An effective sales territory plan can make your team more productive, improve customer coverage, increase overall sales, and reduce costs.
On the other hand, unbalanced territory plans and constant changes in territory division can hurt productivity as well as working relationships between clients and account managers.
That’s why it’s so important to work on your territory management strategy, whether you’re just starting one, or updating an existing plan.
1 Define your market, analyse, and segment existing customers.
You should split up your customers into segments based on various characteristics such as: industry, location, purchase history, and whatever else is relevant to the organization.
Ask yourself, “Who are the top customers, prospects, and leads?” Categorize your customers into three groups.
Ø The first group should be your best customers, or the ones who require little effort.
Ø This is followed by the second group of customers: the ones who require a bit more work, but only those you are confident have potential revenue gain that justifies the extra work required by sales reps.
Ø The third group should be customers who require a lot of work.
With these groups formed, you can decide how to best use your resources. To discover what key trends are in your geography or market, look over the sales data that’s already been collected. Analyse the data to find which territories show signs of growth and then assign them to the sales reps who would be most successful based on their strengths (more on that below).You can also use existing sales data from previous years to better understand buying patterns, but you'll have to do some additional research to learn why they are purchasing (or not), when they purchase, what drives the sale to go through, and what the conversion rates are.
From this, you’ll learn how and when to reach out to your customers based on when they're likely ready to buy again, and how to really drive that sale home.
2 Conduct a SWOT analysis.
Next, you should identify your sales team’s internal strengths and weaknesses and external opportunities and threats with what is known as a SWOT analysis.
A SWOT analysis is a process that identifies internal and external factors that can affect the organization’s performance. When you have a better understanding of your strengths, weaknesses, opportunities and threats, you can develop a stronger sales territory plan.
Everyone brings different talent and skills to the job, so it’s important to have a good understanding of what your team has to offer to help them excel and reach your goals. What strengths will you build on? What is your team good at? Where do they excel?
Consider them as a team, but also think about sales reps' individual strengths. After all, strengths aren’t just confined to team members; they reflect the organization as a whole too.
Knowing everybody’s strengths will help you decide which sales reps to assign to which territory.
Potential strengths might include:
· A diverse customer base
· An established distribution base
· An excellent service team
Which weaknesses do you need to respond to? Think about weaknesses among your team, but also in the sales process.
· A very large geographic area
· A lack of time to develop understanding of the products, markets, and selling process
· Not understanding your customers' real needs
Are there any opportunities in your marketplace you can take advantage of?
· Untapped markets
· Under-served territories
· Growing demand for product or service
Take a look at the biggest threats in each territory and consider what threats in your selling environment you'll defend against.
Some threats you may discover include:
· Competitors fighting for the same market share
· Changes in technology
· New industry and regulatory standards
3 Set goals and create targets.
In order to make a successful sales territory plan, you must create clear parameters and realistic goals for the team as well as individual sales reps’ territories.
To do this, consolidate the trends you’ve discovered above to come up with S.M.A.R.T (Specific, Measurable, Achievable, Relevant, and Time-based) goals and realistic targets.
Here are some questions you may ask:
How many new opportunities do you need to meet quota?
Having sales quotas are a great way to motivate sales reps, but if you find you're not meeting those quotas, you have a problem. There could be weaknesses in the sales pipeline, or you may need to seek new opportunities. In order to set goals and benchmarks for the team, consider using the top-down approach.
Using the top-down approach to sales quotas (where you set a goal for the period and then assign sales quotas to support this goal), you can go over the data from previous periods to get an idea of what your team was able to accomplish in the past and what a realistic goal for the future is. This can help you decide how many new opportunities you'll need to pursue in order to meet that goal.
Where do most of your leads come from? Which geographical regions should you concentrate on?
Which products or services are most profitable? Who is purchasing them?
Which opportunities should we focus on?
After learning what it is you want to achieve, you can give your team clear objectives for each territory.
4 Develop strategies to accomplish your goals.
With clear customer segments and goals in place, it’s time to create strategies to succeed.
Using the information collected so far, you can now work out an even distribution of specific regions or markets among individual reps.
The SWOT analysis mentioned above gives you a better idea of how to best assign your team members’ skills and talents to a territory.
The customer segments will help you figure out how often different accounts should be contacted and how to contact them.
Consider the following questions when creating your strategy:
· How will you go through current accounts?
· How can you leverage current successes?
· How will you generate new leads?
· Where do you need to improve?
· What does your team need in order to reach their goals and targets?
In addition, consider your resources:
· What resources do your sales reps need in order to manage their accounts?
· Which sales reps have the skills or connections you need?
· Are there any external resources you can use to help?
When creating your action plan, don’t forget to look at what your high-leverage actions are, what resources are needed, due dates, and key milestones.
5 Review and track your results.
The final step for a sales territory plan is to take the time to review and track the results to optimize territory division. This is important for measuring progress to see how the plan is impacting sales.
You should use your plan as a guide to produce intended results and fine-tune it on a regular basis when needed.
Things to look for as you track your sales territory plan results:
· Have sales increased or decreased in a specific region or market?
· Are there any disparities between sales in different territories?
· What are the costs associated with each territory?
· Are any sales reps struggling to keep up with their leads?
· Are all sales reps meeting their quotas?
· Are any markets under-served and in need of more assigned sales reps?
The original document is “https://www.copper.com/blog/sales-territory-plan#swot ”. The initial writer of the original document is Cole Nemeth . ©August 31, 2019 . All Rights Reserved.