by Sales territory optimization is the data-driven process of designing efficient, balanced regions that sales operations can service optimally. The method factors in workload, sales potential, geography, and other resources required to maximize revenue while minimizing costs. Optimizing sales territory involves using mapping software to ensure sales reps dedicate more time to their customers and prospects than to driving.
Knowing which structure fits your strategy is essential to realizing the benefits of territory optimization. Choosing the right model can improve efficiency and coverage, ensuring customer satisfaction. Below, we explore different territory types suitable for various business models and goals.
1. Geographic Territory
The most common territory type is where a sales rep is assigned an area. This usually consists of ZIP codes, counties, or states. It's a practical starting point that ensures clear boundaries, local coverage, and that reps service all accounts within that boundary.
2. Account-based
Occasional large or strategic customers are assigned to specific reps regardless of geography. This setup is effective for complex B2B sales cycles or high-value accounts. Multiple sales teams may call on the same customers, but account-based design facilitates relationship continuity and personalized service.
3. Hybrid
As the name suggests, hybrid territory design combines geographic and account-based assignments. This approach balances localized coverage with strategic ownership. Organizations often use it to adapt to or align with modern selling dynamics.
Sales territory optimization should be proactive, not reactive. Part and parcel of sustaining growth is recognizing when to adjust your territory structures. The following metrics may signal the need to reevaluate:
- Revenue per rep
- Customer response time
- Sales cycle length
Performance Metrics to Watch
The above metrics are not an exhaustive list. Other important metrics to watch out for include missed quotas, stagnant pipeline growth, and high churn rates. Optimizing sales territory can help you drive better performance when your top performers are limited by structure.
Workload Analysis
Driving long hours or servicing too many accounts can burn out even the best of reps. Conversely, underutilized reps will underperform and close fewer deals. Evaluating workload and adjusting design leads to faster onboarding and up to 67% happier reps.
Team Feedback and Rep Sentiment
Often, salespeople know before the data does when a territory is faltering. Feedback should be a priority as it helps you fine-tune alignments before they become systemic problems. Moreover, happy, committed reps who feel considered stick around longer, reducing costly turnover.
Realigning Territories With Mapping Software
Sales territory optimization software will transform how your company manages its sales structures. It empowers you to rapidly test, adjust, and implement optimized plans. This is why businesses need territory management software.
Use Scenario Planning Tools
Using scenario planning tools allows you to assess different ways to divide sales territories before investing in implementing changes. With eSpatial, you can simulate adjustments, compare outcomes, and share proposed alignments. It adds agility and efficiency to a typically rigid process and reduces the risk of error.
Visualize Weighted Centers
Weighted centers help determine the best placement for sales reps by factoring in where your accounts are concentrated. This reduces travel time and allows you to dedicate time to customers. Visualizing weighted centers is one of the most effective ways to optimize sales territory structures geographically.
Maintain Account Exceptions
Not all accounts should be moved during realignment. Strategic relationships will benefit when existing reps continue to service certain customers. eSpatial allows you to lock in exceptions during territory optimization.
Balance Workload Using a Sales Index
Using a sales index helps ensure reps have balanced workloads across regions. Considerations include account value and travel time. With territory optimization software, you can rebalance sales territories fairly and efficiently.
In short, using eSpatial's Territory Optimizer will give you better results in a fraction of the time. With Territory Optimizer, you can get balanced territories 92% faster. Using our tool with a workload balance is a no-brainer.
