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Retail Audit Software: Sales Territory Planning Practices

The best approach to successful field team management is effective territory planning that allows targeting the right customers, setting goals and priorities and ensuring sales growth. Effective territory management is vital for field teams performance, so there are many things to be considered prior to assigning of field reps to customers. In this article we’ll talk about several ways to develop meaningful territories for your field team that allows maximum use of their potential.

Territory planning is one of the most time-consuming and challenging processes for field team managers. In order to divide territories in a way that makes sense a field team manager should at least analyze the previous data from current customers including financial data, order amounts, points of sale locations, frequency of previous retail visits. This allows field team managers to identify the key goals of territory planning and provide territory distribution that makes sense.

The first way to divide territories between field reps is the historic method based on prior experiences and results when field team manager estimates either sales or penetration from the previous period. After territories are divided between field sales reps they start perform retail visits to the customers. When field reps start performing retail visits they concentrate their efforts on high-return customers or customers that are easy to interact with.

As the number of sales representatives grows the unevenness in territory distribution occurs. Eventually some field reps tend to work with loyal customers they have acquired at the beginning of their work and the other reps suffer trying to build thei customer base from dormant and no-return customers. While at first glance it may seem to be fair to the field team’s pioneers this way of territory distribution has negative impact on retail performance. Field representatives assigned to loyal customers tend to relax, and low-return customers feel constant field reps turnover that no way contributes the effectiveness of customer relationship management. The rational solution in this case is to force the distribution of loyal, low-return and dormant customers between sales representatives.

The most common way of territory planning is to divide your territories by area code. This way allows a field team manager to clearly define the spheres of responsibility for each field rep. In this case a field rep gets all the customers in certain area code and has to fulfill sales plans performing retail visits to points of sale, and to expand customers base in designated boundaries. Despite this way of territory planning seems to be simple and logical, it does not take into account a number of nuances, which may impact the success of territory planning.

For example, one customer can have multiple locations that are scattered in different areas. In this case the application of area code division will result in several field reps attending one customer. This complicates the analysis of field teams performance and may cause territory overlap and conflicts between field reps. In this case it’s better to assign all the customer’s points of sales to one field rep that has the best performance on this customer’s locations in order to increase the efficiency of field teams management.

Now we can see that the more sophisticated way of territory management is to divide territories by categorizing customers. Customers can be categorized by sales space, attendance, merchandise turnover, by the same products or similar needs. It only depends on your business specific needs and characteristics. After all points of sale are categorized each sales representative gets all the stores of one category or an equal number of stores from each category. This division allows field reps to concentrate efforts on defined categories applying specific standards of sales and customer interactions. 

Utilizing the above methods provides a base to divide your territories in a most efficient manner. Setting up up territories depends on the area of business and primary goals that are planned to be achieved. When drawing boundaries never forget that the main goal of territory planning is to maximize the time spent with customers and to minimize the time spent filling out paper forms, traveling between customers' locations and visiting low-return customers.

Keep in mind that field team management automation by virtue of a retail audit software solution simplifies territory management and analysis of field teams performance. Retail audit software also provides route optimization and automated data entry minimizing time to collect retail data. To learn more about how to improve your territory management visit


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