Companies that sell through retailers depend on salespeople for order collection. Usually, a sales officer is assigned a limited area, and he has to visit all retailers in that area to collect orders. It is also his responsibility to collect payments. For these tasks, some companies have their own salespeople, while others use DSRs (Distributor Sales Representatives). In the current COVID environment, this way of organizing sales will have to be rethought. For a year or so, even after the total lockdown is lifted, several restrictions are likely to be put in place. Travel to/ through certain areas may be restricted or limits may be placed on the number of people that can travel together in a vehicle. Intermittently, many areas could also be completely locked down depending on the number of emergent COVID cases in those areas. Moreover, the behaviour of the retailers will also not be the same as before.  In this scenario, the following are the potential obstacles to physical order-taking by salespeople from retailers:  <h5>Risk of losing sales in an area: When a salesperson either cannot visit/or refuses to visit his assigned area </h5><ul><li>The salesperson may not be able to visit the market due to the particular zone becoming downgraded from a green zone to an orange zone. In orange zones, shops are allowed to remain open, but the movement of civilians will be restricted.</li><li>For most salespeople, the area allocated to them may include a few taluks. He may not be allowed to visit some of these taluks, which will mean zero sales in that area until the lockdown is lifted.</li><li>He may be a resident in a taluk that is under lockdown. Hence he will not be able to go on market visits either in his taluk or other taluks that are not under lockdown. Again, no sales in his assigned area until the lockdown is lifted.  </li><li>A salesperson may also decline to visit the market due to fear of getting infected. The company cannot force him to visit, either. It would affect the reputation of the company negatively, if the salesperson decides to make such a ‘compulsion’, public.</li><li>A salesperson may have to be quarantined if somebody in his family or in his residential building tests positive for the infection. It will be very difficult for companies to get a replacement immediately.</li><li>If public transport has been stopped in the area assigned to a salesperson, then he may not be able to visit retailers, if he does not have a bike or some other mode of transport. </li></ul> <h5>Sales productivity: Order taking from retailers is likely to drop to less than 25%</h5><ul><li>Any limitation placed by governing bodies on the amount of time markets are allowed to stay open or travel in an area will have a major impact on sales productivity. It is possible that only three or four hours are available for visits. In such a circumstance, after adjusting for travel time, the salesmen will only be able to visit 1/3rd to 1/4th of the normal quota of retailers. The number of visits possible will go down further if public transport is infrequently available.</li><li>If restrictions are placed on the time stores can stay open, customers will necessarily have to visit during this time. With social distancing norms in place, these customers are likely to take more than their usual time to complete purchases. Moreover, retailers will want to use all the available time to maximize sales. Hence the time salespeople will spend waiting for the retailer to be free will increase. This will further reduce the number of retailers a salesperson can meet in a day.</li><li>Due to the spread of news/rumours, a salesperson may cancel a planned visit to the market. If he is on a weekly beat, then the gap of time between two visits (to take orders) will increase to 2 weeks.</li><li>Due to the pressure of achieving sales numbers and paucity of time, the salesperson will try to visit the largest counters in his area and skip meeting nearby retailers with smaller counters. This increases the time spent on travelling out of the total available time, thus reducing productivity further.</li><li>Since cash flow is a major concern in the current scenario, collection would take priority. Company and distributors would prioritize salesmen’s physical visits to retailers where collection is due. This will deteriorate the sales productivity.</li><li>Usually, there are targets on sales value. This could again make salesmen avoid smaller counters on their beat in lieu of covering more large counters or cherry-pick counters where there is a ‘higher’ probability of getting payment/orders. Consequently, the company may lose all those smaller retailers it had painstakingly brought into its fold over the years. </li></ul> <h5>Quality of order taking: Range selling likely to be compromised. </h5>Lack of time with each retailer could force the salesmen to cut discussions short. They may not have an opportunity to fully discuss adding to the range of products in a store or how much quantities to stock of each SKU. The interaction is very likely to be extremely transactional, i.e. discuss collections and take any immediate order that the retailer wants to place. The chances of selling anything other than fast movers will be a challenge.  <h5>Additional problems with a weekly beat (or Permanent Journey Plan): The rhythm of order taking, collection and dispatch will be broken </h5><ul><li>Due to a limited open window for visiting his market, a salesman will not be able to complete the planned beat within the day. His one-day beat will have to be spread over three to four days. This means that the time between visits to each retailer will triple/quadruple compared to the current duration; i.e. a weekly visit will become a visit once a month! (If the company wants to continue to stay in touch with retailers every week, it will have to increase headcount by 4X or adopt the Vector, solution which will not increase manpower).</li><li>When the frequency of visits to retailers is reduced to once a month, dispatch frequency will also become once in four weeks instead of once every week.</li><li>Many retailers would be unwilling to wait for more than two weeks for a visit and will probably call the salesmen to place orders. Attending such calls will again reduce the salesmen’s time have to complete their physical beats.</li><li>The beats will now have to be aligned dynamically (unlike the old times when they were fixed).</li><li>The cost of completing the beat would increase as the salesmen will have to repeatedly – over three/four days – visit the same market, which was earlier completed in a single week.</li><li>Since not all counters will be open depending on the uncertainty in an area, this will further reduce the productivity of a beat.</li><li>Essentially, the rhythm set with the weekly beat plan – i.e. of order taking, collection and dispatch will be broken. This will lead to a change in the behaviour of both retailers and salesmen. The advantages of having a beat plan will vanish. Month-end spike, high receivables and pressure on sales numbers will reign. </li></ul> <h5>Impact on order intake due to irregular visits: Drop in the number of regular retailers placing orders </h5>In an environment where the frequency of visits of a company’s salesmen is unknown/not defined, retailers will tend to buy from whoever visits when the demand exists. So, when the company salesmen eventually visit, they would perceive these retailers as ‘not interested’ and may avoid visiting them in future.  <h5>Market structure-related obstacles: Indirect distribution will be crippled </h5><ul><li>Indirect distribution: using a handful of wholesalers to reach all retailers or expecting retailers to buy from wholesalers/ distributors in other cities- will be ineffective. Social distancing norms could leave retailers with a very small window to conduct sales at their own outlets. They will not have time to visit wholesalers.</li><li>Wholesale markets may have fewer retailer visits due to paperwork-related harassment by the local administration. </li></ul>

Key Takeaways

Companies that sell through retailers and depend on salespeople for order collection faced unprecedented challenges in managing sales when the lockdown curtailed the movement of sales teams. However, this allowed companies to try and figure out how to do sales in such an environment. There are some major learnings.

Retail sales operations: Challenges in the current COVID environment

Companies that sell through <a target="_blank" rel="noopener noreferrer" href="https://www.vectorconsulting.in/en/research-and-publication/articles/retailer-s-dilemma/">retailers</a> depend on salespeople for order collection. Usually, a sales officer is assigned a limited area and he has to visit all retailers in that area to collect orders. It is also his responsibility to collect payments. For these tasks, some companies have their own salespeople, while others use DSRs (Distributor Sales Representatives). In the current COVID environment, this way of organising sales will have to be reconsidered. For a year or so, even after the total lockdown is lifted, several restrictions are likely to be put in place. Travel to/ through certain areas may be restricted or limits may be placed on the number of people that can travel together in a vehicle. Intermittently, many areas could also be completely locked down depending on the number of emergent COVID-19 cases in those areas. Moreover, the behaviour of the retailers will also not be the same as before.  In this scenario, the following are the potential obstacles to physical order-taking by salespeople from retailers:  <h5>Risk of losing sales in an area: When a salesperson either cannot visit/or refuses to visit his assigned area </h5><ul><li>The salesperson may not be able to visit the market due to the particular zone being downgraded from a green zone to an orange zone. In orange zones, shops are allowed to remain open, but the movement of civilians will be restricted.</li><li>For most salespeople, their allocated area may include a few taluks. He may not be allowed to visit some of these taluks, which will mean zero sales in that area until the lockdown is lifted.</li><li>He may be a resident in a taluk that is under lockdown. Hence he will not be able to go on market visits either in his taluk or in other taluks that are not under lockdown. Again, no sales in his allocated area until the lockdown is lifted.  </li><li>A salesperson may also decline to visit the market out of fear of getting the infection. The company cannot force him to visit, either. It would affect the reputation of the company negatively if the salesperson decides to make such a ‘compulsion’ public.</li><li>A salesperson may have to be quarantined if somebody in his family or in his residential building tests positive for the infection. It will be very difficult for companies to get a replacement immediately.</li><li>If public transport has been stopped in the area allocated to a salesperson, he may not be able to visit retailers if he does not have a motorcycle or some other mode of transport. </li></ul> <h5>Sales productivity: Order taking from retailers is likely to drop to <25%</h5><ul><li>Any limitation placed by governing bodies on the amount of time markets are allowed to stay open or travel within an area will have a major impact on sales productivity. It is possible that only three or four hours are available for visits. In such a circumstance, after adjusting for travel time, the salespeople will only be able to visit 1/3rd to 1/4th of the normal quota of retailers. The number of visits possible will go down further if public transport is infrequently available.</li><li>If restrictions are placed on the no. of hours the stores can stay open, customers will necessarily have to visit during those hours. With social distancing norms in place, these customers are likely to take longer than usual to complete purchases. Moreover, retailers will want to use all the available time to maximise sales. Hence the time salespeople will spend waiting for the retailer to be free will increase. This will further reduce the number of retailers a salesperson can meet in a day.</li><li>Due to the spread of news/rumours, a salesperson may cancel a planned visit to the market. If he is on a weekly beat, the gap between two visits (to take orders) will increase to two weeks.</li><li>Due to the pressure of achieving sales numbers and paucity of time, the salesperson will try to visit the largest counters in his area and skip meeting nearby retailers with smaller counters. This increases the time spent on travelling out of the total available time, further reducing productivity.</li><li>Since cash flow is a major concern in the current scenario, collection would take priority. The company and distributors would prioritise salespeople’s physical visits to retailers where collection is due. This will deteriorate the sales productivity.</li><li>Usually, there are targets on sales value. This could again make salespeople avoid smaller counters on their beat instead of covering more large counters or cherry-pick counters where there is a ‘higher’ probability of getting payment/orders. Consequently, the company may lose all those smaller retailers it had painstakingly brought into its fold over the years. </li></ul> <h5>Quality of order taking: Range selling likely to be compromised</h5>Lack of time with each retailer could force the salespeople to cut discussions short. They may not have an opportunity to fully discuss the addition of a range of products in the store or the quantities to stock for each SKU. The interaction is very likely to be extremely transactional, i.e. discuss collections and take any immediate order that the retailer wants to place. The chances of selling anything other than fast movers will be a challenge.  <h5>Additional problems with a weekly beat (or Permanent Journey Plan): The rhythm of order taking, collection and dispatch will be broken </h5><ul><li>Due to a limited open window for visiting his market, a salesman will not be able to complete the <a target="_blank" rel="noopener noreferrer" href="https://www.vectorconsulting.in/en/research-and-publication/articles/driving-pharma-sales-in-developing-countries/">planned beat</a> within the day. His one-day beat will have to be spread over three to four days. This means that the time between visits to each retailer will triple or quadruple compared to the current duration; i.e., a weekly visit will become a visit once a month! (If the company wants to continue staying in touch with retailers every week, it will have to increase headcount by 4X or adopt the Vector, solution which will not increase manpower).</li><li>When the frequency of visits to retailers is reduced to once a month, the dispatch frequency will also drop to once every four weeks instead of once every week.</li><li>Many retailers would be unwilling to wait for more than two weeks for a visit and will probably call the salespeople to place orders. Attending such calls will again reduce the salespeople’s time have to complete their physical beats.</li><li>The beats will now have to be aligned dynamically (unlike the old times when they were fixed).</li><li>The cost of completing the beat would increase, as the salespeople will have to repeatedly – over three/four days – visit the same market, which was earlier completed in a single week.</li><li>Since not all counters will be open due the uncertainty in an area, this will further reduce the productivity of a beat.</li><li>Essentially, the rhythm set with the weekly beat plan – i.e. of order taking, collection and dispatch will be broken. This will lead to a change in the behaviour of both retailers and salespeople. The advantages of having a beat plan will vanish. Month-end spike, high receivables and pressure on sales numbers will reign. </li></ul> <h5>Impact on order intake due to irregular visits: Drop in the number of regular retailers placing orders </h5>In an environment where the frequency of visits of a company’s salespeople is unknown/not defined, retailers will tend to buy from whoever visits when the demand exists. So, when the company salespeople eventually visit, they would perceive these retailers as ‘not interested’ and may avoid visiting them in future.  <h5>Market structure-related obstacles: Indirect distribution will be crippled </h5><ul><li>Indirect distribution: Using a handful of wholesalers to reach all retailers or expecting retailers to buy from wholesalers/distributors in other cities, will be ineffective. Social distancing norms could leave retailers with a very small window to conduct sales at their own outlets. They will not have time to visit wholesalers.</li><li>Wholesale markets may see fewer retailer visits due to harassment by local administration over paperwork. </li></ul>

Problem: COVID-19 restrictions has hindered salespeople's ability to visit retailers, resulting in missed sales, reduced productivity, and ineffective range selling. Traditional sales methods had failed to adapt to irregular visits and rapidly changing lockdown conditions. Solution: Some companies shifted to a hybrid sales model that combined phone-based order-taking with limited in-person visits. They implemented dynamic, flexible planning to adjust to travel restrictions, reduced reliance on fixed territories, and used digital platforms for centralised order management. Benefits: Greater sales reach, improved productivity, minimised disruptions, better retailer engagement, and more efficient order management despite COVID-19 restrictions.

<h5>Retail sales operations: Challenges in the current COVID environment </h5>

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In the current COVID environment, the established way of organizing sales will have to be rethought. Read to know more.