Chapter 15 TIME, TERRITORY, AND SELF-MANAGEMENT: KEYS TO SUCCESS Main Topics: The tree of business life: Time Customers Forms Sales Territories Elements of time and territory management THE TREE OF BUSINESS LIFE: TIME Managing time is one of the most important factors in selling. Time is money. Why? cause it is limited. Time is a measure in which events can be ordered from the past through the present into the future, and also the measure of durations of events and the intervals between them. We need to know how to effectively use time. There is only so much time in a day, week, month and year. People spend time doing what are the most important things to do in their life. That’s why we are living, because we have purpose. We are living because we have so many tasks to do every time we wake up in the morning. We have so many challenges to face in life. We need purpose in our life that’s why we are existing and living, in order for our job to have guidance. How we spend our time determines our lives. It influences the level of our success in sales and in school. Time encompasses the time spent with customers and our life activities. Using ethical service as a guide for actions allows one person to spend time doing what one loves. It allows you to find your purpose. It allows you to find your worth. It allows you to know why we are living. CUSTOMERS FORMS SALES TERRITORIES A sales territory is the customer group or geographic district for which an individual salesperson or sales team holds responsibility. Territories can be defined on the basis of geography, sales potential, history, or a combination of factors. Companies strive to balance their territories because this can reduce costs and increase sales. Reasons Companies Develop and Use Sales Territories To obtain thorough coverage of the market. To establish each salesperson's responsibilities. To evaluate performance. To improve customer relations. To reduce sales expense. To allow better matching of salesperson to customer needs. To benefit both salespeople and the company. Although there are reasons why we developed counter part of it is there are also reasons why we do not develop sales territories. Salespeople may be more motivated if not restricted by a particular territory. The company may be too small to be concerned with segmenting the market into sales area. 1. A salesperson is an individual who sells goods and services to other entities. The successfulness of a salesperson is usually measured by the amount of sales he or she is able to make during a given period and how good that person is in persuading individuals to make a purchase. If a salesperson is employed by a company, in some cases compensation can be decreased or increased based on the amount of goods or services sold. A salesperson quota goals may involved (1) sales volume quotas, (2) profit quotas, (3) expense quotas, (4) activity quotas and (5) customer satisfaction scores. 2. Account analysis is identifying accounts and their varying levels of sales potential. There are two general approaches to account analysis these are the undifferentiated selling approach and the account segmentation approach. a. The Undifferentiated Selling Approach The salesperson uses this when an organization see the market as similar and the selling strategies are designed and applied equally to all accounts. Mass marketing is used to effect attitude change to as wide an audience as possible. Often this would take the form of selling a product like toothpaste. Toothpaste isn't made specially for one consumer and it is sold in huge quantities. A company or individual who manufactures toothpaste wishes to get more people to buy their particular brand over another. The goal is when a consumer has the option to select a tube of toothpaste that the consumer would remember the product which was marketed. Mass marketing is the opposite of niche marketing, where a product is made specially for one person or a group of persons. Other products of mass marketing are furniture, artwork, automobiles, residential communities, fizzy drinks and personal computers. Typically, things which are perceived to be necessary/essential to the consumer are subject to mass marketing. Resources of mass marketing provide cost-effective marketing solutions for small and micro businesses, including start-ups. Even "products" like politicians and services from professions such as law, chiropractic and medicine, are subject to mass marketing. b. The Account Segmentation Approach This type of approach recognize that their territories contain accounts with heterogeneous needs and differing characteristics that require different selling strategies. c. Multivariable Account Segmentation 3. Set Account Objectives and Sales Quotas It is the third element for individual’s products and for current and potential accounts. Objectives might include increasing product distribution to prospects the territory or increasing the product assortment current customer’s purchase. (1) Sales volume quotas (2) Profit quotas (3) Expense quotas (4) Activity quotas (5) Customer satisfaction scores 4. Territory –time allocation This is the element we will know on how salespeople’s time allocated within territories. Time allocation is the time spent by the salesperson traveling around the territory and calling on accounts. I. Basic factors to consider: Number of accounts in the territory Numbers of sales calls made Time required for each sales calls Frequency of customers sales calls Travel time around the territory Non-selling time Return on time invested II. Sales Response function The salesperson 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 does not increase sales. The relationship of sales volume to sales calls is the sales response function of the customer to the salesperson call. III. Return on Time Invested Time is a scarce resource Breakeven analysis The management of time A. Plan by the day, week, and month B. Qualify the prospect C. Use waiting time D. Records and reports 5. Customer Sales Planning Developing a sales-call objective, a customer profile, and a customer benefit program including selling strategies for individual customers. You need to do the following for each sales call: Develop sales call objectives Create customer profile Create customer benefit plan Select FABs Develop marketing plan Develop business proposition Develop suggested order Develop your sales presentation 6. Scheduling and Routing Scheduling is establishing a fixed time for visiting customer’s business while routing is the travel pattern used in working a territory. Strict formal route designs enable the company to: Improve territory coverage Minimize wasted time Establish communication between management and sales force in terms of location and activities of individual salespeople. Carefully plan your route Using the Telephone for Territorial Coverage Satisfy part of the service needs of accounts by telephone Assign smaller accounts that contribute less than 5 percent of business to mostly telephone selling Do prospecting, marketing data gathering, and call scheduling by telephone Carefully schedule personal calls to distant accounts 7. Territory and Customer Evaluation Territorial evaluation is the establishment of performance standards for the individual territory in the form of qualitative and quantitative quotas or goals. Summary of Sales of Selling Issues How salespeople invest their sales time is a critical factor that influences territory sales. Proper time and territory management is an effective method for the salesperson to maximize territorial sales and profits. A sales territory comprises a group of customers or a geographical area assigned to a salesperson. Companies develop and use sale territories for a number of reasons Performance can be monitored when territories are established There are also disadvantages to developing sales territories. Time and territory management is continuous for a salesperson – it involves seven key elements.