The Sales Director of a Medium-Sized Company Selling Chemicals to the Lumber

question 55

Multiple Choice

The sales director of a medium-sized company selling chemicals to the lumber industry has analyzed sales and found serious problems with the closing rate of sales representatives relative to the number of prospects. The sales director commissioned a research company to analyze the numbers in the CRM system and conduct interviews with prospects who became customers as well as with prospects who did not buy from the company. He also hired a sales training consultant to analyze the sales representatives and the training they receive.
-After analyzing information gathered from prospects who did not buy from the company,it becomes apparent that prospects felt that the sales representatives did not know about the full line of products they carried or understand their uses. The prospects most likely did not buy because they could not:

• A)ensure that the company's billing process was ethical
• B)understand what their business objectives were
• C)pay the high prices the company was charging
• D)store the chemicals once they were delivered
• E)trust the sales reps to sell them the correct products

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Definitions:

Full Cost

The total cost associated with producing a product or providing a service, including both direct and indirect costs.

Contribution Margin

The amount by which the sale of products or services exceeds variable costs, contributing to the coverage of fixed costs and profit generation.

Machine Hour

A unit of measure representing an hour of operation of a machine, used in calculating the cost of running machinery for manufacturing.

Profit Margin

A financial metric that measures the amount of net income earned with each dollar of sales.