $10.This amount is her _____.

A) commission
B) sales quota
C) salary
D) gratuity
E) activity quota

Question 45

The major advantage of the straight commission compensation approach is that it:

A) provides reduced financial incentive.
B) ties compensation directly to performance.
C) encourages employees to take up activities that do not directly lead to sales.
D) promotes company loyalty.
E) does all of the above.

Question 46

The portion of a sales rep's compensation that is based on his or her performance is called:

A) fixed pay.
B) stipend.
C) activity quota.
D) incentive pay.
E) salary.

Question 47

The _____,which determines the amount a salesperson is paid,is expressed as a percentage of the commission base.

A) activity quota
B) straight salary
C) bonus point
D) straight commission
E) commission rate

Question 48

Ed works for Lanier Business Products as a sales representative.He receives a straight commission.In weeks when his earned commission is less than $600,the company loans him enough money against future commissions to allow him to receive $600.In future weeks,when Ed earns more than $600,the extra is used for repaying the previous loan.For Ed the guaranteed $600 is his:

A) sales quota.
B) activity quota.
C) draw.
D) bonus.
E) straight salary.

Question 49

A _____ plan typically pays a certain amount per sale,and the plan includes a base and a rate but does not include a salary.

A) fixed pay
B) bonus
C) straight commission
D) straight salary
E) quota

Question 50

Which of the following is a major disadvantage associated with a combination compensation plan?

A) Its inability to be used as a motivation tool
B) Its complexity
C) Its inability to include a draw
D) Its lack of flexibility in the context of motivating salespeople
E) Its lack of flexibility in the context of controlling the activities of salespeople

Question 51

Management uses a combination plan typically when it wants to:

A) motivate and control the activities of salespeople.
B) emphasize that its sales force needs to concentrate on getting new and commissionable sales.
C) ensure that the sales force can easily understand exactly how it is being financially rewarded.
D) engage in transactional selling relationships.
E) accomplish all of the above.

Question 52

_____ is the amount of money paid to a salesperson at regular intervals regardless of his or her performance.

A) Gratuity
B) Bonus
C) Incentive
D) Commission
E) Salary

Question 53

Straight salary plans are typically used when:

A) advertising is more important to the sale than the efforts of the salesperson.
B) a team of salespeople is involved in the sale.
C) the sale requires a long period of negotiation.
D) individual results of sales team members cannot be measured.
E) any of the above situations arises.

Question 54

A(n)_____ is incentive pay for overall performance in one or more areas.

A) sales quota
B) bonus
C) salary
D) gratuity
E) activity quota

Question 55

Another name for a salary-plus-commission plan is:

A) compound plan.
B) activity quota plan.
C) straight salary plan.
D) combination plan.
E) straight commission plan.

Question 56

Money paid to a straight commission salesperson against future earnings,which guarantees a stable cash flow is called a:

A) quota.
B) salary.
C) draw.
D) bonus.
E) commission base.

Question 57

Marshall is compensated by his company under a straight commission plan.He receives 10 percent of the total sales revenue per week.In a particular week,the total sales revenue is $6,000.This amount is known as the:

A) straight salary base.
B) draw.
C) commission base.
D) commission rate.
E) bonus point.

Question 58

What is the easiest method to evaluate the performance of salespeople?

A) Measuring customer service levels
B) Measuring product knowledge
C) Measuring total sales
D) Determining how quickly management requests for information are answered
E) Measuring how aware each salesperson is about competition and business conditions

Question 59

A commission plan is likely to be used when:

A) the sales force includes many part-timers.
B) the earnings of part-time salespeople are required to be tied to their performance.
C) a company does not emphasize on service to customers.
D) a company does not anticipate long-term customer relationships.
E) any of the above situations arises.

Question 60

A salesperson who receives a fixed amount of money for working a specified time period is being compensated using the _____ method.

A) salary plus bonus
B) straight commission
C) salary plus commission
D) commission plus bonus
E) straight salary

Question 61

When a company uses a group of salespeople to support a single account,it is employing the _____ approach.

A) crew selling
B) referral opening
C) multilevel marketing
D) team selling
E) customer orientation

Question 62

GEC Inc.has one sales force that sells electric transformers and similar equipment to electric utility companies and another sales force for its line of consumer goods.These salespeople best exemplify:

A) product specialists.
B) account specialists.
C) missionary salespeople.
D) telemarketing representatives.
E) geographic salespeople.

Question 63

Which of the following is an example of an inside salesperson?

A) A salesperson who calls on farmers' cooperative groups
B) A distributor who visits a customer's home to sell cosmetics
C) A retail clerk at a local hardware store
D) A pharmaceutical salesperson who regularly calls on physicians
E) A salesperson who trains a customer's employees on how to use the new copier he just sold them

Question 64

Neal works for Integrated Computer Systems Distributors (ICSD)as a field salesperson.In his territory,he only calls on attorney's offices and physician's offices.This specialization has allowed him to develop a high level of expertise at selecting just the right combination of hardware and software to meet the unique needs of these offices.From this information,it can be concluded that Neal is part of a sales force that is organized according to:

A) account types.
B) sales volume.
C) geographic regions.
D) activity quota.
E) performance based criteria.

Question 65

Which of the following is an example of a field salesperson?

A) A retail clerk at a large department store
B) A telemarketer
C) A worker who takes food orders through a drive-through window
D) A pharmaceutical sales representative who visits doctors' offices to sell drugs
E) All of the above

Question 66

Which of the following is an example of an outbound salesperson?

A) LaVerne responds to a customer who called with a billing complaint.
B) Anet uses her telephone to solicit new business from a list of prospects.
C) Orlando calls a company's toll-free number to complain about his malfunctioning lawnmower.
D) Millie, as the CEO of her company, handles two house accounts.
E) Morris takes a telephone order for a medium pizza.

Question 67

Candace was distressed to discover her company had paid several bribes to get a major contract.When she voiced her concerns to the management,she was told to keep her mouth shut if she wanted to keep her job.After several other attempts to stop the unethical practices,Candace gave the evidence she had of the corporation paying bribes to a local television station.This action of Candace is called:

A) data mining.
B) direct denial.
C) blowing the whistle.
D) cross-selling.
E) rejecting the open-door policy.

Question 68

Troy is a telemarketer who works directly with Nadine,a sales rep who works on site.Together they develop strategies for handling accounts and address customer concerns.Troy is an example of:

A) a missionary salesperson.
B) a product specialist.
C) a field support representative.
D) an outside salesperson.
E) none of the above options.

Question 69

How does a house account differ from other types of accounts?

A) A house account is always unprofitable.
B) A house account is usually too small for attention by a salesperson.
C) No commission is paid on sales to the house account.
D) A house account is served by the firm's telemarketing center.
E) Commissions are split among all the salespeople who service the house account's various locations.

Question 70

An ethics review board:

A) discourages subordinates from taking their ethical concerns to upper management of a company.
B) typically has no effect on the ethics of an organization.
C) should not be expected to have any lasting effect on behavioral norms within the company.
D) can investigate allegations of unethical behavior and serve as a sounding board for employees.
E) should be composed solely of outside experts who are in no way financially involved with the organization.

Question 71

Neva Tire Company has divided the state of Tennessee into three territories―East,Central,and West.Salespeople are based in Knoxville,Nashville,and Memphis to cover these three territories.Based on this information,it can be said that these salespeople are:

A) temporary employees.
B) paid a straight commission.
C) paid a straight salary.
D) geographic salespeople.
E) product specialists.

Question 72

Which of the following is the area with the most employee concerns?

A) Territory allocation
B) Promotion policies
C) Quota assignments
D) Compensation
E) Recruitment policies

Question 73

Which of the following is an example of an inbound salesperson?

A) Bettina makes cold calls for her field sales representative.
B) Marjorie is a telemarketer who sells aluminum siding to key accounts.
C) Al calls to see if the Yelverton family wants to renew its subscription to the "Nashville Tennessean."
D) Burt receives a phone call from a customer in BellSouth who wants to check the availability of a particular watch.
E) Tracey sits at the customer service section and provides product information to her clients.

Question 74

When Wallace earned a commission that was greater than the salary of his company's senior vice-president,he was pleased with his accomplishments.He was not so happy when the company told him that it had a _____ and that he would receive only $50,000 in commissions,about 40 percent less than what he had earned.

A) draw
B) quota
C) base
D) cap
E) bonus

Question 75

_____ is an extension of team selling in which members at various levels of the sales organization call on their counterparts in the buying organization.

A) Network marketing
B) Viral marketing
C) Hierarchical selling
D) Direct selling
E) Multilevel selling

Question 76

To keep commissions paid to salespeople from becoming so high that they become demoralizing to company executives,some companies place upper limits on how much a sales representative can earn.This limit is called a:

A) draw.
B) bonus.
C) base.
D) cap.
E) ground rule.

Question 77

Which of the following best describes customer service reps?

A) They are outside salespeople who are not concerned with setting up long-term relationships with their customers.
B) They are salespeople who specialize by types of products.
C) They are salespeople who actually do the sales presentations for key account customers.
D) They are inbound salespeople who handle customer concerns.
E) They are telemarketers who work with field salespeople to sell goods to customers.

Question 78

Drew believes his sales manager has instructed him to do something unethical,and discusses his concerns with the manager.However,even after discussing the matter with the manager,he was asked to carry out the original instructions.Drew's company encourages him to take his concerns straight to upper management because it has a(n)_____.

A) straight salary system
B) bottom-up forecasting system
C) anti-whistleblowing policy
D) straight commission system
E) open-door policy

Question 79

Alcium Aluminum has one sales force for handling tubing and extruded products,another for handling cans and rolled products.This best exemplifies a sales force that is organized on the basis of _____.

A) activity quota
B) sales quota
C) customer types
D) geographic location
E) product specialization

Question 80

House accounts:

A) are invariably the same as key accounts.
B) have no "true" salesperson.
C) are not used by large retailers.
D) provide salespeople with a percentage-of-sales commission.
E) are typically handled by field salespeople.