Territory Design
Territory Design Procedures
•
What are triggering events?
•
The Buildup Method -- Six steps (11-1)
1. Select control units
•
Census tracts -- good for dividing cities
•
Counties - convenient and data readily available
2. Choose starting points
•
Salesperson’s home
•
Large customer - cut transportation cost
Territory Design
Computer Based Territory Designs
•
Computers save time
•
Need location & number of customers & starting
points
•
Program options
–
minimize moment of inertia
–
Graph data & draw boundaries -- not optimal
–
design optimal territories -- expensive
Territory Design
In-Class Exercises 11-1
1. Why do companies redesign territories?
2. In this role play, what were the reasons
for redesigning territories?
3. What problems are likely to arise when
territories are redesigned?
Territory Design
In-Class Exercises 11-1
5. What mistakes were made in territory
realignment?
6. What options are available?
7. Should the company give in to Hughes and not
change his territory?
8. What if seven other people in the district come
to you asking for the same deal as Hughes?
Territory Design
Territory Design Procedures
3. Determine Allocation Criteria
•
Territory balance -- effect on morale
•
Customer balance - distribute commission
•
Potential balance - share business growth
•
Size balance - reduce transportation costs
4.
Combine Adjacent Control Unit (11-3)
5. Compare Sales Territories
•
Mountains, roads, population center locations?
Figure 11-1:
Territory Design Process
1 Select geographic control units 2 Decide on allocation criteria 3 Choose starting points 4Combine control units adjacent to starting points
5
Compare territories on allocation criteria
6
Assign salespeople to new territories Events triggering sales
terrirtory adjustments
Mergers
Division consolidation Division split
Sales force turnover Plant relocations Product line changes
The numbers in ach county are
population figures and are
a measure of potential.
Three Kentucky Sales Territories
TENNESSEE
VIRGINIA WEST VIRGINIA INDIANA
ILLINOIS
OHIO Major super highways
The numbers in ach county are
population figures and are
a measure of potential.
Three Kentucky Sales Territories
TENNESSEE
VIRGINIA WEST VIRGINIA INDIANA
ILLINOIS
OHIO Major super highways
Table 11-2
Geographic Control Units Used in Territory Design
Table 11-2
Comparing Three Kentucky Sales Territories
Potential as
Measured by
Territory
Population
Number of Counties
Sales Territory Mapping Programs
Vendor Package Description Price
GeoQuery Corp. GeoQuery Interactive maps for travel planning $295 and territory analysis. Direct links to
contact management program.
TTG,Inc. STARmanager Territory mapping system that integrates $995 sales and marketing data for interactive
territory analysis, realignment, and monitory.
Sammamish GeoSight Geographic informaitno systems for sales $1,850 Data Systems Professional territory creation and management.
Includes address matching.
Territory Design
Territory Design Procedures
•
Talley’s Workload Approach
–
No starting points
–
Equates work to be done
–
May lead to imbalance on size (11-4)
–
Often raises travel costs
–
Good when reps are on salary
