Sales and Distribution Management, 2e

Dr Tapan K. Panda, Great Lakes Institute of Management, Chennai Dr Sunil Sahadev, University of Sheffield, UK

Copyright 2011 Oxford University Press

Chapter 7: Management of Sales Territory

Chapter 7 Management of Sales Territory

Copyright 2011 Oxford University Press

Chapter 7: Management of Sales Territory

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

Copyright 2011 Oxford University Press

Chapter 7: Management of Sales Territory

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

Copyright 2011 Oxford University Press

Chapter 7: Management of Sales Territory

Designing sales territories

Factors influencing the modifications of a territory: mergers market consolidation split in division sales force turnover customer relocations product life cycle change product line change
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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

Chapter 7: Management of Sales Territory

Territory shapes

circle

wedge

Clover leaf

Copyright 2011 Oxford University Press

Chapter 7: Management of Sales Territory

Strategic Planning Matrix

Opportunity
H i g h
The account offers a good opportunity. It has high potential and the sales organization has a differential advantage in serving it.

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.

Strategy
Commit high levels of sales resources to take advantage of the opportunity.

Strategy
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.

L o w

Opportunity
The account offers stable opportunity since the sale organization has differential advantages to serving them.

Opportunity
The account offers little opportunity. Its potential is small and the sales organization is at a competitive disadvantage in serving it.

Strategy
Allocate a moderate level of resources to maintain current advantage.

Strategy

Either commit a minimal level of resources to the account or consider abandoning the account altogether.

Strong
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Weak
Chapter 7: Management of Sales Territory

Sales Territories

New Territories..?

Use of Information Technology

IT enabled services computer programmes simulation techniques

Copyright 2011 Oxford University Press

Chapter 7: Management of Sales Territory