WHAT IS A SALES TERRITORY

• According to B.R.Canfield, “A sales territory is a

geographical area containing present and potential
customers who can be effectively and economically
served by a single salesman, branch dealar or
distributor.”

• A sales territory is a composed of a group of

customers or a geographic area assigned to a
salesperson.
WHY ESTABLISH SALES TERRITORIES?
• To obtain thorough coverage of the market
• To establish a salesperson’s responsibility
• To evaluate performance
• To improve customer relations
• To reduce sales expense
• To allow better matching of salesperson to
customer
• To benefit salespeople and the company
DESIGNING SALES TERRITORIES
• Select basic control unit
• Analyze workload
• Determine basic territories
• Assign territories
• Customer contact plan
• Evaluate, revise if needed
Characteristics
Potential customers
Different groups of customers
Geographical area assign to a
salesperson
Effectively & Economically
Objectives of sales territories
To facilitate effective sales planning.
To cover & manage the entire market.
To assign salesman responsibility .
To reduce the selling costs.
To facilitate coordination in marketing functions.
For marketing research.
Development of fair competition.
To improve the customer relations.
Independent work area for each salesman.
Reasons for Establishing sales territories

To provide proper market coverage.

To control selling expenses.
To assist evaluating performance sales
personnel.
To contribute to sales force morale, and
To help in the coordination of personnel selling
& advertising efforts.
Factors affecting the size of
sales territories
Nature of the products
Demand for the product
Mode of distribution
Selling expenses
Transport & Communication facilities
Govt. policy
Density of population
Continue…….

Market potentialities
State of competition
Abilities of salesman
Firm’s policies
Economic condition prevailing in the country
Factors to be kept in mind while
Allocating sales territories

Even distribution coverage/ uniform coverage

Elimination of duplication of activities
Equal opportunity
Flexibility in allocation
Controllable
Capable of comparative study
Continue…….

Uniformality in income
Economical
Efficient performance
Allocation to new salesmen
Routing &
Scheduling sales
personnel
Advantages of Routing & Scheduling
Routing & Scheduling plans improve better sales
coverage.
Fixation of call frequency rate.
Reduce wastage of time.
Advance appointment with the customers/
prospects.
Assists sales management for closer control.
Procedure for Setting up or Revising
Sales Territories

Selection of basic geographical control unit

Determining sales potentials on the basic units
Combining the basic units into tentative sales
territories
Adjusting and redistributing sales territories
Assigning sales territories to sales persons
 Thus, setting up sales territories
facilities the planning and control of
sales operations.
Well-designed territories assist to
improve market coverage and
consumer service expenses ratios,
secure coordination of personal
selling and advertising efforts, and
improve the evaluation of personal
performance.