What is Line Sales Organization?
The line sales organization is the most basic and oldest structure for a sales organization. The chain of command extends from the highest sales executives to the lowest level employees. Line authority is exercised by all executives.
Each subordinate is only accountable to one person at the next level up. Vertical authority lines go through the structure. Everyone on a given organizational level is self-contained from everyone else on that level. The burden of proof is always present. The responsible parties are thus charged with deciding whether or not to take action.
Why the line sales organizational structure is still in use? The suitability of the line sales department organization is of two basic reasons,
- It is widely used in smaller firms having limited divisions.
- It is also used in firms with smaller numbers of selling personnel, who cover a limited geographic area or sell a narrow product line.
This figure of the line sales organization shows that the sales manager is responsible for reporting to the general manager. Each assistant sales manager of each separate division is responsible to report the sales manager. Similarly, salespeople under each separate division are responsible for reporting to their immediate boss. There is no cross-communication between persons on the same level. For example, no communication between assistant sales manager division-1 and assistant sales manager division-2, or salespeople division-1 and salespeople division-2.
In the case of this organization, if salespeople want to have office contact, they have to go through the organization to the sales manager and back down through the assistant manager in charge of the office to the office staff.
Advantages and Disadvantages of Line Sales Organization Structure
- It is simple to use a structured line of authority and responsibility.
- The reporting system minimizes the problems of discipline and control.
- Definitive placement of authority and responsibility saves time in making policy changes in deciding new plans, and in converting plans into action.
- It develops a close relationship between salespeople and sales executives because of line structure.
- Administrative expenses remain low as this structure has few organizational levels.
- So much depends upon the departmental heads in this sales organization structure. And sometimes their outstanding ability and specifications needed for discharging their responsibilities may appear deficit and smooth functioning may be suspected.
- Even the head is an all-around expert, there is insufficient time for policymaking and planning because the rigidity of line structure requires a great deal of attention to be given to directions of sales operations.
- Sales results often appear disappointing because of the above weaknesses.
- This structure of sales organization proves inappropriate for rapidly growing businesses and for those with large sales staff because this business of the structure needs a series of administrative and executive levels.