Sales Mix

SALES MIX covers marketing and profit with, optionally, interpersonal relationships and group processes.

Participants are responsible for marketing two types of product into two sales areas. They have to decide the prices for the products and the promotion for the sales areas. Based on these the simulator calculates sales, a profit and loss account and a forecast for the next period.

Participants have unit sales, revenue and profit targets. So, optionally, individuals can be assigned responsibilities for meeting these and authority for one decision area. This can be used to explore team working behaviours, especially from period four onwards where an additional report shows performance against budget! (And can be used to instigate conflict!). However, the matrix of decisions and results means that, to be successful, the team must overcome any conflict.

Sale Mix is ideal for sales and marketing courses and courses exploring behaviour (where it can replace team building activities that are not business based). A special version exists (Hit the Target) for sales and business conferences (where it can be used to develop leadership without dangling your key staff on a rapidly fraying rope over a pit of alligators).

Originally designed in 1983, Sales Mix has been in use since then and was completely revised in 1999 (incorporating our latest design paradigms).

KEY LEARNING: The simulation covers these issues:

• PRICING & PROMOTION RESPONSE
• PROFIT CONTRIBUTION
• COSTS OF BUDGET VARIANCES
• GROUP WORKING
• INTERPERSONAL CONFLICT
• INTERPERSONAL NEGOTIATION
• TEAM BEHAVIOUR

DURATION: Three hours. This short duration allow the simulation to fit into most course time-tables (even the "difficult" after dinner slot).

TARGET AUDIENCE: The simulations are designed to be used by trainees, junior management up to middle management, functional specialists and supervisors. Or, as an ice breaker, for all levels up to senior management.

METHOD: After a short briefing the training group is divided into several teams of three to five participants. Each consider the problem facing them and then make a series of decisions that are fed, by the team, into their own microcomputer that simulates their effect. The results are printed for the team to analyse before making their next decisions. This decision-making cycle should be repeated for at least eight periods. At the end of the simulation phase the teams reunite to discuss and compare results.

The simulations may be used with any number of teams and, if necessary, up to three teams may share a microcomputer.

AVAILABILITY: This simulation is available off-the-shelf and a comprehensive Trainer's Pack is provided allowing trainers with little or no experience with simulations to run the them.

DOCUMENTATION

Documentation is provided separately for the UK and US Versions MS Word format and comprises:

A Participants' Manual that provides, for the participants. a description of the simulation, a description of their task and how to use the software.

The Background Notes describe the simulation for the trainer and may be used as a handout to the participants at the end of the simulation.

The Record Sheets are optional and are provided to allow teams to share key results as the simulation progresses.

Using the Simulator provides, for the trainer (and computer support staff), information about installing the simulation and the use of the software.

Running the Simulation provides, for the trainer, information about running the simulation.

Briefing is a MS Power Point briefing explaining the simulation to the participants. (You may find it useful if you review this before reading the briefs.)

	UK Versions	US Versions
Participants' Manual
Background Notes
Record Sheet
Using the Simulator
Running the Simulation
Briefing

KEY LEARNING

PRICING & PROMOTION RESPONSE

Initially, participants are selling an established product into an established sales area. At the same time they must launch a new product and penetrate a new area. During the simulation, teams must price and promote to grow the sales of the new product and the new sales area. In doing so, the contribution of the established product selling into the established sales area will fall from about sixty percent to about twenty-five percent.

PROFIT CONTRIBUTION

Besides seeing the financial impact of decisions in terms of total revenue, cost of sales, promotion costs and profit, participants should review the separate profit contribution of each product and each sales area.

COSTS OF BUDGET VARIANCES

The purpose of the simulation is to be successful and to meet targets for unit sales of the products, area revenues and overall profit. Initially, meeting targets is not emphasised. However, in the fourth period an additional report is produced summarising performance against the targets for the period and cumulatively. Later, in period six, a further report quantifies the costs of budget variances. So, the simulation can be used to demonstrate to sales people how their actions influence production and financing costs. Further, it can be used to show how maximising the results from one part of the business may sub-optimise the profits of the business as a whole.

GROUP WORKING

Each team can consist of between three and five participants, each of whom can be assigned a role - product manager, sales manager and marketing manager. The product managers are responsible for meeting unit sales targets for the products and have the authority to set selling prices. The sales managers are responsible for meeting area revenue targets and have the authority for setting promotion levels. The marketing manager is responsible for overall profit and co-ordination but has no decision-making authority.

INTERPERSONAL CONFLICT

The initial de-emphasis of targets means that each team tends to work in an unfocussed collaborative manner aiming at maximising unit profits and forgetting about the targets. However, when the target comparisons are produced and, if the trainer rewards those participants who are close to target, this will introduce conflict. (This is especially true if, at this point, the trainer announces a prize for the individual closest to budget at the end of the simulation.) However, to meet individual and team goals, conflict must be resolved and individuals collaborate.

INTERPERSONAL NEGOTIATION

The matrix of authorities and responsibilities means that, for an individual to meet his or her target, he or she must negotiate with the others and make trade-offs.

TEAM BEHAVIOUR

In terms of team behaviour, each team moves from a friendly, unfocussed group, through a period of conflict to a well-balanced purposeful team. To help explore this, an optional questionnaire is provided. The questionnaire asks individuals their feelings about fellow team members - feelings that may include helpful, determined, disorganised, divisive, weak, etc..

SIMULATOR DOWNLOAD

This is provided to allow you to download an evaluation version of the Sales Mix simulation. Before you do this you must have two blank formatted floppy discs available (labeled Disc 1 and Disc 2). Also be advised that the Cab files will take some time to down load.

The table below shows the files to download, their description, size and the floppy disc to save to. Once all files are downloaded, place Disc 1 in your floppy drive. Click Start and then Run and enter A:\setup.exe. The program will then install.

Help with downloading - especially with Windows XP or Vista.

If, instead of installing from the Web, you are installing from the CD-ROM version of this resource you can install directly by clicking setup.exe and opening the file.

Most recent update: 06/09/08
Hall Marketing, Studio 11, Colman's Wharf, 45 Morris Road, London E14 6PA, ENGLAND
Phone & Fax +44 (0)20 7537 2982 E-mail jeremyhall@simulations.co.uk