SALES TERRITORY

Sales Territory

SALES TERRITORY

Cont….

Territory Management

The following diagram outlines the activities of territory management

Trade relations/Dealer relations

Potential business

Coverage

Reports

Territory size

Portfolio of accounts

Selling techniques

Customer satisfaction

Selling abilities

Activities of

Territory

Management

SALES TERRITORY

Cont….

Why Establish Sales Territories?

A company can develop and use sales territories for various reasons. Some of

the reasons are as follows:

To obtain entire coverage of the market

To establish a salesperson’s responsibility

To evaluate performance

To improve customer relations

To reduce sales expenses

To allow better matching of salesperson to customer

To benefit salespeople and the company.

SALES TERRITORY

Cont….

Factors to be Considered when Designing Territories

In setting up or designing sales territories, these four steps must be followed:

1. Selecting a basic geographical control unit

2. Determining sales potentials in control unit

3. Combining control units into tentative territories

4. Adjusting for coverage difficulty and reallocating tentative territories.

The two basic approaches commonly used for designing sales territories are discussed below. Market Build-up Approach

In this approach, an estimation of the present and potential products/services demand is made by looking at how the market is built up, who are its

present/potential users, how much do they consume and at what frequency. The Workload Approach

This approach is designed by WJ Talley on the basis of the workload performed by salespersons.

SALES TERRITORY

Cont….

Assigning to Territories

Some salespeople can handle large territories and the travel associated with

them, some territories require experienced salespeople, and some are best

suited to new people. There are a few factors a manager needs to consider

when assigning both new and experienced people to territories.

In today’s complex selling situation, the presence of a well-thought-out daily

and weekly route plan is required for effective management. The following

may be considered basic route patterns of a territory.

Straight Line Pattern Base First Call

C

C

C

SALES TERRITORY

Clover Leaf Pattern Major City Pattern

CC

C

C

C

CC

C

Base

2 3

4 5

1