This document discusses keys to successful sales territory management including defining territories, setting sales quotas, analyzing accounts, allocating time to territories, and calculating return on time invested. Territories group customers or geographical areas and are assigned to salespeople. Quotas may involve sales volume, profit, expenses, activities, and customer satisfaction. Account analysis includes differentiation by annual sales, priority levels, or multiple variables. Time allocation considers accounts, calls, travel, and non-selling activities. Return on time is calculated using break-even analysis of fixed costs, gross profit percentage, and sales required to cover costs.

1. Time, Territory, and Self-
Management: Keys to Success
Chapter
15

2. 15-2
Customers Form Sales Territories
 A sales territory comprises
a group of customers or a geographical area
assigned to a salesperson

3. 15-3
Exhibit 15.1: Reasons Companies
Develop and Use Sales Territories

4. 15-4
Elements of Time and Territory
Management
 Salesperson’s sales quota (goals) may
involve:
Sales volume quotas
Profit quotas
Expense quotas
Activity quotas
Customer satisfaction scores

5. 15-5
Elements of Time and Territory
Management, cont…
 Account analysis:
The undifferentiated selling approach (Exhibit 15-3)
The account segmentation approach (Exhibit 15-6)
ELMS system
80/20 principle
Multiple selling strategies
Multivariable account segmentation (Exhibit 15-7)

6. 15-6
Exhibit 15.3: Undifferentiated Selling
Approach
Slide 15-11

7. 15-7
Exhibit 15.4: Account Segmentation
Based on Yearly Sales
E.L.M.S.

8. 15-8
Exhibit 15.6: Account Segmentation
Approach
Slide 15-11

9. 15-9
Exhibit 15.7: Multivariable Account
Segmentation
Slide 15-11

10. 15-10
Elements of Time and Territory
Management, cont...
 Territory-time allocation
Basic factors to consider
Number of accounts in the territory
Number of sales calls made on customers
Time required for each sales call
Frequency of customer sales calls
Travel time around the territory
Nonselling time
Return on time invested

11. 15-11
Elements of Time and Territory
Management Cont…
 Territory-time allocation
Sales response function
Invests sales time in direct proportion to the actual or
potential sales that the account represents
The most productive number of calls is reached at the
point at which additional calls do not increase sales
The relationship of sales volume to sales calls

12. 15-12
Exhibit 15.8: Account Time
Allocation by Salesperson
* every 3 months

13. 15-13
Return on Time Invested
 Break-even analysis
Salesperson’s Fixed Costs/Gross Profit %
Direct Costs = Salary – (Transportation +
Expenses)
Gross Profit % = Gross Profit / Sales
Gross Profit = Sales – Cost of Goods Sold
If salesperson sells X amount of merchandise, it
covers the direct costs
Sales territory is a cost and revenue generating
profit center

14. 15-14
Return on Time Invested
 Break-even analysis
Per Hour
Cost Per Hour/Gross Profit %
Cost Per Hour = Direct costs/Yearly Hours worked
Salesperson must sell $$ per hour in goods/services
to break even