Territory planning is a complicated process yet a key one for sales planning. In today’s business climate, you need to be agile by constantly analyzing and optimizing your team’s territories to best assign coverage based on where your current sales opportunities are.
To help ensure your territories are optimized and designed for peak performance, take a look at these territory planning best practices.
- Assess Your Capacity and Resources
For sales leaders to hit their business goals, understanding the current resources of an organization and accurately planning its sales capacity is key. This vital process helps determine how many reps are needed on the floor to successfully achieve objectives.
Businesses can face difficulties achieving their plan when understaffing their sales force. With the inevitable departure of existing reps, companies spend three times base salary to find and train new staff to fill their spot – all while missing out on valuable sales in the interim.
- Know Your Ideal Customer Profile
Businesses need to know who they’re selling to and what type of customers are best to approach. This means businesses must identify their ideal customer profile. The best way to do this is to look at an organization’s existing customer base. Along with market research, this helps leadership identify who is most likely to become a customer. Then, planning teams should use these customer profiles, along with third-party data, to design territories that best allocate optimal coverage of these prospective customers.
- Gather Data Insights
Data is a key factor in strategic territory planning. Organizations need both internal and third-party data to ensure their sales territory plan provides the strongest opportunities for sales teams to succeed. In fact, companies with data-driven sales territory plans see up to 30% higher sales objective attainment.
When it comes to data, businesses can gather data from three key areas to inform optimal sales territory plans:
- Internally Generated Data:Customers and prospect data sourced from a company’s CRM, ERP, or spreadsheets.
- Market Data:Demographic that’s available from public sector sources and other data that can be purchased from third-party vendors
- Geospatial Data: Location of customers and potential customers. Geographic data is used for territory design and analysis.
- Automate Your Sales Territory Planning Processes
Automation speeds up the sales territory mapping process, and it also helps businesses realize the benefit of data-driven intelligence. Using automated mapping tools, companies can model potential territory maps, compare different models, and analyze existing territories to identify ways to improve.
Automated tools pull internal and third-party data to ensure that each territory provides sales reps equal opportunity to hit their number. That way, territories are balanced and fair, allowing reps to stay more productive and performance to increase. These tools not only cut down territory planning time, but also streamline your subsequent territory management processes.
- Consider Assigning Territories with Sales Rep Tenure in Mind
In some businesses, it’s important for businesses to plan with sales rep tenure, career paths, and skills in mind when assigning territories.
For example, in year one, sales reps are still learning the industry and products, so companies may consider this in territory assignment. At year five, a sales rep may begin to decline in performance. While performance drops can occur for several different reasons, it’s often helpful for organizations to use tenure as an opportunity to switch up sales team territory assignments, roles, and responsibilities.
- Continuously Analyze Your Plan & Improve
A sales territory plan’s performance should be analyzed on a continuous basis. This gives leadership deeper visibility into territory performance and the ability to proactively make changes before problems derail performance. That way, territories are always optimized, and performance and ROI are maximized.
Why Territory Management in Sales Matters
According to the Harvard Business Review, territory design can increase revenue by 2 to 7% without businesses making any changes to overall company strategy and resources. So, it’s no surprise that an organization’s sales territory plan has a big impact on performance. Territory planning can result in positive business benefits, like:
- 15% higher revenue
- 20% increase in sales productivity
- 15% increase in territory efficiency
- 75% reduced planning time
- Up to 30% higher sales objective attainment
Looking to learn more about how to automate, optimize, and pivot your sales territory plans? Schedule a meeting here with our experts.