N5 Sales Management


3. Factors influencing sales territory design (the number and size of the territories)


3.1 Nature of the sales job


Depending on the type of selling job of the particular salesperson, substantial differences may arise in territory size and number of customer/prospects. A route salesperson, for example, a salesperson for Coca-Cola, only gets re-orders, sometimes simply by means of a e-mail. Such a salesperson can have a much bigger area than a salesperson selling in the industrial market, because he must visit the customers personally and more often and plan for every meeting.


3.2 Nature of the product


The type of product (convenience, shopping, speciality or industrial goods) or service being sold will also influence sales territory design and this factor must be considered in conjunction with the nature of the sales job.


3.3 Stage of market development


If a market is still in the growth stage, the marketer will want to expand his representation as much as possible to take advantage of the growing demand. To achieve this, he would strive to establish as many territories as possible.


3.4 Intensity of market coverage


In case of a policy of market penetration, in which case the business would want to ensure total market coverage, they will design the maximum number of territories. By adopting a skimming strategy, not such intense market coverage is required and the company will design less territories.


3.5 Intensity of competition


If competition is intense in a particular market, customers will have to be called on more frequently; thus, smaller and more territories will be needed.


Activity 1 1.* Name five benefits derived from establishing sales territories. 2. List the five steps (procedures) in designing sales territories. 3. List five factors influencing sales territory design. 4. Briefly discuss three problems that are sometimes experienced during sales territory design.


*Naming five benefits can also be phrased as briefly discuss. The headings used as full sentences are seen as briefly discussing it.


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