This document discusses the management of sales territories. It defines a sales territory as a group of present and potential customers assigned to a salesperson, team, branch, dealer, or other marketing organization for a given period of time. Managing sales territories effectively has several advantages, such as ensuring better market coverage, utilizing the salesforce efficiently, controlling costs, and optimizing salespeople's time. The document outlines factors that influence modifying territories and different shapes territories can take. It also discusses strategic planning matrices to analyze opportunity levels and allocate resources accordingly.

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Chapter 6
Management of Sales Territory

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Sales territory
• a group of present and potential customers assigned to
an individual
• sales person, a group of sales person, a branch, a dealer,
a distributor or a marketing organization at a given
period of time

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Sales territory (contd.)
Advantages of designing a sales territory :
 it ensures better market coverage
 effective utilization of the sales force
 efficient distribution of workload among sales
people
 it is convenient to evaluate the performance of
sales people
 to control over the direct and indirect costs of the
sales function
 optimum utilization of sales time by sales people

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Designing sales territories
Select the basic geographic
control units
Decide on the criteria for
allocation
Decide on the starting point
Combine control units
adjacent to starting point
Compare territories on
allocation criteria and conduct
workload analysis
Assign sales force to new
territories
Factors influencing
the modifications of
a territory:
• mergers
• market
consolidation
• split in division
• sales force
turnover
• customer
relocations
• product life
cycle change
Modify
territorial
boundaries to
balance
workload and
potential

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Territory shapes
Circle
a/c distributed equally across
Central part to all areas
urban areas eg cars
Wedge
FMCG
Dense to rural area
Less travel time
Clover leaf
Randomly distributed
Careful planning to a clover area
on weekly basis

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Strategic Planning Matrix
Opportunity
Strategy
Opportunity
Strategy
Strategy
Strategy
Allocate a moderate level of resources to
maintain current advantage.
Either commit a minimal level of resources
to the account or consider abandoning the
account altogether.
The account offers stable opportunity since
the sale organization has differential
advantages to serving them.
Opportunity
Opportunity
The account offers little opportunity. Its
potential is small and the sales organization
is at a competitive disadvantage in serving it.
The account offers a good opportunity.
It has high potential and the sales
organization has a differential advantage
in serving it.
Commit high levels of sales resources to
take advantage of the opportunity.
The account may represent a good
opportunity. The sales organization needs to
overcome its competitive disadvantages and
strengthen its position to capitalize on the
opportunity.
Either direct a high level of sales resources
to improve the position and to take
advantage of the opportunity or shift
resources to other accounts.
Strong Weak
H
i
g
h
L
o
w

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7
New Territories..?
Use of Information Technology
 IT enabled services
 computer programmes
 simulation techniques
Sales territories