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SALES TERRITORY |
Managing
the Sales Territory
Most Sales People make the mistake of starting
in the middle.
They start with ‘action’
You’ve been given a sales territory. Now what?
Go sell – Grow the territory! Action.
First of all, let’s make sure we know what we
have and what we’re doing.
Here are some of the initial pitfalls.
1) Some sales people simply take the new product
line to their existing call pattern.
They collect lines and see how much product they
can more through the channel they have already
developed. This strategy almost guarantees they
will play musical lines, losing lines as quickly
as they add them. It is not a customer or
manufacturer friendly strategy.
2) Some sales organizations look for as much
geography as they can get.
They hope to maximize commissions with items
shipped into the territory - without having to
sell and service. This won’t last long.
There is no evil intent here. All sales people
really hope to grow the business. It is how they make money. Some have never
learned to be a Territory Manager.
Here are some initial steps to help you maximize
the geography you represent.
1) Clearly know your area of responsibility.
The Sales Territory boundaries should be
clear. Better yet, assign zip codes so you can
color it on a map. Free Zip Code references and
boundaries, as well as maps are available here:
http://www.zip-codes.com
2) Analyze the territory.
- What is the population base?
- What are the income levels?
- What is the ethnic and age breakdown?
- What are the major population centers?
- Who are the major employers that might affect
your sales?
Links to Analyze Your Territory
Population Trends by State and Metropolitan Area
http://proximityone.com/population_trends.htm
Median Housing Values
http://proximityone.com/acs0708mhv.htm
Educational Attainment
http://proximityone.com/acs.htm
Employment, Wages by County, Metro & State
http://proximityone.com/acs.htm
Graying of America Population Trends 65+
http://proximityone.com/acs.htm
Personal Income Rankings by Metropolitan Area
http://proximityone.com/msapi05.htm
3) The Most Valuable Geography
The Top 40 Metropolitan Areas have over half
of the U.S. population.
Half the population in just 40 cities. If you
have one or more of those cities in your
territory, be sure you are providing focused
coverage. It is the biggest opportunity you
have.
Your goal is to be busy and profitable locally.
The less time you spend traveling, the more time
you spend selling.
The more time you spend visiting key accounts.
Your service is better. Your relationships grow
stronger.
So, what are the major population centers in
your territory?
Are you close enough to provide appropriate
service?
Traveling a great distance to serve a city is
delusional.
You won’t provide the service or consistency a
local sales person can.
And you’ll take away from your customers closer
at hand.
Does that mean you shouldn’t travel? Not at all.
Just be sure you focus your energies
accordingly.
If you have a major metropolitan area, invest
your time there.
For a ranking of the top metropolitan areas,
visit Wikipedia.org at
http://en.wikipedia.org/wiki/List_of_United_States_cities_by_population
4) Effective
Channel Marketing
Now that you know your geography, what is
the potential?
Channel marketing is simply identifying like
customers that are prospects for your product.
You may choose to include a new channel in your
call pattern, or you may find it a distraction.
In either case, you should identify the
potential of all channels so you can focus your
time on the best opportunities.
Channel Samples
Sporting Goods – Ski Shops – Running Shops –
Climbing Shops – Outdoor Retail – Hunting &
Fishing – Bicycle Shops – General Merchandisers
Drug Stores – Grocers – Convenience Stores -
Supermarkets – General Merchandisers
Hospitals – Surgery Centers – Acute Care
facilities – Surgeon Clinics – Physical
Therapists – O&P - DME.
Whatever product you carry, there are multiple
distribution channels you can choose.
First, make a list of the various channels you
could consider.
Then guide your efforts to maximize your sales
by identifying all the prospects in each
channel. This is YOUR inventory. Now you know
who all you can sell.
You’ll be amazed at how much potential this
exercise reveals. With this inventory you can
decide which channels offer the best potential.
5) Competitor Analysis
In your training, you’ve already identified
competitive products. If you are well trained,
you’ve seen and used the products. Now apply
that training to your territory.
Which competitor is strongest in your territory?
Which competitive products do you see pop up the
most?
Who is the sales person? What do you know about
them?
What are their strengths?
How long have they been selling in the area? Do
you know their vulnerabilities?
You should know all of the sales people you sell
against.
The information will be valuable when you are in
front of customers.
Is one competitor particularly weak in the
market?
Can you erode their market share?
Have you identified their customers?
Sales Plan
This is easy, but important. It is very simple.
There are only three ways to grow your business.
#1 Grow your existing accounts
#2 Add new accounts
#3 Retrieve lost accounts
#1 Grow your existing accounts (Key Accounts)
You’ve already identified your Key Accounts (the
top accounts in the territory according to the
80-/20 rule).
Key Accounts are the closest sales dollars in
the territory. These accounts believe in you and
your products. They are the most likely to give
you a try.
Each of these key accounts should have a
leverage sales plan specifying the next few
products you intend to introduce over the next
90 days. Evaluate competitors still in the
account. What products can you add to erode
their position? You should always know where you
plan to take your most important customers.
Otherwise, you’re just showing up.
#2 Add New Accounts (Target Accounts)
Ask most sales people if they have new prospects
and they will readily say ‘yes’ - and show you a
list of a hundred accounts. That’s a directory,
not prospects.
Don’t sell everybody – sell somebody
Sales take time. You’ve got to introduce
yourself, position yourself and your company.
Establish a relationship with the account. Then
earn your way in. You can’t effectively do that
with very many accounts.
Be focused on the opportunity. Identify maybe
three prospects that you’d like to earn over the
next 90 days (depending of course on your own
sales cycle). Invest some time to get to know
the account.
The competitors they use. The volumes they use.
The prices they pay. Their satisfaction with the
current product and rep – though this may come
more from your market understanding than their
comments.
Identify 3 accounts in a specific time period
and focus on that opportunity.
Invest time. Track results. Earn the business.
When you earn the account, or strike out, move
on. Add another new prospect with a set time
period. Will these accounts all be decided
within your time frame?
Of course not. They will carry forward. But they
will carry forward with the benefit of the
knowledge and relationships you developed in
that focused time period.
They will be a more viable lead than just making
initial calls on more accounts.
#3 Retrieve Lost Accounts
Oftentimes we lose accounts just from a lack of
attention. Perhaps the prior sales rep didn’t
visit. Maybe another rep just diverted the
business. Maybe it changed for no real reason at
all. You won’t know until you visit. When you
are in the area, visiting your key accounts or
target accounts, plan to stop by the lost
accounts. You’ll be surprised at the percentage
of businesses that return simply because you
showed interest. Others will return when you
listen to why they left, and correct the
problem. Lost accounts are among some of the
easiest business to garner.
All of these accounts should be listed in your
CRM database where you’ll have an entire profile
of the account and record of activity.
The
Sales Management 90-Day Plan
The number one rule in selling is to have a
plan.
Don’t wake up Monday morning with no
appointments and just get in the car.
Too many sales associates manage their time by
requirements placed on them.
“I have to deliver a product sample, so I’ll run
up there first.”
Pretty soon, the territory is managing them.
The plan is a way of organizing yourself to
spend more time selling in the field.
The way to do this is build around the 90-day
plan.
You know what you need to achieve to earn the
level of income you want.
You know the number of calls you need to make
each day.
How many prospects you’ll need to feed that kind
of activity.
You know who the prospects are and what you want
to sell them in what period of time.
You also have your personal standards in terms
of calls and closings.
If not, see ‘Living on Commissions’ It is
a great exercise for Sales people to assist in
planning.
Break it down into a 90-day play. What you will
accomplish this next quarter:
- Plans for your Key accounts (80/20 rule).
- A consistent presence with your Target
accounts
- Emphasis on Focus Products offering higher
commissions
- Full utilization of new product launches
- Maximizing seasonal opportunities
- Planning Trade Conference Attendance
- Providing alternatives to competitive
shortcomings
- In-Service Training for newly placed products.
- Networking and Cold Calling
The 30-day Plan breaks the larger plan into
tactics, or what you’ll do each week.
You know what you need to achieve during the
quarter.
The 30-Day plan determines the week and day
you’ll do it.
Will you deviate from the plan? Of course. But
at least you’ll know you deviated. It allows you
to evaluate opportunities and spend your time
for the best return. It also allows you to
change priorities without losing track of them.
Customer
Management Test
Let’s see how effective you are managing your
customer’s buying process.
Think about your last three sales.
Who bought the product?
Who used the product (or witnessed its
performance)?
Who was responsible for that department’s
results (the management connection)?
How did those three (or more) people interact in
the purchase decision?
How did the buying process work?
What access did you have to these people?
Did you meet them?
Did you talk to them?
Did you present to them?
The further away you sell from the user and the
manager, the more price will matter.
The closer you are to these users, the less the
nominal price difference will matter.
Remember, seldom is your price difference with a
competitor more than about 10%.
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