Sales Sales Organization Structure Salesforce Deployment de Chapter Four AKING SALES MANAGEMENT DECISIONS CASE 4.1 INNOVATIVE PACKAGING, INC. Background Insative Packaging. Inc. (IM p daging, Inc. (IP) is a national man of a wide variety of polyethylene and e packaging products, including food h us Styrofoam egg cartons, meat trays, food service product laundry and dry-clean. cing trash bags, and construction film last shipping pallets. IP is a strong com- in all of its product lines. Not an innovative IP! leverages its large manufacturing cacy to drive its costs down, which allows the y to sell its products at highly attractive Current Situation Jackie Settles, Western Region marketing manager, has called her for sales managers and four product managers to San Francisco to discuss alternative approaches to organizing the salesforce. Thirty days earlier, Settles and her managers had hosted a key customer roundtable at the annual meeting of the Plastics Packaging Manufacturers Association. Settles was troubled by several themes that emerged from the roundtable. Some of the most influential paper and plastic distributors are disturbed by the fact that IP sells to grocery chains, garment manufacturers, 8 packers/pro- cessors, and uniform rental companies on a direct basis. This is puzzling to Settles, since IP has always sold through distributors when feasible. Further distributors are informed before stocking IP prod- ucts that if end users meet certain sales volume requirements and request that they be sold on a direct basis, IPI will sell direct rather than risk losing the business. Settles is also concerned that many of the grocery chain buyers and paper and plastic distrib. utors complained about the amount of time it takes for them to see several IPL salespeople. These customers wanted to deal with a single IP prices IP! operates five regional offices Charlotte, Boston, Minneapolis, Denver, and San Francisco These offices are located at manufacturing plants that serve cach region. IPI is organized by product line, with each product line run by a regional product manager and a regional sales manager Eight to 10 sales representatives report to each of the fue regional sales managers. The product managers and sales managers in each region report to a regional marketing manager. The key products and customers for each product line are shown in EthiNE 4.10. PPI Product Lines and Key Customer Types EXHIBIT 4.10 Product Line Food Packaging Key Products Produce bags Foam meat trays Trash bags Key Customer Types Grocery chains Food coops Paper and plastic distributors Grocery chains Meat and poultry processors Food coops Paper and plastic distributors Paper and plastic distributors Restaurant wholesalers Janitorial wholesalers Restaurant wholesalers Grocery store delis Institutional food wholesalers Paper and plastic distributors Grocery chains Egg packers/processors Laundries and dry cleaners Uniform rental companies Garment manufacturers Paper and plastic distributors Food service (plastic plates, bowls) Agricultural Egg cartons Gument Poly bags representative, not one from each product line. An additional concern was that IPI did not allow aggregation of products across product lines to make it easier for these buyers to achieve the maximum quantity discounts. To prepare for the meeting, Jackie Settles asked each product manager/sales manager team to come ready to discuss these issues: 1. Is it time for IPI to reconsider its salesforce orga- nization by product line? 2. What are the advantages and disadvantages of organizing the IPI salesforce by product line? 3. What are the advantages and disadvantages of developing a new sales organization for the Western Region that would organize accord- ing to these customer types: (a) grocery chains and food coops; (b) distributors, including paper and plastic distributors, restaurant wholesalers, institutional food wholesalers, and janitorial wholesalers; and (c) end users, including meat and poultry processors, grocery store delis, egg packers/processors, laundries and dry cleaners, uniform rental companies, and garment manufacturers? Assume you are the sales manager for the food packaging product line. Address the preceding ques- tions as if you will attend the upcoming meeting. In addition, outline your thoughts on other alternatives for organizing the salesforce. CASE 4. COMPA Backgrc Applegate company nesses wi aren't com focuses employees firms, and resentative politan ma Darnell dent, was company time servis Johnson Johnson 1 him to go contact wit was hired much the experienced turned over also was in already doi Burton and Darnell Sm Darnell Sm percent. The between Bur are paid a ! clients. Role Play