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McGraw-Hill/Irwin Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.

14-3
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14-4

The Tree of Business Life: Time

Customers Form Sales Territories

Elements of Time and Territory Management
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14-5
T
T T
T T T T
T T T T
Builds
Relationships
Guided by The Golden
Rule :

View your territory as a business

Treat customers differently depending on their needs
 Value the customer’s time

Realize that how you spend your time determines your life

Use your life to serve others and enjoy a wonderful, fulfilling life

Seek, knock, ask, serve, and see that ethical service build true relationships


A sales territory comprises a group of customers or a geographical area assigned to a salesperson.
14-6

Exhibit 14-1: Reasons Companies Develop and Use Sales Territories
14-7

Why Sales Territories May Not Be
Developed

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 areas.
14-8

Exhibit 14-2: Elements of Time and
Territory Management for the Salesperson
Salesperson’s territory’s sales quota
14-9

 The salesperson’s manager typically establishes the total sales quota.

Proper territory management by the salesperson is an important of reaching the sales quota.
14-10

Exhibit 14-2: Elements of Time and Territory
Management for the Salesperson, cont…
Salesperson’s territory’s sales quota
Account analysis
14-11


The undifferentiated selling approach (Exhibit
15-3)

The account segmentation approach (Exhibit
15-6)

ELMS system

80/20 principle

Multiple selling strategies

Multivariable account segmentation (Exhibit
15-7)
14-12

14-13
Exhibit 14-3: Undifferentiated Selling
Approach
Slide 15-11

Exhibit 14-4: Account Segmentation Based on Yearly Sales
14-14

14-15
Exhibit 14-5: Basic Segmentation of
Accounts

14-16
Exhibit 14-6: Account Segmentation
Approach
Slide 15-11

14-17
Exhibit 14-7: Multivariable Account
Segmentation
Slide 15-11

Exhibit 14-2: Elements of Time and Territory
Management for the Salesperson, cont…
Salesperson’s territory’s sales quota
Account analysis
Set account objectives and sales quotas
14-18

Develop Account Objectives and Sales
Quotas

Sales volume quotas

Profit quotas

Expense quotas

Activity quotas

Customer satisfaction scores
14-19

Exhibit 14-2: Elements of Time and Territory
Management for the Salesperson, cont…
Salesperson’s territory’s sales quota
Account analysis
Set account objectives and sales quotas
Territory-time allocation
14-20


Seven basic factors to consider:
1.
Number of accounts in the territory
2.
Number of sales calls made on customers
3.
Time required for each sales call
4.
Frequency of customer sales calls
5.
Travel time around the territory
6.
Non-selling time
7.
Return on time invested
14-21


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 do not increase sales.

The relationship of sales volume to sales calls is the sales response function of the customer to the salesperson’s calls.
14-22

Exhibit 14-8: Account Time Allocation by
Salesperson
* every 3 months
14-23


Time is a scarce resource.

Break-even analysis

The management of time:

Plan by the day, week, and month

Qualify the prospect

Use waiting time

Have a productive lunchtime

Records and reports
14-24

14-25

14-26
Exhibit 14-11: Location of Accounts and
Sequence of Calls

14-27
Exhibit 14-10: Daily Customer Plan
(cont…)

14-28
Exhibit 14-11: Location of Accounts and
Sequence of Calls (cont…)

14-29
Exhibit 14-10: Daily Customer Plan
(cont…)

Exhibit 14-11: Location of Accounts and
Sequence of Calls (cont…)
14-30
= small accounts

14-31
Exhibit 14-10: Daily Customer Plan
(cont…)

Exhibit 14-11: Location of Accounts and
Sequence of Calls (cont…)
= extra large accounts
14-32
= small accounts

14-33
Exhibit 14-10: Daily Customer Plan
(cont…)

Exhibit 14-11: Location of Accounts and
Sequence of Calls (cont…)
= extra large accounts
= large accounts
14-34
= small accounts

14-35
Exhibit 14-10: Daily Customer Plan
(cont…)

Exhibit 14-11: Location of Accounts and
Sequence of Calls (cont…)
= extra large accounts
= large accounts
= small accounts
14-36
= best prospects

14-37
Exhibit 14-10: Daily Customer Plan
(cont…)

Exhibit 14-11: Location of Accounts and
Sequence of Calls (cont…)
= extra large accounts
= large accounts
= medium accounts
= small accounts
14-38
= best prospects

14-39
Exhibit 14-10: Daily Customer Plan
(cont…)

Exhibit 14-11: Location of Accounts and
Sequence of Calls (cont…)
= extra large accounts
= large accounts
= medium accounts
= small accounts
14-40
= best prospects

Exhibit 14-2: Elements of Time and Territory
Management for the Salesperson, cont…
Salesperson’s territory’s sales quota
Account analysis
Set account objectives and sales quotas
Territory-time allocation
Customer sales planning
14-41


A sales-call objective

A customer profile

A customer benefit program

Selling strategies must be developed for individual customers and affect:

FABs

Marketing plans

Business propositions

Suggested orders

Sales presentations
14-42

Exhibit 14-2: Elements of Time and Territory
Management for the Salesperson, cont…
Salesperson’s territory’s sales quota
Account analysis
Set account objectives and sales quotas
Territory-time allocation
Scheduling and routing Customer sales planning
14-43


Some organizations determine strict formal route designs for their sales people to:

Improve territory coverage

Minimize wasted time

Establish communication between management and the sales force in terms of location and activities of individual salespeople

Careful planning of route:

A route can be planned using a road map and map pins that indicate account size by pin color
14-44

14-45

Exhibit 14-13: Three Basic Routing Patterns

Straight-Line Pattern First call
Work back

Cloverleaf Pattern

Major-City Pattern
14-46
Each leaf out and back the same day
(1 = Downtown)

Exhibit 14-2: Elements of Time and Territory
Management for the Salesperson, cont…
Salesperson’s territory’s sales quota
Account analysis
Set account objectives and sales quotas
Territory-time allocation
Territory and customer evaluation
Scheduling and routing Customer sales planning
14-47

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.
14-48


Did the salesperson meet sales quotas?

Sales volume

Profit

Expense

Activity

Customer satisfaction
14-49

Exhibit 14-15: Net Sales by Customer and
Call Frequency: May 1, 2005
14-50

Exhibit 14-2: Elements of Time and Territory
Management for the Salesperson, cont…
Salesperson’s territory’s sales quota
Account analysis
Set account objectives and sales quotas
Territory-time allocation
Territory and customer evaluation
Scheduling and routing Customer sales planning
14-51


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.
14-52

Summary of Major Selling Issues, cont…

Companies develop and use sales 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.
14-53

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McGraw-Hill/Irwin Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.