Parkin Laboratories: Sales Target Dilemma

Case analysis

Group No: 10
Methun Kumar Pandey Mit Desai
Khilak Kashyap Manmeet Kochhar
Nishant Kumar Jainish
Pranay Mazumdar
 Sales Target are unevenly distributed.

Organization's incentive is dependent on

targets and thus demoralizing if it is uneven

Growth rate should be uniform.

 Expected to $74 Bn in 2020
Strong distribution network
Product portfolio
Lower pricing of medicines in large volumes
Past sales patterns and trends of the
company
Salesmans domain knowledge and
experience
 Expected Industry
Growth Rate
16%
3 quarter Projected Y-o-Y Growth
revenue 2012 revenue over 2011
$344 Million $459 Million 9.3%

Since, 74% of 2011 revenue Substantially below

was made in Jan-Sep quarters industry growth rate

New product launch to help achieve sales targets

Marketing support to boost sales
Reducing the targets will send across a wrong message to the territory
managers who are close to achieving sales targets for the year with a
quarter to go
 Division Uneven distribution of sales targets between territories

Achievability Sales targets may look unachievable for the remaining quarter

Added burden of selling new product on already demoralized

New product MRs
 Investing on sales force development how you
hire, train, develop their skills and attributes over time so they are good
at executing your strategy, not those of a generic selling methodology

Advertising and trade promotions Increase

brand awareness in order to make consumers/businesses aware of
the brand

Invest in an effective MIS - for better and smoother

communication between the employees, trade partners of the company
at various levels. This would lead to faster response times, and higher
problem solving efficiency

Performance management system - help to

influence behavior, especially sales compensation and incentive systems
 New Product will help further diversify the
existing product portfolio(Assumption: New
product will not cannibalize existing one)
This can further help in increasing sales by
cross selling
This may lead to increase in the growth
rate in final target making it possible to
achieve sales target

As Parkinson focus on extensive

product training for MR, they will need
to spend additional time for this
This will make it more difficult for MRs
to complete target number of calls
and hence achieve sales target
If new product fails, the added burden
under absence of incentives can
further demoralize the MR
 Based on the above analysis we would recommend that the launch of the new
product should be delayed to next year

As pharmaceutical selling require MR to have sound product knowledge the MRs will
need to undergo training for this new product

This additional work will further demoralise MRs who are already struggling to
achieve the overestimated sales target

The product should e launched in month of January next year with revised sales
targets

It will not only give MRs sufficient time to understand the product but also allow
RSMs and DSMs to prepare region specific strategies
 Thanks.