ASCLEPIUS

CONSULTING: THE
SALES FORCE DILEMMA

PRESENTED BY : GROUP 9
DEEPIKA CHAUHAN F009 JAGRITI DHAWAN F017
ABHISHEK KHEMKA F029 SAUNDARYA MEHRA F038
SHANTANU SHARMA F057 SAURABH YADAV F066
 Market Segmentation
On basis of TYPE OF HOSPITALS On basis of NUMBER OF BEDS
Day care centres, nursing homes and charity 30 to 100
hospitals
100 to 300
Charity hospitals
More than 300
Single and multi-specialty hospitals
Corporate chain of hospitals
Single specialty hospitals

Based upon available customer and average deal size data,

Number of Single Multi Nursing Charity Corporate Day care

beds speciality speciality homes hospitals chains centres
Most attractive
30-100 market segments for
Asclepius
100-300

>300
Market Attractiveness
 Market attractiveness is essentially an indicator of how hard or easy it is going to
be for a company to compete in a market and eventually earn profits
 The following factors could collectively define market attractiveness in an
industry:
 Market Potential
 High growing/stagnant
 Long term growth potential
 Scalability & accessibility
 Market Size
 Competitive rivalry
 Threat from competitors
 Barriers to entry
 Threat from substitutes
 Supplier power
Key Factors for a Sales Strategy
 Customer Segmentation on the basis of amount customers ready to
spend, type of product they prefer to purchase and the size of their
facility

 Customers with whom sales team need to deal with such as MD,
CEO of hospitals

 Amount of Assistance required for the product by its various

customers
Sales Strategy for Asclepius and its Target Market
30-100 Bed Customers 100-300 Bed Customers More than 300 Bed

Maximum no. of customers are in Reasonable no. of customer to Less no. of customers in this
this range. offer its products. segment.

Need only basic Modules. Average deal size is significant. Average deal size is very high.

Highly Price Sensitive. These focus on end to end Huge demand for end to end
software solution. software solution.
Deal size is small as focus is
on modules not the end to end They also need support for overall
system. process improvement.

In this case, organization should In this case, organization should In this case, organization must
use resellers as revenue is less focus to deploy its own sales develop and use its own sales
from this segment that makes it team as advice and support is team as consulting is valued by
difficult to use it own sales force. valued by customers and deal size these customers and they need
is significant to sustain its own customized solution as they have
sales team. complex processes.
 Decision making Unit (DMU)

Decision Making Unit Role Criteria of Evaluation

Stakeholders (MD/ CEO) Economic Buyer - Expenditure / ROI

- Benefits of process optimization
- Improvement in service quality
- Scalability of the Product
- Vendor ‘s credibility
IT/ Administrative Staff User - Product specifications
- Integration of the system with
existing processes

Labs/ Pharmacy / Specialized Technical Buyer - Easy and convenient to use

Departments - Daily utility of product
 DMU relevance to Sales Strategy
Different strategy can be used wrt every DMU

Top Management IT Department Labs/ Pharmacy

 Focus on meetings with  Provide training and  Sales strategy should
Top Management as support to IT Department focus on getting
they are the final for using the product recommendations
decision makers. from consultants
 Provide post sales services
to the staff  Focus on explaining
 Explain features like the benefits to
customized modules and Doctors,
pricing system to influence Departments etc.
them
 Purchasing behavior of the various segments
Customer Segments Need/Behaviour Sales Strategy
Day Care Centre & Inexpensive, price sensitive Target doctors
Nursing Home Easy integration & operation Focus on process efficiency
Basic modules Use of testimonials
Charity Hospital Inexpensive, price sensitive Target managers
Focus on productivity, Basic Modules Cost-benefit analysis
Corporate Chain of hospitals Complete integrated solution Target MD/CEO, Purchase
package, Complex products through RFPs, and same
platform for all vendors,
dedicated salesperson
needed
Single Speciality Specific knowledge Target managers
Complex products Focus on ROI and process
Selected modules optimisation
Multi Speciality Complete solution package Target departments
All necessary & add-on modules Focus on cost effectiveness,
Smooth implementation process
optimisation & after sales
support
Go-To Market Alternatives

Resellers Inside Sales force

+ Higher customer reach-generating
20 warm leads per year + Higher customer interaction

+ Better knowledge about local + Better product knowledge, so better

probability of closing deals
markets
+ Better Average deal size - 500000- 1.5
+ Lower commission rate for inside million per quarter
salesperson

- Higher costs
- Average deal size- 500000
- Probably higher commission rates for
- An inside sales person needed per inside sales person
10 resellers to close deal - Lesser customer reach
- Less Customer face time
 RECOMMENDATION
Combination of both reseller and inside salesforce

 Based on the pros and cons of both the models(Reseller and Inside
sales) and on basis of the purchasing behaviour of the various
segments, we recommend a combination of both the models
 With areas of dense competition, a reseller model can help reach
customers faster and create more opportunities, keeping costs
relatively lesser.
 With areas where the company wants to penetrate the market, with
less or no competition, company can use inside sales force model,
as customer interaction becomes necessary, and to drive process
based sales and provide value to the target customer.
Number of salesperson and resellers
required to break even
Particulars Resellers Sales Representatives
(Inhouse)

Fixed Cost per year (1) 8,500,000 8,500,000

Variable Cost per unit per 908,000 160,000

year (2)

Total sales per unit per 4,000,000 1,000,000

year (3)

Contribution Per Unit Per 3,092,000 840,000

Year (3 - 2)

Number required to break 3 (appx) 10 (appx)

even (1/2)
Number of salesperson and resellers
required to effectively cover the
market
Particulars Resellers Sales Representatives
(Inhouse)
Market Potential (4) 4,777,000,000 4,777,000,000
Average Deal size per 1,000,000 4,000,000
unit per year (5)
Number required for 4,777 1,195
market coverage(4/5)
 Working Notes
 1. Fixed Cost per year
3. Total sales per unit per year
Costs of Software 1,000,000 Deal Size Inhouse Sales 1,000,000
Total R&D Exp 2,500,000 Representatives
Total Other Expenditure 5,000,000 Deals per Quarter expected 1
Deals Per year per inhouse sales 4,000,000
Total Fixed Cost 8,500,000
representative

 2. Variable Cost per unit per

year Deal Size Resellers 500,000
Recruitment Costs 42,000 Training 50,000 No of leads/ year 20
Training 50,000 Conversion to business (10%) 2
Empanelment 50,000
Salary 500,000
200,000 Variable
Deal per year per reseller 1,000,000
Other Overheads
24,000 Commission 50,000
Travel Reimbursements
Mobile Bill Reimbursements Reseller Support 10,000
12,000 Incentive
Incentive (2 % of Sale- 4000000) 80,000
Variable cost per
Total Variable per Sales Rep 160,000
908,000 Reseller
 5. Effective Market Coverage
Number of entities where Asclepius can offer its products
Number of
beds\Type of Single Specialty Multi-specialty Nursing Homes Charity Hospitals Corporate Chains Day Care Centres
Hospital
30 to 100 614 245 1155 95 19 2235
100 to 300 345 271 415 178 9 275
More than 300+ 50 75 25 25 5 45

Average Deal Size in INR

Number of beds\Type of Hospital Single Specialty Multi-specialty Nursing Homes Charity Hospitals Corporate Chains Day Care Centres
30 to 100 500,000 1,000,000 200,000 1,000,000 2,000,000 200,000
100 to 300 2,000,000 3,000,000 700,000 2,000,000 3,000,000 500,000
More than 300 3,000,000 5,000,000 1,000,000 3,000,000 5,000,000 1,000,000

Market Potential
Number of beds\Type of Hospital Single Specialty Multi-specialty Nursing Homes Charity Hospitals Corporate Chains Day Care Centres
30 to 100 307,000,000 245,000,000 231,000,000 95,000,000 38,000,000 447,000,000
100 to 300 690,000,000 813,000,000 290,500,000 356,000,000 27,000,000 137,500,000
More than 300 150,000,000 375,000,000 25,000,000 75,000,000 25,000,000 450,000,000
Total 1,147,000,000 1,433,000,000 546,500,000 526,000,000 90,000,000 1,034,500,000

Total Market Potential - 4,777,000,000