Breakdown Approach

Sales managers must determine the number of salespeople that are required to service existing customers and also attract new customers. To determine sales force size (SFS) using the breakdown approach, sales professionals must be aware of their previous sales history, projections of their own new sales for the upcoming year, and market forecasts. This chapter discusses the breakdown approach, which is useful for determining SFS; however, sales professionals must be cautious not to depend only on previous year's average sales per person, as a benchmark for future sales requirements. With the rise of business, companies seek to increase both efficiency and effectiveness, which includes setting up growth targets for existing salespeople. Sales management must also look at the factors contributing to the projected sales increase. Expected market growth and projected customer growth will affect the sales management's decision on the right balance between SFS requirements and projected sales growth.