Sales management is the work that connects business goals with the sales team's daily actions: who to sell to, on what terms, who handles customers and how to correct deviations. It includes planning, organising work, training, motivation and checking that tasks are carried out. The business owner sets commercial priorities and limits, while the head of sales turns them into tasks for the team and takes responsibility for subsequent decisions on deals.

You ask your head of sales to increase sales, maintain prices and get payments in faster, all at once. They bring you a large order with payment due later. The order brings the team closer to one goal and further from another. You have to make the decision yourself again, even though you appointed the head of sales precisely to make decisions independently.

It is tempting to explain this as a weakness in the head of sales: a strong one will work it out. But what exactly have you asked them to choose when your requirements clash? Without that choice, even an experienced head of sales will either seek approval for every concession or make a commercial decision for you that you later disagree with.

I believe sales management should be handed over together with rules for choosing between goals. Otherwise, the head of sales is responsible for the result, but any difficult customer brings them back to the owner's door.

Goals of sales management

Sales management goals define what results the company expects from the team and what it is prepared to give up to achieve them. Revenue growth, money coming in, order profitability, new buyers and repeat sales are connected, but they do not replace one another. A signed contract with payment due in a month will not put money in the account today.

Start by choosing the main result for the coming period and the conditions you cannot sacrifice to achieve it. For example: receive an agreed amount in payments by the end of the month while maintaining approved prices and advance payment terms. This already provides a rule for choosing: a salesperson has no reason to seek approval for a long delay before payment as a way of meeting this particular sales plan.

Another owner may deliberately choose to win a large buyer and allow later payment. Along with that goal, they accept the consequences: the money will arrive later, and the order will have to be fulfilled using the funds available. The head of sales must show these consequences before the terms are agreed.

Write down the goal so that two people would calculate its achievement in the same way:

  • What counts: paid orders, signed contracts or shipments. Each measure has its own total.
  • Over what period: a calendar month, a quarter or the duration of a specific project.
  • What limits apply: price, payment deadline, permitted spending and the ability to fulfil the order.
  • Who authorises an exception and up to what date it still makes sense for the deal.

The last point also protects the head of sales. Demanding more money while forbidding every available way to obtain it means leaving the choice unresolved at the owner's level.

Functions of sales management

The functions of sales management are easier to explain through the decisions they should support. Simply listing “sales plan, motivation, monitoring” does not show what the head of sales does between reports.

  • Planning. The head of sales connects the goal with current deals and sources of new orders. The result is a clear view of how much of the sales plan is supported by facts and where a way to generate sales is still needed.
  • Organising work. The head of sales allocates customers, salespeople's time and help from specialists. If a salesperson is busy with a complex calculation, their new enquiries go to an assigned colleague, rather than an available person the owner happened to find.
  • Training. The head of sales examines a specific difficulty and helps the salesperson apply the right action in a new situation. Knowing the product and being able to explain an advance payment condition to a buyer are different skills; a product lecture does not replace the second skill.
  • Motivation. Requirements and rewards must support the same choice. If bonuses reward only signed contract values, while payments are the main requirement, the head of sales will have to fight a rule the company itself has set every day.
  • Monitoring and adjustment. The head of sales compares the promised step with what happened and changes the next action. If a customer postpones a purchase, the head of sales updates the forecast and the salesperson's workload without waiting for the reporting date.

These functions work together. A new payment rule requires an explanation to salespeople; that explanation requires a review of negotiations; the outcome of the negotiations requires an adjustment to the forecast. A report on its own only completes the gathering of information. Management continues until a decision changes how the team works.

How to manage sales

Start with one line of business where the buyer, the offer and the path to payment are clear. If you mix new contracts, renewals and repeat orders, the same shortfall against the sales plan will hide different causes. In one case, people are still looking for a buyer; in another, they are waiting for payment on an order already accepted.

Separate the goal, the forecast and the possible course of action

The goal says what the company wants to achieve. The forecast shows what result is expected based on current facts. A possible course of action describes what will change if a specific decision is made. These three lines must be kept separate, otherwise the owner's wish quietly becomes the head of sales' promise.

Let us look at a worked example, not a RENTROP case study. All amounts and terms are set for this calculation. The company wants to receive 4 million roubles in payments during the month. At the middle of the month, the picture is as follows:

  • 2 million roubles has already been received.
  • Another 1.2 million is expected from other orders: terms have been agreed, and buyers have confirmed payment dates before the end of the month.
  • An order for 800 thousand is being discussed separately. The buyer asks to make the entire payment next month.

The forecast for money coming in under agreed terms is 2 million + 1.2 million = 3.2 million roubles. The shortfall against the goal is 800 thousand. Adding the whole order under discussion to the forecast is convenient: it gives exactly 4 million. But it will bring in no money this month.

The head of sales proposes negotiating an advance payment of 40%. If the buyer agrees and pays it this month, the company will receive 800 thousand × 40% = 320 thousand roubles. The forecast will then become 3.52 million, and the shortfall will be 480 thousand. The remaining 480 thousand from this order belongs to next month.

This is a proposal to the owner: authorise these payment terms if they differ from the current ones. Until both sides agree, the additional 320 thousand remains a possibility. It cannot be included in the main forecast as money already expected under agreed terms.

There are two separate decisions here. The first is which terms are acceptable for the large order. The second is where to find the remaining 480 thousand this month. Approving the deal does not automatically solve the second problem. If there are no more suitable orders, the head of sales reports the gap; the owner decides whether to change the terms, the resources or the goal itself.

The expected payments of 1.2 million also need follow-up. A confirmed date is a basis for the forecast, but until the money arrives, the head of sales is responsible for working with buyers and updating the information when agreements change.

Set the decision deadline before the opportunity to act runs out

In the same example, the buyer is choosing a supplier before Thursday. If the owner reviews exceptions only on Friday, the weekly report will arrive on time according to the calendar and too late for the deal. The head of sales must bring the choice of terms to the owner before Thursday, stating the latest time they can still respond to the buyer.

This gives a practical management schedule:

  • Every day, the head of sales reviews promises to customers, delays and questions that are blocking today's work with the team. The owner is involved only in decisions beyond the authority granted.
  • Every week, the head of sales shows the owner the updated forecast, the reasons for the gap against the goal and the measures taken. For unresolved questions, they provide options, consequences and a deadline for a response.
  • At the end of the month, the owner and the head of sales compare the result with the costs and the terms on which it was achieved. They then choose the priority for the next period and changes to resources.

An urgent exception does not wait for the next meeting. But the owner should not have to hear about every ongoing action either: otherwise, the team's schedule will simply be added to their own.

Give data a specific job

The CRM system needs information the head of sales uses to make decisions: what is being ordered, the amount, payment terms, the deadline confirmed by the customer and the next step. The finance employee holds the record of money received. Bringing this information together into a forecast is the head of sales' responsibility; the owner does not need to assemble it personally from messages.

The owner only needs to ask for an explanation of the change. It was 3.2 million and is now 2.9 million: which order has moved, what has the head of sales done, and is there still a way to receive this money on time? If there is no answer, adding charts to the report will not help anyone choose an action.

How to manage salespeople

Managing salespeople means turning the chosen priority into work that specific people can carry out. The requirement “we need payments this month” is too broad: one salesperson will start pressuring customers, another will promise discounts, and a third will focus only on nearly closed orders and abandon new buyers.

The head of sales assigns tasks according to the customer's stage. In the worked example, the salesperson handling the large order needs to discuss advance payment, obtain the buyer's answer and pass it to the head of sales before the supplier selection deadline. They are not authorised to promise new terms independently. A colleague continues to handle current payments; the large deal does not cancel that work.

Assessing people by a single amount is also insufficient. When one person is given repeat orders and another a new segment with a long approval process, the difference in payments cannot be attributed entirely to a difference in ability. The head of sales compares comparable work: which customers the salesperson had, what they were asked to do, what action they took and how the buyer responded.

If a salesperson cannot explain a payment condition, they need help with negotiations. If they can, but promise later payment contrary to the agreement, a conversation about following the rules is needed. If the buyer only ever purchases with payment due later, the question returns to the choice of customers and commercial terms. Pressure on the salesperson will not fix these three situations in the same way.

The owner retains the right to change the priority. But a new instruction to the team must go through the head of sales, together with a decision on which previous work to postpone. Otherwise, the head of sales is responsible for a sales plan that the owner changes through individual messages to salespeople.

What to hand over to the head of sales and what the owner should keep

The head of sales takes on the daily allocation of work, following up on deals, training, checking that agreements are kept and revising actions when things go off course. To do this, they are given authority to allocate the team's time and choose ways of working within the agreed terms. Each such decision does not require separate permission from the owner.

Business goals, the product, prices, the budget, acceptable commercial risks and staffing decisions made as the employer remain with the owner. The head of sales prepares the case for changes; the owner makes the decisions within their remit. The boundary depends on what the decision concerns: redistributing current enquiries within the team and increasing recruitment spending require different powers.

In a small team, the owner may carry out this daily work themselves. It must then have a place in their calendar. I examined this choice separately in the article “Can a business owner manage sales without a head of sales”. Whether the position exists is secondary here: first, you need to determine who can consistently do the work itself.

A sample instruction to put sales management into practice

Below is a ready-to-use basis for a message to the head of sales. It sets the task of preparing decisions within two working days; the deadline applies to preparation, not to a promise of sales growth.

By the end of the second working day, prepare a proposal for sales management for the current month. Keep the payment goal separate from the forecast. In the forecast, separate money already received, money expected under agreed terms and possibilities that still require a customer decision or our approval.

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For each gap against the goal, state the cause, your action, the person responsible and the deadline. If closing it requires changes to the price, budget or payment terms, bring me an option with its consequences. State the last date on which my decision can still help the deal.

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Allocate current work among salespeople within the agreed terms. List the decisions you make yourself and the exceptions you bring to me. Suggest a time for a short weekly meeting; bring urgent exceptions to me before the deadline for responding to the customer expires.

Accept this work as complete on the basis of a filled-in example from current sales. The owner sees the forecast calculation, the action chosen by the head of sales and a specific question for them to answer. The salesperson affected by the decision has already received a task and knows the deadline. If the document leaves every part of the choice to the owner, from finding the cause to allocating work, the instruction has not yet been carried out.

When the owner remains the real head of sales

After authority has been divided, a practical question remains: who will do this work every day? If the owner still assembles the forecast, chooses actions and ensures they are carried out, only the preparation of information has been handed over. This will not free up time to develop the business.

At RENTROP, turnkey sales management means handing over the daily leadership of the team: the owner stops being the real head of sales. Commercial decisions that require the owner's authority remain with them.

A large order with payment due later will still require your decision if it changes the permitted terms. But it should reach you with the consequences already calculated and a proposal from the head of sales: the owner chooses what risk the business will take, while the team continues working without waiting for the owner to assign a task to every salesperson.