Fritos Lays Pakistan

Introduction

Hierarchy of Sales force department

The current hierarchy of Fritos Lays Pakistans Sales force department is as following: General Manager

CFO

Head of sales

Operations head Regional Sales Manager (Centre)

MArketing Head

Human Resource

Regional Sales Manager (South)

Regional Sales Manager (North)

BDM Lahore

BDM Gujranwala

BDM Faisalabad

BDM multan

4 ASMs

14 TSOs

DSR

Order Taker

Term Project SFM

Page 1

Fritos Lays Pakistan

Following are the key responsibilities of the above mentioned designations. RSM:  RSM stands for the Regional Sales Manager.  There are 3 RSMs in the current hierarchy of Frito Lays Pakistan.  RSM plays the role of sales leadership.  His responsibility is to lead and monitor the frontline sales people.  He is also responsible to meet the top line target numbers.  He plays a vital role in the infrastructure planning.  The salespersons development (people development) is also under him that includes the promotion, shifting and planning the sales staff. BDM:  BDM stands for Business Development Manager.  There are 4 BDMs in the current hierarchy and this post is newly introduced in the organizational hierarchy of the company after the removal of the ZM post.  His role is sales execution and management.  He also play role of developing the market.  He directly handles numeric and weighted distribution and growth planning. ASM:  ASM stands for Area Sales Manager.  There are 4 ASMs in the Lahore territory.  He is directly responsible for meeting monthly and daily sales targets set by the higher management.  He is also responsible for handling the distribution related issues.  He is directly responsible for looking after the sales team.

Term Project SFM

Page 2

Fritos Lays Pakistan

The HR of Lays Pakistan

There are different level and bands of HR in Lays Pakistan. All the employees are ranked in these levels (bands) according to their job posts. The employees from TSO to Head of Sales are divided into 11 levels and these levels determine the pay scale and structure of the employee. The GM level employees are divided into 3 BANDS depending on their experience and nature of work they perform. The different levels in the HR are as follows:  Level 1 to 3: TSOs are ranked in these levels.  Level 4 to 6: ASM fall under this category.  Level 7 is for the employees working on the position of BDM.  Level 8 to 10 are for the employees working on the post of RSM.  Level 11 it is the highest level and it is designated to Head of Sales and after that BAND is started and this level indicates the position General Manager.

The Hiring Process:

The internal hiring (hiring within the organization) is very common and most preferred in Lays. They prefer their own employees in order to fill the vacant posts. The second best option is to go for head hunters and the last option is to go for institutional hunting which is done 3 to 4 times in a year. The company has an Assessment Center which works separately. Once the candidates are shortlisted for the interviews, they have a series of interviews at different levels of the organization. The interviewing steps are as follows:  The candidate is interviewed by the HR manager in the first step.  Then he/ she is interviewed by the line manger.  In the 3rd step, the candidate is interviewed by the functional head of the department for which he/she is applying  Then comes the panel interview in which two functional heads take the interview and one of them should be the head of the concerned department.  The interviews of Level 6 and above are taken by the GM himself.

Term Project SFM

Page 3

Fritos Lays Pakistan

Qualification Level:
 Area Sales Managers and above have to have a master degree as a minimum qualification level and MBAs are preferred due to nature of the job.  TSO should have a minimum graduate degree to be qualified for this post.  The hiring is done on 60:40 formula; 60% experienced and 40% fresh.  The minimum qualification level for a DSR is intermediate.

Training and Development:

There are 3 training sessions held by Lays Pakistan in one year. These are mandatory sessions and are held all across the country by company policy. 2 of them are local training session and the other one is external or international training session. All the sales staff from TSOs to GM is required to attend these training sessions. Apart from these mandatory sessions, many other training and developmental sessions are also held throughout the company based on different needs like soft skills, sales fundamentals etc. Every month 2 to 3 such training sessions are arranged by OMD (Organization Management Development). OMD is a separate department of the company which works in training and development related issues of the employees.

Incentives and Compensation:

 Lays Pakistan gives incentives to its sales staff for successfully meeting the sales targets. Incentives of Rs. 5000 are fixed for TSO and ASM in case of achieving 100% sales target but there are no such incentives for the posts above ASM in the hierarchy.  The salesmen (DSR) can earn around Rs. 18000 in one month depending on his performance. His salary and other compensation are paid by PCI.  DSR has a fixed salary of Rs. 12000 and gets Rs. 2500 as fuel expense and Rs 1500 as food and mobile expense.  The most interesting thing is that if he achieves 100% sales target, he gets a commission of Rs.500. If he achieves 110% of his target, he gets Rs. 1000 and if he achieves 120% then he gets the commission of Rs. 2000.  The salesmen get the uniform and shoes (joggers) twice a year by the company.
Term Project SFM Page 4

Fritos Lays Pakistan

 There are different types of rewarding certificates like DSR of the month, DSR of the region and DSR of the year in order to motivate and give recognition to the salesmen. Such salesmen get certificates and gifts from the company like television sets, radio, mobile phone etc.

Evaluation:
There are two types of rankings on which the evaluation takes place: 1. Business Ranking 2. People Ranking

 In order to meet the performance requirements of the company every individual has to perform in the above two rankings (categories) otherwise he/ she will be in trouble.  The performance evaluation in done twice a year: midyear and full year.

Term Project SFM

Page 5

Fritos Lays Pakistan

Sales Quota Allocation

The AOP is made on annual basis at the start of the year. Each kind of statistics is calculated in this meeting. Mainly 2 things are focused upon in these meetings. These include: y Top line: This calculation is done regarding the volumes that company wants to achieve in the coming year related to sales. The figures calculated are for the breakeven point, the profitability and also the estimated figures. y Bottom line: These figures are related to the revenue side that will be generated from the sales. It is basically the estimated net profit and loss account for the coming year. These figures are also for all 3 scenarios that are optimistic, pessimistic and realistic. These figures are then analyzed according to the market condition, future expectations and past performance. These factors help determine the sales targets for the coming year. Once the target is set for the coming year, the quotas are given to the 3 Regional sales managers according to their performance. 50% is given to centre while rest is divided into other 2 segments. Regional sales manager then further breaks it on the basis of market potential, past sales performance and market volume. Area sales managers further trickles it down to territory sales officers who further allocates the allocated quota to the DSRs. The company uses Jury of executive opinion to set quotas and no hard and fast rule is followed in allocating these quotas. If a new flavor is launched in to the market, 15% is added to the sales targets while there is generally 20% increase in the sales targets every year. Sales targets and quotas on weekly basis: There is also allocation of sales targets and quotas on weekly basis. There is a meeting help every week on Friday that is called Standard Operation Procedure (SOP) in which weekly targets are set. These meeting include 5 relevant parties which are:

Term Project SFM

Page 6

Fritos Lays Pakistan

y y y y y

Dispatcher Production department Planning department Procurement Finance

All these parties have their say in the discussion regarding the set targets. At the end of the meeting, every one of the above mentioned 5 parties know that which flavor in which size and in which location and most importantly how much is required to be delivered.

Term Project SFM

Page 7

Fritos Lays Pakistan

Territory designing and routing

Territory designing at the company is done on the basis of convenience and cost effectiveness. This means that a territory is defined as the area in which a DSR can visit 40 shops per day. So a territory is constituted of no more than 240 shops. Each territory is further divided into sub territories for each day. As mentioned above, there are 40 shops in each sub territories which are visited by DSR. These sub territories are made on the basis of cost effectiveness that is the closest 40 are made a sub territory so that fuel consumption can be minimized. The rout es therefore are made on the same basis of fuel saving and for the route feasibility of DSR and DM. The figure of more than 40 calls is technically impossible so maximum of 40 is allocated for a day. Also the DSR and DM for a territory are a group so if a call is made by DSR on a shop, the delivery next day will be done by its DM and no one else. If some other group does cross territory selling, then a warning is given and cross territory selling is strictly prohibited.

Term Project SFM

Page 8

Fritos Lays Pakistan

Sales force number and Demand Estimation

The sales force size is determined by the estimated sales. If there is a potential of 20 tonnes of sales then it means there is a requirement of 1 TSO while if there is potential of 40 tonnes of sales then it means that there is a potential of 1 ASM and so on. These figures ensure that the employee would be able to break even the cost it will have on the company. The demand estimation is based on the following steps:

Acces economic environment

In the first step, the upper management sits together and discusses the current prevailing and estimated future scenarios to come up with figures for the coming year. After accesing the market, the management looks at the product situation in the market. As we were told that Lays is at a maturity stage so this year, the estimated demand is not increasing rather its stagnat. Upon seeing the market potential, the sales forecasts are made which are based on expected market situation and also depending on any new variants that company is planning to lauch in the market. On the basis of the forecasts made, the targets are set for each region and as a result in each teritorry.

Estimate Market potential

Develop Sales forecasts

Establish Sales targets

Term Project SFM

Page 9

Fritos Lays Pakistan

Sales Process
The whole sales process is constituted of the following steps:

Order Taking

The first process of selling is the order taking which is done by the DSR while going out on route. This order is noted on the Order booking page which is taken back to the distributor.

Order Submission

The order is submitted by DSR to the distributor. The order submission form is filled and signed by both parties. This is now responsibility of the distribution incharge.

Car loading and delivery

The distribution incharge then takes the above mentioned information and uses it to get the vehicle loaded for the next day.

Delivery and payment

Next day the delivery man takes the vehicle to the designated stores and get the payment for the delivery of products that are delivered. This payment is taken to the distributor office and is handed to the accountant.

Term Project SFM

Page 10

Fritos Lays Pakistan

Sales Technique
The sales man are taught and tested on the 5 steps of call which they are asked to learn by heart as well as practice while making a call. These steps are as following:

Greeting

First step in making a call is that once the salesperson is at the shop, he needs to greet the shopkeeper well before starting any conversation.

Second task of the salesperson is to observe the situation of the shop. Observe

Sales potential

The third step involves more observation to find out if there is some way that the sales could be increased from the one that was done last time at the respective shop.

Negotiating Order

The necxt step is to take the order and if potential to increase sales in observed in the 3rd step then to persuade and convince the shopkeeper to increase order accordingly.

Making order

In the last step, the salesperson is required to make the order with the consent and agreement of the shopkeeper.

Term Project SFM

Page 11

Fritos Lays Pakistan

Key accounts management

There are two types of key accounts that are handled at Fritos Lays Pakistan. These are named as: y y National Key accounts Local Key accounts

In case of National Key Accounts, the accounts which are present throughout the country, are handled and managed by key accounts manager. These include big corporations and companies like DAEWOO, Pakistan Railways and Hyper star etc. In the case of Local key Accounts, the accounts which are present in a certain region and are not present all over the country come into this category. These include big retailers like Alfatah, HKB and others. The targets are not set for these accounts as they generate demand according to the requirements they have. So the main responsibility of the key account manager is to keep good working relation and providing the required product on time to the customer as they require product in bulk.

Term Project SFM

Page 12