Key Concepts Used in Sales & CRM
Sales are those activities related to the exchange of products or services at a given point of time. The term sales is commonly used as an aggregate term encompassing many sales activities including business sales, retail sales, and services sales. The exchange of a product for another, which results in the payment of money for the former is also commonly termed a sale. There are various sales activities like providing services, manufacturing, distributing, selling, financing, etc. The objective of all sales activities is to make money from sales.
CRM stands for Customer Relationship Management. CRM is a strategic system that integrates the sales process and client database to improve customer satisfaction levels. CRM helps in improving customer retention rates and making the buying decision more convenient. CRM has four stages – planning, development, deployment and maintenance. CRM is an important tool to help businesses in defining and realizing their sales goals. Through the use of CRM one can improve the sales process and increase the customer base, which ultimately leads to increased sales and profits.
Net sales – This is the difference between gross sales and net sales. Net sales include the total amount paid to the seller for sales but do not include any money received from the buyer. Net sales are important since they help in determining the profitability of sales and help in reducing inventory let us say the total cost of producing an item and the cost incurred to produce it and finally the profit made from the sale of the item.
Since there is no direct relationship between net sales and gross sales, it is also important to take into account other factors such as e.g., the cost of good sold is dependent on the quality and price of the good sold hence calculating gross sales may not provide a clear picture of the profitability of the sales process.