Chapter 6
Sales
Sales management is a dynamic area, constantly facing new problems. The controller has a great impact on the resolution of these problems. An extensive review of sales and distribution costs can help sales executives make prudent decisions consistent with the company's goals.
This chapter discusses the controller's role in relation to the sales department, as well as typical kinds of analyses to apply to sales, the applicability of standards to the sales staff, issues regarding product pricing, and reports that are useful for describing the performance of sales revenue, margins, and costs.
Role of the Controller
The controller's skills are useful in sales accounting and analysis to assist marketing executives in these areas:
- Problems of product. The initial selection of the product or consideration of changes in the line, sizes, and colors generally should be based on the collective judgment of the sales manager (for marketing considerations), the manufacturing executive (production problems), and the controller (cost considerations). The controller should be able to indicate the probable margin on the product, as well as the effect of volume on the margin or the effect of changes in quality, composition, and manufacturing processes on the cost to make or sell. In the continuing review of sales trends, the controller may be able to identify unfavorable trends that could require a redirection of the sales effort or a change in the product.
- Problems of price. In ...
