Question 1

Commission plus bonus plan is usually applied to group efforts, in which some salespeople call on central buyers or buying committees while others call on store managers.

Accepted Answer

The commission plus bonus plan is often used in team-based sales environments where multiple salespeople contribute to the sales process, allowing for shared incentives.

Question 2

Salary plus bonus is appropriate for seasonal sales, when there are frequent inventory imbalances and when management wants to focus on certain products or customers.

Accepted Answer

The answer of Salary plus bonus is appropriate for seasonal...

Question 3

Managers are recognizing that high levels of customer satisfaction and retention are critical to profitability, thus many firms have incorporated customer satisfaction-based incentives (CSBI) into their sales compensation plans.

Accepted Answer

Managers understand that satisfied and loyal customers are more likely to contribute to a company's profitability, so they often use CSBI to motivate sales teams to prioritize customer satisfaction.

Question 4

Key account salespeople or customer sales teams who call on the largest and most profitable customers are often the highest-paid salespeople in their companies.

Accepted Answer

Key account salespeople handle the most significant clients, whose business is crucial to the company's success, justifying higher compensation due to their impact on revenue and customer retention.

Question 5

Although there are wide cultural differences throughout the world, compensation practices are similar as money is equally important to people all over the world. Thus, U.S. companies do not need to carefully assess each country's culture before tailoring a sales compensation plan for that market.

Accepted Answer

Cultural differences can significantly impact compensation preferences and expectations, so U.S. companies need to consider these factors when designing sales compensation plans for different markets.

Question 6

Flexibility, equitability, legitimacy, simplicity, and affordability of administration are the building blocks of any well-designed expense plan.

Accepted Answer

These principles are essential for creating an effective expense plan that is fair, easy to understand, and manageable for all parties involved.

Question 7

Limited reimbursement expense plans tend to make forecasts of selling costs more difficult as sales managers are not able to predict and budget expenses more accurately, reduce expense account padding, and establish unequivocal guidelines for spending by salespeople.

Accepted Answer

The answer of Limited reimbursement expense plans tend to make...

Quiz 12: Sales Force Compensation