TERRITORY

DEVELOPMENT
AND TIME
MANAGEMENT
CHAPTER # 7
LEARNING OUTCOMES

• Understanding the nature and scope of territory management

• Reasons for establishing & revising territories
• Describe the process of territory design after discussing the basis of
territory formation
• List & discuss routing patterns & scheduling
• Understanding how Sales Personnel can use their time productively via
the DO’s and DON’T’s
• Explain the concept of Time Management & how it relates to sales
personnel’s working
• Understanding how to manage a territory effectively and efficiently
 KEY WORDS YOU NEED TO
KNOW BEFOREHAND

• Load Factor: number of actual and potential customers assigned to a given

salesperson.
• Account potential: share of an account’s business that the firm can reasonably
expect to attract
• Routing: establishing the sequence of locations a salesperson will visit.

• Scheduling: sequencing of appointments or unannounced visits for maximum

contact time.
 WHAT IS A SALES TERRITORY?

A sales territory is defined as group of present and potential customers

assigned to an individual salesperson, a branch , a stockiest , a distributor at
a given point of time.

Although customer groupings play a role in setting boundaries, sales

territories are primarily based on geographical considerations.
 TERRITORY MANAGEMENT

Territory management can be defined as the planning, implementation, and

control of salesperson’s activities with the goal of realizing the sales and profit
potentials of the assigned territories.

Sales representatives are viewed as scaled down sales managers since they
bear the ultimate burden of managing parts of the customer base.
 NEED FOR TERRITORY
MANAGEMENT
Reasons for, and benefits of, Sales Territories
REASONS BENEFITS

Customer – Related

Provide intensive market coverage Produce higher sales

Provide excellent customer service Produce higher satisfaction
Salesperson – Related

Foster enthusiasm Lead to less turnover

Facilitate performance evaluation Offer rewards related to efforts
Managerial

Enhance control Reduce expenses

Coordinate promotion Give more returns
BASIS OF TERRITORY DESIGN &
DEVELOPMENT
Equalization of territorial potential:
The underlying principle when drawing territories is workload
and opportunity equalization – all territories should possess
equal challenges n opportunities to salespeople.

Bases used in creating territories:

 geography,
 potential,
 service requirement,
 workload.
 BASIS OF TERRITORY DESIGN &
DEVELOPMENT
 Geography: the establishment of geographic territories – the most frequently used basis – is simple because it tends
to adopt existing geopolitical boundaries such as states, countries, nations, cities etc.

 Potential: refers to splitting up a firm’s customer base according to sales potential. The procedure is simple, first, the
management has to estimate the sales potential for the entire company, next, it has to determine what sales potential
will be appropriate for the average salesperson.

 Servicing requirement: an approach wherein territories are formed on more refined form – customer base
constituting the equal potential in territories is taken into account. Accounts are classified into A, B n C types.

 Workload: it not only considers individual sales potentials n servicing requirements in creating territories, but also
reflects differences in coverage difficulty caused by topographical features, account locations, competitive activity n
so forth.
PROCESS FOR TERRITORY DESIGN
Designing sales territories involves breaking down a firm’s customer base
so that accounts can be well served by individual sales persons.

Select Basic Analyze Determine

Control Units Workload Basic Territories

Customer Assign
Evaluate,
Contact Plan Territories
Revise if Needed
PROCESS FOR TERRITORY DESIGN
1. Select Basic Control Units
• States
• Counties
• Cities and zip-code areas
• Metropolitan areas
• Trading areas
• Major accounts
PROCESS FOR TERRITORY DESIGN
2. Analyze Salesperson’s Workload
Workload is the quantity of work expected from sales personnel.
Three of the main influences on workload involve the:

a) Channel mix; Retail to W/S accounts ration

b) Intensity of market coverage; Selective, Exclusive or Intensive
c) Type of products sold; Convenience, Novelty of Speciality
PROCESS FOR TERRITORY
DESIGN
3. Determine Basic Territories

I) Forecast sales and determine sales potentials.

II) Determine the sales volume needed for each territory.
III) Determine the number of territories
Breakdown Approach
Equalized workload

IV) Tentatively establish territories.

V) Determine the number of accounts
VI) Finalize the territories, and draw the
boundary lines.
 PROCESS FOR TERRITORY
DESIGN
Breakdown Method Equalized Workload Method
The breakdown approach uses factors This method uses the number, location, and
such as sales, population, or number of size of customers and prospects to determine
the frequency of sales calls and amount of time
customers. a call takes by using such data as:
• Time required for each sales call.
Sales Force Size = Forecasted Sales
• Frequency of sales calls per given customer.

• Time intervals between sales calls.

Avg. Sales per Salesperson
• Travel time around territories.

• Non selling time

PROCESS FOR TERRITORY
DESIGN
4. Assign Territories

Some salespeople are placed in large territories with extensive

travel time allotted

Some territories require experienced salespeople; some are best for

new people.

Some people want to live in metropolitan areas; others prefer

territories with smaller cities.

LIKE SR – LIKE TERRITORY!!

PROCESS FOR TERRITORY
DESIGN
5. Customer Contact Plan
The customer contact plan involves scheduling sales calls and routing a salesperson’s
movement around the territory.
Date City Location / Dealer

Jan 23 Karachi Gulshan Distribution

Jan 24 Karachi Khalid Bin Waleed

Distribution
Jan 25 Karachi North Karachi
Distribution
Jan 26 Karachi SITE Area Distribution

Jan 27 Karachi Clifton Distribution

 PROCESS FOR TERRITORY
DESIGN
Three Basic Routing Patterns
1. Straight Line 2. Cloverleaf Route 2. Hopscotch Pattern

First call c c
c c c
c c
c c c Base c c c
c c c ccc c
c cc c
c c Eachback
leaf out and
the same day
c c

Scheduling

Allocation of appropriate time Accommodation of time related Ensuring the sales calls for
activities such as waiting and travel
for each activity time
each day are fulfilled
Common Territory management problems and Remedies
PROBLEMS REMEDIES

Inadequate coverage Split Territories

Inadequate size Enlarge Territories
Revision Prepare Salespeople
Shifting Accounts Revise Territories
Direct Accounts Clarify at Hiring
Inadequate Support Assist Salespersons
Territory Jumping Eliminate practice
Overlapping Territories Minimize crossovers
Selling Cost Variation Review cost figures
High Turnover Rectify causal factor
 DO’S AND DON’TS FOR SALES
PERSONNEL
DO’s: DO NOTs:

- Prospecting New Accounts - Spending substantial time

on small favorite accounts
- Economical & Profitable
Coverage - Encroaching other’s
territories
 TIME MANAGEMENT

Time management: at the territorial level has as its objective the structuring of
a salesperson’s scarce time resources in such a way as to maximize productive
time and minimize unproductive time.

Three keys to managing time well are

Planning,
Organizing, and
Discipline
 TIME MANAGEMENT
Taxonomy of time utilization…
Uses of a salesperson’s time Classification

Time spent in:

Customer contact Productive
Planning
Support

Time spent in:

Travel Unproductive
Waiting
 IMPORTANCE OF TIME
MANAGEMENT
Better Market Coverage Reduce Selling Costs
• Careful spending of money based on account • Identify the decision maker & approach him
directly
• Use of promotional material and appropriate software
• Approach should be professional
• Proportional spending of time based on size of account

• Profitability of each customer to be calculated

Improved Customer Service Accurate Evaluation of Salesforce

• Maintaining good relations through proper follow up • Analysis of the Sales performance
• Sales force automation (SFA): Its a technique that
• Learn about Salespersons Strengths & Weaknesses
automates business tasks such as inventory control,
sales processing, and tracking of customer interactions,
as well as analyzing sales forecasts and performance.
6 steps
to effectively MANAGE your sales territory
 6 1
Review and Understand
realign your
customers

Leverage
5 your Prioritize 2
network

Remember the Master your

big picture rotation
plan
4 3
 1
6
Review and
Understand
realign your
customers
Leverage
5 your Prioritize 2
network
Segment your customer base
Remember the Master your
big picture rotation
plan … to get a concrete view of
4 3 the territory you are serving.

… to give the appropriate

amount of attention to different
customer types.
 Classify your customer
1 database
Understand
your What types of customer
accounts do you already
customers
have?

What prospects do you

Prioritize 2 want to service in the
future?

ter your Which clients need to be serviced

ion plan
more frequently?
3

What is their preferred method

of communication?
 6 1

Review and Understand

realign your
customers

5
Leverage
your Prioritize 2
network

Remember the Master your

big picture rotation
plan
4 3

Managing sales territories is a balancing act between time & exploiting opportunities

MAKE SURE YOU USE YOUR TIME WISELY

 Prioritize 2

Identify who requires MORE

or LESS attention

& Prioritize your schedule and

delegate efforts accordingly
 Focus on your most valuable
accounts
Invest your time in leads that are more Estimating sales potential for your
promising, so you don’t pursue a dead accounts is a good way to prioritize
end. your efforts and spending your time with
the right customers.
 SALES POTENTIAL
for your accounts will give an impression of their
maximum possible spending with your product

Try to find out:

How much are current customers spending on your

product(s)? What is their buying power?

Are there any “white spaces” that you can “fill”, i.e.
unrealised opportunities?

For estimating sales potential, consider employee count, industry

type, past sales, marketing momentum, growth opportunities, etc.
Keep in mind, that sales potential gives you a better understanding of
how much money a customer is likely to spend on your
products in the future.

Don’t assume you will capture all of

it!

It is not possible to accurately capture all

factors influencing a customer’s actual spending
the
the
in future.
 6 1

Review and Understand Once you have categorized your

realign your
customers clients, you can start tocraft a
master rotation
Leverage
5 your
network
Prioritize 2 schedule

Remember the
big picture

4
Master your
rotation
plan
3
 SIMPLIFY your
sales territory management
Map out your plan of attack,
a sequence of touching base
with your customers.

Follow a predictable
routine to establish
accountability checkpoints.

Solidify your schedule at the

REDUCE common beginning of the sales quarter.
“end-of-quarter” stress
 Disappointment
is a reality of sales.
6 1
Review and Understand
BUT "if you learn from defeat, realign your
you haven't really lost." customers
Zig Ziglar
Leverage
5 your Prioritize 2
network

Remember Master your

rotation
the big plan
3
picture

4
 Don’t sacrifice opportunities by mourning for that one
lost sale.

Move forward and get ready for your next deal.

If I only got ● Take rejection as a
that chance to do it
sale...
better next time
● There are always bigger
fish out there for you to
pursue
 6 1
Review and Understand
realign your
customers

Leverage
5 your Prioritize 2
network
Remember the Master your
big picture rotation
plan
4 3

The relationships you foster throughout your sales process are critical to sales
territory management.
“Loyal Cultivating bonds with customers could
eventually connect you with other potential LEADS.
customers,
they don’t just come If you pay enough attention to your existing clients, you
may ultimately strengthen your sales network &
back, they don’t simply contribute to your customer base.
recommend you,
they insist that their
friends BUSINESS
do
with you.”

Chip Bell
 6 1
Understand
Review and your
customers
realign
Leverage
5 your Prioritize 2
network

Market dynamics Remember the Master your

big picture rotation
cannot be kept outside plan

the borders of your sales territory. 4 3

Therefore, you will need to review

& occasionally refine your plan of
action
Respond to changing business or market situations, such as
new product launches, new target markets, etc.

Who are your

Are you still on track strongest
to hit your overall customers?
goals?
What prospects do you
want to add to your
accounts?

What techniques
helped you to close
deals?

What is the
best selling
product?
COCA COLA BEVERAGES
PAKISTAN LIMITED
(CCBPL) – TERRITORY
DESIGN
BASIS FOR TERRITORY DESIGN

• Outlets
• Volume
• Geographical distance
 7

Territory Design T
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r
i
R t
e o
g r
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Z o e
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A e
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a
s
THANK YOU!