An approach to direct the sales force by designing a sales territory....

1. Designing A Sales Territory
Presented by -
Pranay Guha
Mrinal Roy
Souvik Roy
MBA Marketing
Techno India, Salt Lake

2. Sales Territory
 A geographical area consisting of group of present and potential
customers.
 Assigned to -
 an individual salesperson,
 a group of salesperson,
 a branch,
 a dealer,
 a distributor or,
 a marketing organization.
 At a given period of time.
 Basic unit of sales planning and control.

3. Advantages
 Better market coverage.
 Effective utilization of the sales force.
 Efficient distribution of workload among salespeople.
 Optimum utilization of sales time by salespeople.
 Enhances employees’ morale.
 Evaluate the performance of salespeople.
 Control over the direct and indirect cost of the sales function.

4. Territory Design Process
Factors influencing
the modifications of a
territory :-
 Mergers.
 Market
consolidation.
 Split in division.
 Sales force turnover.
 Customer
relocations.
 Product Life Cycle
changes.
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
Modify
territorial
boundaries
to balance
workload
and
potential

5. Computer Based Territory Designs
 Computers save time.
 Need location & number of customers & starting points.
 Geographic Information System (GIS)
 Combines multiple layers of information to provide in-depth
understanding of a sales territory.
 Elements of a complete GIS
-Software.
- Hardware.
- Data.
- Trained people.

6. Territory Design Procedures
 The Buildup Method -> Six steps .
1. Select Control Units
 Census tracts -- good for dividing cities.
 Countries - convenient and data readily available.
2. Determine Allocation Criteria
Territory balance -- effect on morale.
 Customer balance - distribute commission.
 Potential balance - share business growth.
 Size balance - reduce transportation costs.

7. Territory Design Procedures(Contd.)
3. Choose starting points
 Salesperson’s home.
 Large customer – cut transportation cost.
 Big city - convenient for services.
4. Combine adjacent control units
5. Compare sales territories
Mountains, roads, population center
locations.
6. Assign people to sales territories.

8. Geographic Control Units used in Territory Design
 Countries
 Cities
 States or Provinces
 Metropolitan Areas
 Zip Codes
 Census Tracts
 Customers

9. Territory Size and Workload Factors
Workload Factors Territory Size (Increase/Decrease)
 Nature of Job:
Lots of Pre-sale and Post-sale activity Decreases
 Nature of Product:
A frequently purchased product
A limited repeat-sale
Decreases
Increases
 Market Development Stage:
New Market-fewer accounts
Established Market-more accounts
Increases
Decreases
 Market Coverage:
Selective Coverage
Extensive Coverage
Increases
Decreases
 Competition:
Intensive
Limited
Decreases-until market is oversaturated
Increases