Deck 16: Managing Within Your Company

Question 1

As Lillie Sanchez says in the opening profile "In sales you punch a time card and are given a to-do list daily that could consume 24 hours of your day."

Answer 1

False

Question 2

House account are handled by a sales or marketing executive in addition to their regular duties.

Answer 2

True

Question 3

It is the duty of salespeople to establish internal partnerships with warehouse and customer service employees.

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

Kelly receives a draw each week, which is her straight salary with commissions as a bonus.

Question 6

According to the text, the company's chief executive officer determines how many salespeople are needed to achieve the company's sales and customer satisfaction targets.

Question 7

Kristen wants her sales force to concentrate its efforts on selling the most profitable accounts and products, to make this happen she could institute profit quotas.

Question 8

Internal partnerships should be dedicated to satisfying customers' needs.

Question 9

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

Question 10

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

Question 11

If you are ever placed in a situation where you must act in a manner you consider unethical or lose your job, the text recommends you rationalize the action by placing the responsibility for your behavior where it belongs--on your sales manager.

Question 12

Compensation often relates to quotas.

Question 13

Velma was in a hurry to see her sales manager, so she parked her car in front of her company's loading dock and ran inside, ignoring the dock foreman's request to please move the car. In the long run her action may end up costing her money.

Question 14

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

Question 15

Large customers are sometimes called key accounts.

Question 16

Arunden Garden Supply Company is offering a bonus to the members of its sales force who call on retail outlets for the firm's gardening supplies if they spend less on expenses than is budgeted for them. This decision by the Arunden sales executive in charge may hurt sales performance.

Question 17

Oscar works for Putnam Company, a manufacturer of automated Christmas tree decorations. When he presents his customer's position about Putnam's new credit terms to the corporate comptroller he is doing part of his job as a sales representative.

Question 18

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

Question 19

What Monica tells the buyers at Forsyth Company about the performance of her company's computerized lighting system could have a direct bearing on the amount of service work her company's technicians are called upon to do.

Question 20

With the growth in worldwide communications capabilities, statistics like those used to forecast sales in the U.S. are now available in most of the world's nations.

Question 21

The ___________ is ultimately responsible for how a salesperson's expense budget is spent.

A)field sales manager
B)salesperson
C)corporate accounting department
D)corporate finance department
E)executive with overall responsibility for the sales force

Question 22

Jorge's sales manager has told him that he will be given a $100 bonus if he can reduce his expenses by 5 percent during the next quarter. Jorge sells promotional products like mugs and calendars to companies to give to customers as a part of reminder advertising. What potential effect does this bonus have on Jorge's sales for the quarter?

A)It may reduce sales because he is reluctant to give out samples.
B)It may increase sales because customers respect his cost-saving techniques.
C)It may require Jorge to eliminate product demonstrations from his presentation.
D)It may increase his sales because customers will not get to handle samples during the presentation and will pay closer attention to the presentation.
E)There is no way to predict what will happen.

Question 23

Which of the following departments of 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 paid his commission for them?

A)marketing
B)manufacturing
C)administration
D)shipping
E)sales

Question 24

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 are examples of:

A)activity quotas.
B)revenue quotas.
C)gross margin quotas.
D)unit quotas.
E)compensation quotas.

Question 25

Gwendolyn's _____ calls for her to sell 50 store fixtures next quarter.

A)profit quota
B)revenue quota
C)gross margin quota
D)sales quota
E)compensation quota

Question 26

A(n) _____ represents a quantitative minimum level of acceptable performance for a specific time period.

A)forecast
B)budget
C)quota
D)ration
E)allowance

Question 27

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 using _____ forecasting.

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

Question 28

While servicing a copier at NevaFlat Tire headquarters, R.J. overhears the office manager telling another employee that the increased level of problems with the copying machine are probably due to the unexpected increase in work it's having to do, and that he has sent a request to the corporate finance committee for money to buy a heavy-duty model. What should R.J. do?

A)Pass the information along to the copier sales rep who calls on NevaFlat.
B)Ignore what the office manager said.
C)Encourage the office manager to contact the company sales rep.
D)Offer to make only a temporary repair on the copier since it will be replaced soon and could save NevaFlat some money.
E)Not worry about how well the copier gets fixed since NevaFlat will probably be getting rid of it in a few weeks.

Question 29

Bottom-up forecasting provides the advantage of:

A)forecasting coming from people who are not responsible for achieving the sales figure forecast.
B)salespeople who tend to be optimistic and may overestimate sales.
C)allowing forecast information to come from the people closest to the market.
D)salespeople who may deliberately underestimate sales if their bonuses depend on exceeding the sales forecast.
E)All of the above are advantages of bottom-up forecasting.

Question 30

A company that sets minimum level of things salespeople must do is using:

A)activity quotas.
B)revenue quotas.
C)gross margin quotas.
D)unit quotas.
E)compensation quotas.

Question 31

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)The only reliable sales forecasting source in many countries is from the existing sales force.
C)For international marketing forecasts, top-down sales forecasting is much more reliable than bottom-up forecasting.
D)Executive opinion is most often used in forecasting international sales and does not use any input from salespeople.
E)Computer simulations produce the most reliable sales forecasts for selling in international marketing.

Question 32

Oscar sells for Rubies Costume Company. When he presents his customer's position about Rubies's new credit terms to the company's comptroller, he is doing part of his job as a:

A)sales representative.
B)accounting employee.
C)collection agency enforcement officer.
D)chief finance officer (CEO).
E)marketing communication specialist.

Question 33

A telemarketer 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 34

Most sales positions require boundary-spanning coordination and management skill. Which of the following corporate areas is important to salespeople?

A)marketing
B)manufacturing
C)administration
D)shipping
E)all of the above

Question 35

Taylor sells roller coasters, carousels, bumper cars and other similar rides found at amusement parks. His sales manager has told him that at a minimum, he must sell 6 water flume rides, 3 carousels, 2 coaster rides, and 10 kiddy rides this fiscal year. Taylor's sales manager has given him his sales:

A)disposals.
B)quotas.
C)forecasts.
D)types of compensation.
E)rations.

Question 36

Which of the following statements about building internal partnerships is FALSE?

A)How well other employees of a firm assist one of the firm's salespeople may be a function of the relationship the salesperson has previously established with those people.
B)It is the duty of warehouse and customer service employees to establish internal partnerships with salespeople.
C)A salesperson may effectively employ the SPIN technique within his or her own company.
D)Successful internal sellers can communicate their customers' sense of urgency to internal employees by relating it to the needs of the internal employee.
E)Personalizing conflict between a salesperson and an internal employee will make it more difficult to resolve.

Question 37

Which of the following is NOT a role played by the sales executive?

A)manager at the top of the sales force hierarchy
B)determines the company strategies with respect to new products
C)determines the size and organization of the sales force
D)makes decisions about how the sale force will accomplish corporate executives
E)audits manufacturing production quotas

Question 38

Ryan is part of a team that calls on their counterparts in a buying organization. He is part of a multilevel selling team.

Question 39

Which of the following is good advice for a salesperson who is selling internally?

A)Make selling issues personal, not professional.
B)Be prepared to negotiate.
C)Ignore any personal needs of the internal customer.
D)Never use any arguments to convince the internal customer he or she should support you even though the arguments may address the internal customer's needs.
E)Appeal to an objective that can be classed as the lowest common denominator.

Question 40

Mack's _____ for next year is to sell $525,000 worth of merchandise in his territory.

A)profit quota
B)revenue quota
C)gross margin quota
D)unit quota
E)compensation quota

Question 41

The two most common types of incentives given to salespeople are:

A)bonus and salary.
B)commission and salary.
C)draw and commission.
D)bonus and commission.
E)salary and fee.

Question 42

Marshall receives $175 per week plus 12 percent of the value of all sales revenues he makes over $850 per week. Sales revenue over $850 is an example of a:

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

Question 43

_____ 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)Unit quotas
E)Compensation quotas

Question 44

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 occur.

Question 45

Alkara receives $200 per week plus 10 percent of the value of all sales she makes over $750 per week. The 10 percent of sales over $750 Alkara receives is an example of:

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

Question 46

A _____ is an incentive paid for overall performance in one or more areas of performance.

A)commission
B)bonus
C)salary
D)gratuity
E)quota

Question 47

An amount of money paid to a salesperson at regular intervals regardless of his or her performance is called their:

A)gratuity.
B)donation.
C)contribution.
D)commission.
E)salary.

Question 48

When Zoe sells a case of Just Cut Christmas Tree Fragrance to one of her dealers, she receives a _____ of $5.

A)commission
B)fair trade allowance
C)salary
D)gratuity
E)quota

Question 49

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 50

Straight salary plans are used when:

A)the other elements of the promotion mix are of less important to the sale than the efforts of the salesperson.
B)the sale is completely handled by one salesperson.
C)the sale requires a long period of negotiation.
D)the selling organization does not want to establish long-term selling relationships with buying companies.
E)any of the above situations occur.

Question 51

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

A)bonus.
B)stipend.
C)contribution.
D)incentive pay.
E)salary.

Question 52

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

A)combination
B)bonus
C)straight commission
D)cause and effect
E)focus

Question 53

Arnold receives $300 per week plus 14 percent of the value of all sales he makes over $650 per week. Fourteen percent is an example of a:

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

Question 54

Chris receives $520 per week gross pay in his sales job at the Ford dealership. The amount never changes even though some weeks he sells 5 or more vehicles and in other weeks he may sell none. As long as he works his 40 hours, Chris gets his $520. Chris is paid:

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

Question 55

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

A)transition.
B)indemnity.
C)draw.
D)bonus.
E)assessment.

Question 56

A draw would most likely be given a salesperson who is asked to work under a(n):

A)straight salary plan.
B)bonus plan.
C)incentive pay plan.
D)straight commission plan.
E)an artistic plan.

Question 57

Raven receives $200 per week plus 10 percent of the value of all sales she makes over $750 per week. The $200 Raven receives is an example of a:

A)gratuity.
B)donation.
C)contribution.
D)commission.
E)salary.

Question 58

Salespeople want a compensation system that is all of the following EXCEPT:

A)understandable
B)one that bases rewards on effort and results
C)inexpensive to administer
D)equitable
E)uniform within the company

Question 59

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

A)level
B)grade
C)interval
D)force
E)rate

Question 60

Norma will receive an incentive payment of $150 if she adds 5 new customers to her account list this month. The $150 payment is an example of a:

A)commission.
B)bonus.
C)salary.
D)gratuity.
E)quota.

Question 61

Salespeople have the right to expect fair treatment from their company. In which area do salespeople believe they are most likely to not be treated fairly by their company?

A)territory allocation
B)promotion policies
C)quota assignments
D)compensation
E)recruitment policies

Question 62

Management uses a combination plan when it wants to:

A)motivate salespeople to increase revenues while continuing to perform nonselling activities.
B)emphasize that its sales force needs to concentrate on getting new and commissionable sales.
C)make sure 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 63

Drew believes his sales manager has instructed him to do something unethical, and after discussing the practice with the manager, the instructions still stand. Drew's company encourages him to take his concerns to upper management because it has a(n) _____ policy.

A)no-holds-barred
B)bottom-up
C)open-air
D)bare bones
E)open-door

Question 64

A group of experts from inside and outside the firm is employed by the Lion Ribbon Company to investigate allegations of improper behavior and act as a sounding board for employees. The term for a group like this is a(n):

A)reconsideration panel.
B)ethics review board.
C)evaluation board.
D)incentive panel.
E)summary judgment panel.

Question 65

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 he had earned.

A)buttress
B)foundation
C)base
D)cap
E)ground rule

Question 66

When ordered to sell inferior training software to the U.S. government, an ethical salesperson should:

A)do as his supervisor instructs him.
B)rationalize away the behavior by placing responsibility on the manager who gave the order.
C)try to fix the problem himself/herself.
D)refuse to comply with the request.
E)do all or any of the above because he or she is an ethical salesperson.

Question 67

An ethics review board:

A)is a completely internal tool for auditing ethical behavior within an organization.
B)typically has no real 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 68

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

A)provides reduced incentive.
B)ties compensation directly to performance.
C)encourages cooperation in preparing sales forecasts.
D)promotes company loyalty.
E)all of the above

Question 69

Which of the following is an appropriate strategy to use when the sales manager asks you (the salesperson) to slip a purchasing agent a couple of hundred dollars in order to get him to put in a good word with the buying center for your company's new line of packaging equipment?

A)Ignore the request.
B)Appeal to a higher authority.
C)Threaten to blow the whistle.
D)Leave the organization.
E)All of the above are appropriate strategies to use when handling unethical requests from managers.

Question 70

Roger was distressed when he learned the company he was working for was making unethical use of competitive intelligence it had gained by bribing a competitor's employee. Then Roger was told to use the information in his sales presentation. What can Roger do?

A)Agree to the demand but fail to carry it out.
B)Quit his job and find another.
C)Threaten to blow the whistle to the competitor.
D)Refuse to comply with the request.
E)do any of the above

Question 71

_____ are general management techniques that allow subordinates to bypass immediate managers and take concerns to upper management when the subordinates perceive a lack of support from their immediate manager.

A)Line of command detours
B)Open-door policies
C)Circumvention strategies
D)Supervisory detours
E)Organizational review boards

Question 72

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

A)its inability to be used as a motivation tool
B)its complexity
C)it encourages building long-term relationships with customers
D)it encourages customer service
E)the way it gives the company more control over its sales force

Question 73

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

A)whispering willow.
B)barrister.
C)whistle blower.
D)mouthpiece.
E)chatterbox.

Question 74

Which of the following statements about sales training is true?

A)Most experienced salespeople train others rather than need any training themselves.
B)Most sales managers plan their sales training sessions for experienced sales reps using the model training guide published yearly in the August issue of Sales and Marketing Management.
C)Experienced salespeople find it easy to adapt new techniques they learn in training sessions.
D)A field sales manager is rarely assigned to train a new salesperson.
E)Experienced salespeople often view training sessions as wasting time they could be in the field selling.

Question 75

A _____ resembles a commission, but the amount paid depends on total performance, not each individual sale.

A)bonus
B)draw
C)markup
D)salary
E)combination plan

Question 76

NevaFlat Tire Company has divided the state of Tennessee into three territories―east, middle, and west. Salespeople are based in Knoxville, Nashville and Memphis to work these three territories. Based on this information, you can say with certainty these salespeople are:

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

Question 77

Ed works for Lanier Business Products as a straight commission sales representative. 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 applied to repaying the loan. For Ed a guaranteed $600 is his:

A)transition.
B)indemnity.
C)draw.
D)bonus.
E)assessment.

Question 78

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

A)compound plan.
B)time and results plan.
C)guaranteed draw plus bonus.
D)combination plan.
E)joint payment plan.

Question 79

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

A)buttress.
B)foundation.
C)base.
D)cap.
E)ground rule.

Question 80

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

A)measure customer service levels
B)measure product knowledge
C)measure total sales
D)determine how quickly management requests for information are answered
E)measure how aware each stays of current relevant information about competition and business conditions