Classification & Structure of Sales organization

Classification of Sales Organisation:

Based on three structural variables, different organization structures can be described viz. – formal and informal organizations, horizontal and vertical organizations, centralized and decentralized organizations, line and staff organizations

1. Formal organizations have rigid structures and reporting relationships which often result in poor flow of communication.
2. Informal organizations do not have a rigid hierarchical structure, set communication channels or reporting relationships.
3. Vertical organization structure is a traditional management structure with authority being the basis of control.They have more hierarchical levels.
4. Horizontal organization is one in which both management levels and departmental boundaries are reduced greatly.
5. Decentralized sales organization is one in which each division within the organization has its own sales force to sell the products of that division alone.

Structure of the Sales Organisation:

The following factors are to be taken into consideration while designing the structure of a sales organisation:

1. Nature of the market
2. Sales policies of the enterprise
3. Nature of the product
4. Number of products
5. Availability of financial resources
6. Level of distribution system
7. Size of the company
8. Price of the product
9. Ability of the professionals
10. Position of competitors’