As businesses have become more analytical in today’s data-driven market, there’s been a surge in sales organizations investing in territory management software to enhance their sales performance.
This means businesses are looking for ways to make sales data easier to digest. They want to be able to analyze the information and gather insights about market gaps and over-serviced territories. But what exactly is sales territory management and alignment? Firstly, we need to define a sales territory:
What is a sales territory?
A sales territory is the customer group or geographical area for which an individual salesperson or a 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.
What is sales territory management?
Sales territory management is the optimization and improvement of territory alignment. The goal is to balance territories so sales reps’ time and resources are used effectively to maximize the productivity of your sales team. Sales territories are often unbalanced, which can lead to under-served areas and resources wasted on low potential zones.
What is sales territory alignment?
Territory alignment is a common sales productivity technique whereby specific geographical or regional sales territories are assigned to a specific salesperson. The basic building blocks are usually states, counties, cities or ZIP code areas. Territory balancing ensure that sales territories are equally distributed among the sales team.
Poor sales territory management can lead to unbalanced territories, which are a headache for sales teams. If a sales rep’s territory is too large or their workload too heavy, they can’t effectively cover all customers and prospects. Conversely, a sales rep whose territory is small or sparsely populated can end up wasting their potential on low priority clients, leading to under-utilized sales resources and an unmotivated workforce. As a result, the company loses money, time and potential customers. Balanced territories on the other hand, are proven to be effective and efficient, allowing you to get the most from your sales team by fairly allocating sales opportunities. Sales territory management software ensures efficient coverage of sales territories, improving lead development, increasing responsiveness to emerging trends, and balancing the workloads of employees, thereby maximizing the company’s performance and profits.
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