Sales Territories

-Prof Sudeep Chatterjee

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 Reasons for Sales Territories
To obtain thorough coverage of the market-
Proper coverage of territory can better achieve the
sales potential of the markets through territory
analysis, identifying and classifying customers.
To establish a salesperson’s responsibility-
Maintaining & generating sales volume, by knowing
their customer locations and the frequency of visits
To evaluate performance-
Actual performance data can be collected, analysed,
& compared with expected performance goals on a
periodic basis to assess the level of success.
To improve customer relations-
Customer goodwill & increased sales can be
expected when customers receive regular calls.
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 Reasons for Sales Territories
To reduce sales expenses-
Designed to avoid duplication of efforts so lower
selling costs can be realised and company profits
improved.
To allow better matching of salesperson to
customer-
Hiring & training sales persons to meet the
Requirements of the customers in specific territory.
To benefit salesperson and the company-
Aids the salesperson in carrying out the firm’s sales
strategies

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Factors in Designing Sales Territories
Sales Force objectives- (contribution to profits,
sales/ cost ratios, market share)
Designing on the basis of geographical
boundaries/customers
Analyse Sales force work loads
Distribution strategy

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Factors in Designing Sales Territories
Type of products sold
Scheduling & routing
Evaluation & Revision of sales territories
The bottom line

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 Scheduling & Routing
Establishing a time schedule (day and hour) when a
salesperson will visit a customer’s place of business.
Routing is the travel pattern the sales person uses in
working a territory. A formal route design enables a
salesperson to-
Improve territorial coverage
Minimise time wastage
Establish communications between management
and the sales force in terms of the location and
activities of individual salespeople.
A good route plan requires determining exact day
and time of sales calls for each account, approximate
waiting time, sales time, miscellaneous time,
checking inventory, and travel time between
accounts. Effective routing & scheduling increases
productivity
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 Scheduling & Routing
The purpose of scheduling & routing is to improve
sales coverage. The elements consist of-
 Means & methods of transportation
 Category of customers
 Numbers & Location of Customers
 Call frequency for contacting customers
Wastage of time due to backtracking, non selling
issues and travel is minimised. Brings better control,
checking variance & discrepancies by supervisors
making unannounced visits to the market. However,
being a dynamic process changes may occur due to
account new prospects, reclassifications, competition
activity, and road conditions.
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 Adjusting sales Territory
Determine the No., location and size of customers
& prospects
Estimate the time required for each sales call
Determine the length of time between calls
Decide the call frequencies
Calculate the number of calls possible within a
given period
Adjust the number of calls possible during a given
period by the desired call frequency for different
class of customers
Check out the territory with sales people who have
worked in each area and make final adjustments.

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