Master Territory Sales Management
- Published on July 31, 2023
- Updated on September 8, 2024
Table of Contents
Territory sales management – it’s the linchpin of successful sales teams. Yet, did you know that a staggering 31% sales teams struggle with optimizing sales territory planning? In the competitive arena of modern sales, every opportunity and resource must be maximized.
KEY TAKEAWAYS
- Analyze customer data to identify location patterns, industry clusters, and ideal customer profiles when designing sales territories. This provides a data-driven foundation for sales territory mapping.
- Choose a sales territory management approach – geographic, industry, customer segment, product, or hybrid model – based on your sales process, resources, and selling strengths. Match strategy to your business.
- Create balanced workloads between sales territories by setting relative quotas and goals based on sales potential. Prevent burnout and maximize revenue.
- Specialize sales territories by industry or customer segment to boost expertise. This enables strategic conversations and larger deal sizes.
- Incentivize prospecting new accounts within assigned sales territories. Recognition, monetary rewards, and promotions motivate territory development.
- Foster collaboration between teams through best practice sharing, co-selling incentives, and cross-territory introductions. Break down silos.
- Provide customized sales training aligned to territory needs – product mix, maturity, industry nuances. Ongoing learning sustains skills.
- Leverage CRM, sales route optimization, BI, and mapping tools for visibility into sales territory performance. Technology accelerates strategy.
- Maintain accountability through consistent monitoring of sales territory KPIs versus just quarterly reviews. Quickly address underperformance.
- Continuously optimize sales territories in response to market shifts, new products, hiring changes, and customer needs evolution. Agility drives growth.
I’ll never forget the moment it became painfully clear our territory sales management strategy was stunting growth at my previous sales team. With nearly a decade experience in optimizing sales territories, I’ve seen firsthand how transforming sales territory management strategy can make or break sales quota attainment.
It was Q3 and our revenue growth stalled. Sales reps complained of winding territories and unrealistic sales quotas. I knew optimizing our territory sales management was needed to reignite growth.
We analyzed customer data, condensed fragmented territories, and matched them to sales rep strengths. We set sales quotas based on current sales territory performance and on overall sales territory potential. Growth took off – deal sizes rose, account executives hit sales quota, and retention improved.
If poor sales territory management is threatening your sales team growth, I want to help. In this definitive guide, I’ll show you how to optimize territory sales management based on lessons learned over my career. I’ll also share best practices and sales territory management tips that I’ve learned over the years managing sales territories.
With the right vigilance and optimization, effective sales territory management allows sales organizations to distribute accounts and maximize revenue per sales rep. Master this and you’ll spur growth by unlocking the potential of your sales territories.
What is territory sales management?
Territory sales management is the strategic planning and execution of sales activities within defined geographic areas or accounts to maximize revenue generation and customer acquisition. It involves sales territory design, quota setting, performance metrics, and compensation strategies aligned to business goals.
At its core, effective sales territory management aims to ensure territories are designed in a way that considers market potential, drives growth and keeps workloads reasonable for sales reps. This enables them to effectively sell into their defined geographic areas or accounts.
Key elements of territory sales management include:
- Sales territory design – Grouping accounts or geographic areas into sales territories using customer data and insights on sales potential, customer density, industry clustering and more. The goal is to divide markets into units that represent equal revenue potential and workloads.
- Sales territory mapping – A visual representation of defined sales territories that enables analysis of territory design, identification of gaps and overlaps, and ensures sales strategy alignment to revenue goal.
- Sales quota setting – Establishing expected sales targets at the territory level based on historical performance, sales potential and growth strategies. Sales quotas motivate account executives and allow sales performance measurement.
- Sales territory plan – Developing account plans, target buyer profiles, competitive analyses and messaging for each sales territory. Helps sales reps optimize activities and resources.
- Sales performance metrics – Tracking rep and territory performance metrics like achievement to sales quota, current accounts penetration and share of wallet to evaluate sales territory performance. Enables informed sales territory management.
- Sales compensation – Aligning pay structures and incentives to specific territory sales goals and objectives. Can include salary, sales commissions, bonuses and contests.
- Ongoing refinement – Regularly reviewing and adjusting elements like territory design, sales quotas and compensation plans in response to market changes.
Based on my observations, with the right sales territory strategies, territory sales managers can drive higher revenue attainment, growth and sales rep productivity within geographical area or key customer accounts. In my experience, this requires balancing sales territories for fairness, optimizing workflow and equipping sales teams to maximize opportunities.
Top 5 Most Effective Sales Territory Management Planning Approaches
| Sales Territory Plan | Sales Territory Plan Description | Sales Territory Plan Benefits | Sales Territory Management Considerations |
|---|---|---|---|
| Geographic | Sales territories are organized based on geographic areas such as cities, regions, counties, or countries. Customer accounts are grouped based on proximity to simplify travel and logistics. Sales reps build expertise in local business landscapes. | Simplifies travel logistics and coordination of in-person sales activities. Helps sales reps build knowledge of local markets, business landscapes, and customer needs. | Can overlook other important factors beyond geographical area. Sales representative industry expertise may be diluted covering multiple verticals in a single geographic location. |
| Industry | Sales territories are aligned to industry verticals such as healthcare, manufacturing, technology, financial services. Sales reps build expertise in specific vertical needs. | Enables sales reps to focus and develop deep knowledge of industry trends, terminology, buying processes, and competitor landscape. Customized sales process to niche needs. | Requires market research and planning to segment sales territories by industry sub-verticals. Must have sales capacity to support focused sales territories. |
| Customer Size | Sales territories are grouped by customer size bands such as SMB, Mid-Market, and Enterprise accounts. Tailors sales process, resources, and sales efforts to needs of each customer size band. | Sales process can be tailored to needs of each size - for example, shorter sales cycles for SMBs versus longer strategic selling for enterprises. Dedicated sales rep resources. | May constrain growth paths if restricted from expanding into other size segments. Account transitions between sales reps if customers grow across size bands. |
| Product or Service | Sales territories are organized around specific product or service offerings in a company's portfolio. Enables sales specialization. | Sales rep can become an expert in selling and supporting a specific product or service. Customized sales messaging and sales collateral. Easier to identify cross-sell opportunities. | Requires coordination across sales territories and sales teams to provide complete solutions to customers. Account executives may lack view of complete portfolio. |
| Hybrid | Combines multiple sales territory management approaches such as geography + industry or customer size + product specialties. Allows optimizing sales territories on multiple dimensions. | Balances benefits of different sales territory management approaches - for example, local presence plus industry expertise. Tailor sales territories across multiple factors. | More complex for sales managers to plan, balance and coordinate across multiple sales territory dimensions. Requires clarity on sales territory overlaps. |
Why does sales territory planning remain challenging?
The Sales Management Association (SMA) and Xactly conducted a survey with over 100 participating organizations. The respondents’ primary job roles were predominantly in sales operations, accounting for 62% of the participants. Senior sales leaders made up 19% of the respondents, while territory sales managers accounted for 14%.
Out of the surveyed sales teams:
- 36% excel in sales territory planning.
- 33% are moderately successful in sales territory planning.
- 31% struggle with sales territory planning.
Throughout the years of optimizing territory sales strategies, I’ve found the complexity of effective sales territory planning has only increased despite new sales technologies meant to enable it.
From what I’ve noticed, a key challenge is sales data overload paired with insight gaps. The volume of customer and sales data available has exploded thanks to modern CRM, marketing automation and analytics platforms. However, distilling actionable insights from the vast data to optimize territories remains difficult for many sales leaders. This leads to missed revenue opportunities, inefficient sales territory alignment, and stalled revenue growth. While technology helps aggregate sales data, synthesizing findings into an aligned sales territory management strategy still requires human experience many sales teams lack. And when sales data remains siloed across systems, it dramatically slows decision-making velocity.
Another persistent struggle I’ve noticed many sales organizations experiencing is quantifying the true revenue potential of sales territories. In my experience, basing potential on past performance has inherent flaws, as markets evolve quickly. What delivered results last year may not predict future opportunity. This makes setting fair sales performance goals and ensuring adequate coverage challenging across sales territories. Sales leaders often end up putting sales reps into suboptimal or tapped-out sales territories that stall individual and sales organization growth.
Additionally, a “set it and forget it” mentality still persists for many sales leaders when it comes to territory sales management. But regular re-planning and optimization is essential in dynamic modern sales environments. Neglecting vigilance inevitably leads to workloads, travel inefficiency, mismatched resources and lost revenue potential as territories grow misaligned with current market realities.
Not only that but also overburdened sales teams also hinder progress. The intensive process of sales territory management planning simply overloads some sales organizations on top of their daily system and data responsibilities. This forces reactive versus strategic sales territory planning and a disadvantage for sales reps and sales managers relying on their output.
In my opinion, with the right processes, leadership commitment and sales technology investment, these challenges are absolutely surmountable. But from my experience it requires dedicating capable analytics talent and implementing platforms purpose-built to transform complex sales data into territorial insights sales teams can act on.
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How to Create an Effective Sales Territory Management Plan
After over a decade in B2B sales, I’ve learned even seasoned sales teams can benefit from reevaluating their sales territory management plan. Markets shift, new competitors emerge, account needs evolve – change is constant. An outdated sales territory management strategy stunts growth. That’s why it’s incredibly important to assess your current alignment regularly, identify improvement opportunities, and implement a high-impact sales territory plans. With the right sales territory plan, you can reignite growth by getting better sales productivity and leverage out of your sales resources and relationships.
Sales territory planning STEP #1:
Analyze your market and target customers.
In my experience, analyzing customer data has proven to be the most crucial first step when it comes to sales territory management planning. Your current customers provide invaluable clues for designing optimal sales territories.
These are the steps that I always follow to analyze our market and target customers:
1. Gather customer data.
I always start with pulling detailed data on the customer base including:
- Location: Pinpoint geographic location of high-value customer accounts. This insight can inform sales territory boundaries.
- Revenue: I try to prioritize sales territory plan around the highest revenue accounts. For example, I always create an “enterprise sales territory” for top spenders.
- Industry: Spot pockets of customers in certain industries that would benefit from specialized territories.
- Purchase history: Identify upsell opportunities based on transaction trends.
- Pain points: Understand needs to pinpoint potential new sales opportunities. Leverage your CRM to pull detailed reports on current customer attributes. Segment data-tables by key fields like location and revenue to easily spot patterns.
2. Identify ideal customer profile (ICP) and location patterns.
Analyze your top customer accounts to identify common attributes of your ideal target customers. Seek potential customers that fit this ideal customer profile (ICP) in new locations using tools like LinkedIn Sales Navigator. Focus your sales territory management strategy around the highest density areas of your ideal target customers.
For example, in my previous sales organization, we found our top customers were tech companies with 500-1,000 employees. We searched for similar companies in new regions to expand our enterprise tech territory and boost sales territory performance.
3. Uncover geographic or industry customer clusters.
Granular customer data reveals clusters in certain locations or industries. As I’ve learned, tailoring compact territories around these critical masses maximizes sales productivity.
For example, we noticed a cluster of mid-market B2B tech companies in the Southeast. We consolidated this region into a single sales territory to get our sales team up to speed quickly on those customers’ needs.
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Sales territory planning STEP #2:
Determine sales territory management plan.
When embarking on sales territory planning, one of the biggest decisions is choosing the approach for grouping customer accounts into territories. Based on my experience, here are the most common options along with key considerations.
Pick your sales territory management approach
- Geographic – Group accounts based on location like a city, region or country. Simple but may overlook other factors.
- Industry – Create industry-specific territories to build vertical expertise. Requires market segmentation.
- Customer type/size – Tailor territories to customer types like SMB, mid-market, enterprise. Can boost expertise.
- Product/service – Align sales territories to product or service offerings. Enables specialization but requires cross-collaboration.
- Hybrid – Blend multiple sales territory management approaches like geography and industry. Allows optimizing on multiple dimensions.
How to determine the best sales territory management strategy
Choosing the most effective sales territory management strategy to planning and aligning sales territories is crucial for every sales territory manager. The wrong sales territory management strategy can stunt growth. Based on my experience transforming sales territory strategies, here are three steps to determine the best approach to sales territory planning:
- Understand your Ideal Customer Profile (ICP) – I always start with ICP. Analyze current high-value customer accounts to understand common attributes of your best-fit customers. Key facets of your ICP include: Firmographic data – location, company size, industry vertical, tech stack etc. Demographic data – persona nuances like decision-making authority, role in buying process etc. This analysis should reveal whether geographic location, industry, customer size or other factors are most relevant to your sales territory plan.
- Map your sales process stages – Next, map out your sales process stages from initial contact to close. Assess required activities like needs assessments, demos, calculating ROI, contacting decision makers etc. As I’ve come to know, long complex sales cycle with multiple stakeholder touchpoints warrants different sales territory planning than short transactional sales.
- Gauge resources and sales representative capabilities – Factor in resources like outside sales vs inside sales, remote selling capabilities, and constraints like budget and headcount. Understand the skills, experience, and specializations of your sales reps. Avoid approaches mismatched to resources and skills, which will frustrate top performers.
Finally, weigh all inputs from ICP, sales process, and resources. Select the sales territory alignment approach that is most tightly to how you successfully acquire and serve customers. I highly recommend you revisit your sales territory plan periodically as your business evolves.
For example, you can divide sales territories and your outside sales reps geographically while your inside sales teams can be specialized by industry due to their remote selling model.
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Sales territory planning STEP #3:
Define and map sales territories.
With a sales territory planning approach determined, the real work begins – using data to define productive sales territories. I always focus on these key steps when defining and mapping sales territories:
- Use Data to Delineate Territories – Leverage your CRM and other data sources to group accounts into sales territories aligned to your chosen approach. For example, if taking a geographic approach, use billing location data to group nearby accounts into territories sized based on sales capacity. Set clear, data-driven territory parameters like geographical area, industry sub-segment, or customer size band. Document parameters to guide ongoing territory sales management.
- Visualize Territories – Use mapping software to visualize territories and ensure optimal sales territory alignment. Visibility makes it easy to spot fragmentation points like disjointed zip codes or regions disconnected by natural boundaries. Overlay contextual data like traffic patterns and sales office locations to further refine sales territory boundaries. Present mapped territories to sales teams to collect feedback. Leverage sales reps’ field knowledge to refine sales territory alignment.
Continually optimize your sales territory mapping over time as accounts shift. As the famous sales territory management saying goes “Your sales territory map is only as good as the data feeding it.”
Sales territory planning STEP #4:
Divide sales territories and assign them to sales reps.
After you divide sales territories, the next critical step in sales territory management planning is assigning those sales territories to the right sales reps and sales teams. Here’s how I recommend you approach this process:
- Match Sales Representative Skills to Sales Territory – I always take a consultative approach by interviewing account executives about their interests, strengths and development areas. I align strengths like technical expertise or consultative selling to the sales territory needs. I try to avoid forcing unnatural alignments, as it will frustrate top performers.
- Distribute Territories Fairly – I use data-driven metrics to distribute territories. Options include workload capacity, revenue potential, number of customer accounts, and geographic dispersion. I always set sales quotas relative to the sales territory value to ensure fair compensation. Once that’s done, monitoring revenue attainment regularly to confirm sales performance and alignments is my top priority.
- Develop an Account Assignment Process – I highly recommend you define a process for assigning new accounts that span multiple territories, like a parent company with divisions across different geographic areas. This prevents sales confusion and duplication of sales efforts. Consider things like the primary billing location, industry, size or strategic importance when determining sales territory alignment at the account level. Try to communicate changes transparently to provide continuity for customers.
I always do my best to frequently solicit sales representative feedback on sales territory alignment to identify improvement areas. You should also optimize your sales territories periodically based on changes in sales team strengths.
Sales territory planning STEP #5:
Set sales goals for sales territories.
With thoughtful sales territory planning and alignment, next comes one of the most motivating elements – establishing measurable goals sales for your sales territories. Here’s how I approach setting measurable goals and tracking sales territory performance:
- Set Sales Quotas – I always leverage data like sales history, market opportunity, and competitive intelligence to set sales quotas for each sales territory. I take a tiered approach with separate goals for new customers, renewals, upsells etc. This provides clarity. I do my best to communicate revenue goal rationale transparently to every sales representative. Solicit feedback to ensure buy-in.
- Define Activity Goals – I set weekly or monthly new leads prospecting activities like phone calls made, regular and video emails sent, potential leads sourced to keep sales pipeline full. Activity goals provide leading indicators of sales results and increase accountability. Make them ambitious but achievable.
- Track Customer Retention – I always establish clear targets for retaining high-value customers and mitigating churn. Customer retention is equally as important as new opportunities. Make sure retention metrics capture at-risk signals like low spend, contract expiration, and competitor encroachment.
- Monitor Progress Closely – Every territory sales manager should review current sales territory performance against sales territory goals continuously via their CRM and regular one-on-ones.
In my experience, quick course correction is key when account executives fall behind. Sales reps exceeding goals may warrant sales territory expansion.
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How to Optimize Sales Territories for Maximum Profit
Profitability hinges on how you align sales territories to operational efficiencies. In this section, I’ll share sales territory optimization strategies I’ve used to improve margins by over 20% for clients. We’ll cover clustering to minimize travel time, specializing to increase deal sizes, concentrating high-referral accounts, and more. With the right sales territory management plan, you can turn sales territories into profit engines.
1. Divide sales territories to minimize travel time.
For outside sales teams covering broad regions, travel time can become a major constraint on selling time and profitability. But optimizing sales territory alignment to cluster nearby accounts can greatly increase customer face time.
Here is what we did at my previous sales organizations to optimize sales territories for maximum profit through sales territory clustering:
- We mapped all customer locations and sales rep geography using mapping software. This revealed fragmented travel routing.
- Next, we consolidated sub-scale territories spread across cities into compact territories centered around major metro areas.
- Clustering customer accounts within a 60 mile radius minimized travel time between meetings.
- With 3-4 hours freed up daily, our sales team generated more meetings and closed more business.
- Higher sales volume combined with lower travel costs increased overall margin by 18% for the optimized territories.
- We also layered in industry specialties atop the geographic clusters to further boost sales productivity.
The travel time savings from better sales territory clustering provides pure profit leverage, allowing a sales team to earn more without working more hours. And concentrating sales territories also builds knowledge and customer relationships. Having done this before, I believe it’s a win-win for both margin and customer experience.
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2. Specialize sales territories to increase sales performance.
As I’ve discovered over the years in B2B sales, when a sales team develops deep expertise in their sales territory’s niche, it enables more strategic sales conversations and larger deal sizes.
Here’s how specialized sales territories can help your sales team gain industry expertise:
- Sales reps master industry terminology, buyer needs, and competitive landscape.
- Discussions with prospects and customers carry more weight.
- Sales pitches and sales collateral can be fine-tuned with industry-specific use cases, customer data, and current customers logos. Relevance draws new potential clients in.
- As account executives encounter common objections, they become adept at navigating those discussions.
- Specialists identify niche upsell opportunities that generalists could miss. Share of wallet increases within accounts.
In my experience, specialization works for sales teams selling into any target market – whether business verticals, consumer segments, product user types or delivery models. Matching expert account executives to niche buyers is a proven recipe for driving higher margins.
3. Assign sales territories based on lead sources.
Not all potential leads are created equal. After seeing many cases, segmenting sales territories according to lead sources allows sales reps to specialize in capturing and converting each source optimally. As I’ve seen it, this can lead to major margin gains.
For example, this is what one of my friend’s B2B SaaS company did to assign sales territories:
- They split sales territories by key sources – organic search, paid search, event leads, referrals.
- Sales reps focused time and budget optimizing conversion rates from their assigned channel.
- The organic search team perfected SEO and identified target keywords that doubled lead flow. Higher volume drove down CAC (Customer Acquisition Cost).
- The referral team put 90%+ of sales efforts into delighting and leveraging existing customer base to produce word-of-mouth leads. These converted at 3x rates but had minimal acquisition costs.
- Total lead volume increased 20% YOY and overall CAC decreased 12%. Bottom line profit spiked over 30%.
The same sales territory management approach applies beyond marketing channels. Sales territories could be organized around business models, product lines, distribution partners – any source with unique conversion dynamics.
In the time I’ve spent doing this, segmenting sales territories this way builds specialized capability and avoids one-size-fits-all approaches that waste resources. Matching account executives to lead sources yielding “easy” wins for them optimizes profitability.
4. Shape sales territories to increase referrals.
Referrals have long provided a “growth hack” for boosting revenue efficiently. Speaking from my own experience, concentrating referral-ready accounts into defined sales territories is a proven way to maximize this high-margin source.
Here’s how sales organizations can shape sales referral territories:
- Profile your customer base using NPS surveys and digital engagement data to identity happiest, most connected customers.
- Group these high-potential referral accounts into distinct “raving fan” territories.
- Train your sales team on optimizing word-of-mouth referrals – social selling, case studies, network mapping, etc.
- Implement referral tools and incentives to boost sharing.
While referrals aren’t available to all types of businesses, they offer unmatched efficiency where possible. After seeing countless B2B sales cycles play out, segmenting sales territories to surround your sales team with referral-ready accounts can provide an ideal profit engine.
5. Balance workloads to prevent sales team burnout.
From what I’ve noticed, when some sales reps are overloaded while others have excess capacity, it drags down results and morale. But balancing workloads sustains sales productivity and profitability.
Here’s how your sales team can balance workloads to prevent burnouts:
- Set sales quotas based on sales territory value – Don’t force a sales representative into unrealistic sales quotas based on company-wide goals. Tailor sales quotas to the opportunity size in each sales territory.
- Limit sales territory radius based on capacity – Condense territories for high-volume sellers versus stretching territories thin. Match geographic areas reach to sales representative bandwidth.
- Reassign accounts to lighten overloaded territories – Move accounts between territories to achieve more balanced account volumes based on sales velocity.
- Add specialized sales support roles – Supplement territories with account managers or SDRs to handle administrative tasks and widen bandwidth.
- Evaluate activity rates using CRM sales data – If some account executives show chronically low activity levels, use it to identify territories needing rebalancing or additional resources.
- Monitor for signs of disengagement – Based on what I’ve encountered, burnout can manifest through absenteeism, lackluster CRM updates or sudden activity drops. Fix imbalances fast.
- Incentivize team-selling across territories – Encourage collaboration between sales reps on co-selling large accounts to collectively manage workloads.
Preventing workload imbalances keeps account executives motivated and operating at peak sales productivity. And having the capacity to capitalize on all opportunities compounds sales margins over time.
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Benefits of Optimizing Sales Territories
Reflecting on my struggles here, implementing an effective sales territory management strategy takes A LOT of work, but the sales territory planning effort pays dividends. Here are some of the major benefits I’ve seen many sales organizations realized:
- Increased Sales Productivity – With balanced workloads, simplified travel routing, and resources matched to opportunities, account executives gain efficiency allowing more time for selling.
- Higher Win Rates – As I’ve found, when account executives deepen expertise in assigned territories through specialization, their relevance and authority with new leads improves. We’ve seen average deal sizes increase upwards of 15-22% post sales territory optimization as win rates improve.
- Reduced Travel Costs – Optimizing routing density reduces windshield time and miles traveled, resulting in major savings on expenses and opportunity costs.
- Improved Sales Forecasting – Specialization improves understanding of territory sales cycle and seasonality, making forecasting more precise. Our sales team has reduced forecast variance from +/- 27% to +/- 12% after optimizing sales territories.
- Happier Sales Reps – Fairness, transparency, and increased success revitalizes account executives. Reduced churn follows.
Best Practices for Territory Sales Management
Beyond initial sales territory planning, vigilant ongoing sales territory management is crucial for driving peak sales performance. Based on my years in B2B sales, I highly recommend you apply the following principles to keep your territory sales strategy aligned to constantly evolving sales realities.
1. Regularly review territory sales data and optimize sales strategy.
Continuously reviewing sales rep and territory performance data and optimizing sales territories accordingly is imperative for every territory sales manager. Markets move fast, so taking a “set it and forget it” approach to territory sales management simply won’t cut it. Believe me, I’ve learned it the hard way.
- Set a Regular Cadence for Reviews – Don’t leave analyses open-ended. Establish a set monthly, quarterly or annual cadence for assessing territories. Tie reviews to your broader business planning cycles when possible. Adopting a consistent rhythm ensures sales optimization receives dedicated focus versus getting lost amongst competing priorities.
- Take a Data-Driven Approach – Leverage your CRM, marketing automation platform, and other systems to extract key performance indicators on territories. Metrics may include sales velocity, churn, account health scores, and buying signals. Let the sales data guide your realignment decisions versus gut instinct or sales reps’ anecdotal feedback alone. Sales data doesn’t lie.
- Involve Sales Reps in Interpreting Signals – While sales data provides the foundation, involve sales representatives in evaluating patterns and risks uncovered in reviews. Account executives have crucial qualitative insights that add context. In my experience, two-way dialogue builds buy-in for changes and uncovers nuances your sales data can miss.
- Realign Quickly When Needed – When clear sales territory improvement opportunities surface, move forward decisively with realigning boundaries, territories and account distributions. Don’t stay stagnant if territories grow misaligned. Be willing to make calculated bets on new alignments to contain underperformance.
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2. Balance workloads between sales territories.
I always try to ensure balanced workloads across my sales team and sales territories. It is the key to maintaining fairness, motivation, and maximizing revenue. When sales territories grow lopsided, your sales team can get frustrated very quickly. Here’s what I do to avoid that in your sales territory management plan:
- Set Sales Goals Relative to Sales Territory Value or Sales Territory Potential – You need to work backward from sales territory value or potential to set appropriate sales quotas and activity metrics versus adopting one-size-fits-all sales goals. This sales territory plan has always worked for me since this approach tailors sales goals based on opportunity size and ensures that sales reps in sales territories with less potential don’t become demotivated.
- Monitor Capacity Regularly – During weekly one-on-ones and quarterly business reviews, I have a habit of checking in with account executives about workload and bandwidth. Early warning signs of imbalance include absenteeism, sudden changes in sales activities tracked in the CRM, and a high frequency of dropped potential leads. I do my best to address those early warning signs immediately.
- Recalibrate Metrics as Market Conditions Shift – If a once-hot sales territory shows signs of saturation, I recalibrate sales quotas, and sales goals downward to reflect the reality. Conversely, I ramp up sales goals when new opportunities emerge like a key industry player entering a sales territory or new buyer demand.
- Realign Resources Proactively – If sales territories grow chronically imbalanced, rebalancing means reallocating resources and accounts between outside and inside sales teams. In my experience, this can be disruptive if not handled transparently so communicate the rationale with your sales team clearly.
3. Foster collaboration between territory sales teams.
While sales territories operate autonomously day-to-day, in my experience, facilitating collaboration across a sales team is vital for optimizing broader sales strategies long-term.
Here’s what I do to promote cross-territory sales team collaboration and teamwork:
- Share Best Practices Across Territories – Provide forums for your sales team to share successes. Whether in weekly sales team meetings or online communities, this transfers proven tactics between field sales teams rapidly. Our sales team works fully remote so we use a dedicated Slack channel and also Google Meet for that. Sales representatives discuss specifics like new leads prospecting approaches, common customer pain points, pricing strategies, and competitive intel unique to their sales territory. We also have a sales training library of short Video PDFs that we created based on the insights that we gathered. This makes it easier to keep everyone on the sales team up to date on the best practices and makes it so much easier to onboard new account executives.
- Cross-Pollinate Insights on Customer Needs – My goal is to help my sales team understand broader customer needs beyond their geographical area or vertical. Customers often have similar underlying challenges. For example, an eCommerce sales organizations can share optimization insights relevant for a financial services territory. This big picture view strengthens customer advisory skills beyond just selling.
- Incentivize Joint New Leads Prospecting – To foster collaboration, I always start with account mapping and compensation rules that reward sales reps collaborating to co-sell into new accounts spanning territories. This prevents siloed thinking and tendency to only pass off accounts begrudgingly. In my experience, shared wins encourage sales team collaboration.
- Use Technology to Increase Transparency – I highly recommend you use a CRM in conjunction with an internal communication platform like Slack and collaboration tools to break down information silos between field sales teams and inside sales teams. When all customer data, playbooks, and expertise are accessible, seamless sales collaboration follows.
4. Create visit schedule and sales activities for each sales territory.
Establishing consistent visit schedules and outreach cadences is crucial for sales territory operations effectiveness. Based on my experience, sales activities can turn into random actions in the absence of a structured sales territory management plan.
- Map Out a Visiting Calendar – Work with your sales team to build a monthly or quarterly calendar for onsite meetings with key accounts in their sales territory. Balance appointment requests across days and weeks. Bunching field visits on certain days is inefficient. Block time for travel and post-meeting follow-ups to avoid overscheduling.
- Define an Ongoing Activity Cadence – Beyond field visits, build a template for overall outreach like phone calls, emails, and mailed promotions. Mapping out monthly, weekly, and daily activities provides structure for your sales team to execute consistently.
- Set Baselines but Customize as Needed – While a standard structure is helpful, customize engagement cadences based on each account’s needs. Key variables include deal stage, customer lifecycle, and buying seasonality. Account executives should oversee customization.
- Leverage CRM for Visibility – Use your CRM activity tracking to ensure sales reps adhere to the established visiting and activity cadences. Reviewing the CRM provides visibility allowing for quick intervention when execution falls off track.
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5. Incentivize sales teams to prospect for potential leads in their assigned sales territories.
From what I’ve noticed, relying solely on assigned sales territories and sales goals often fails to reliably drive new leads prospecting intensity. That’s why I highly recommend that every sales territory manager and their sales organization needs to get creative with incentives.
Here are some proven incentives that many of my territory sales manager friends use to ignite new territories development:
- Offer Incremental Spiffs for New Opportunities – They always provide incremental monetary spiffs for account executives hitting specific new leads prospecting milestones like opening 10 net-new opportunities. As sales representatives approach milestones, the incentive effect would kicks in. This structures autonomy with motivation.
- Recognize Top Prospectors Publicly – They always call out top performers opening valuable new accounts during all-hands meetings. Public recognition for exceeding new leads prospecting activities established in territories goes a long way. In my experience, this usually leads to a friendly peer competition as sales reps motivate each other.
- Incentivize Cross-Territory Introductions – Monetarily rewarding sales representatives for making introductions to peers in other territories that result in closed deals always worked for me. This incentivizes sales representatives to think beyond their geographic location and proactively leverage broader company and customer relationships.
- Help Sales Reps Showcase Prospecting Wins – Enable sales representatives to demonstrate prospecting success by presenting new strategic account openings in management review sessions. From what I’ve noticed, this exposure accelerates account executives’ careers and stokes their passions for new territories development.
6. Provide ongoing sales team training.
In my experience, even the most seasoned territory sales reps require continuous sales skills development and education as markets evolve. Stale knowledge cripples sales territories.
Here’s how sales territory managers can provide effective ongoing sales team training:
- Mandate Time for Training – I always recommend building sales training time into territory sales reps’ schedules. Don’t just expect learning during “free time.” Dedicated sales training time conveys its importance. Sales training complements fieldwork instead of competing against billable priorities.
- Customize Sales Training to Sales Territory Needs – Tailor sales training based on the maturity level, product mix, and customer profiles within each sales territory. For example, new territories may require extensive product level-setting while mature ones need advanced objection handling.
- Get Input from Account Executives on High-Return Topics – I highly recommend you solicit input from territory sales representatives on the skills and knowledge they deem most crucial for their continued success. In my experience, empowered sales representatives take more ownership of their development when able to influence the curriculum.
- Incorporate Peer-to-Peer Learning – Have top performers conduct peer learning sessions to not only share tactical best practices but also mentor emerging talent. Based on my observations, this fosters coaching skills in your veterans while allowing new sales representatives to learn from field experience versus manuals alone.
- Make Sales Training Ongoing, Not Just Onboarding – I’m a big proponent of continuous sales training. I think it must be ingrained in territory sales team culture, not just during onboarding. Markets move too fast for set it and forget it learning.
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7. Leverage CRM, sales routes optimization, and sales territory mapping software.
The right tools are an accelerant for efficient sales territory operations, providing enhanced visibility and automation capabilities. From having done this for so long, these are the sales tools that I highly recommend you include in every sales territory management plan:
- CRM – A CRM centralizes key account, contact, and opportunity data. Integrations with email and calendar provide a unified command center for territory sales reps. Dashboards visualize key performance indicators and help spot trends across territories.
- Sales Routes Optimization – Sale routes optimization tools generate efficient travel routes between multi-stop field visits. This minimizes windshield time allowing more customer face time. Most sales territory mapping software offer integrations with CRM sales data to automatically optimize routes based on scheduled appointments.
- Sales Engagement Platforms – These tools track sales collateral and email cadences and provide automation for repetitive prospect outreach like sequences. This increases consistency and freed capacity. Integrations with marketing automation and CRM create transparency on engagement effectiveness.
- Business Intelligence – Leverage BI tools to create dashboard roll-ups on sales territory metrics like sales cycle trends, churn predictors, and white space analysis. Real-time sales data visibility informs sales strategy adjustments and keeps territory sales managers smart on what’s working.
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8. Divide sales territories to accommodate growth and new hires.
As businesses scale, sales organizations need to divide sales territories and expand their sales teams to capitalize on new opportunities.
Having done this before, here’s how I recommend you can smoothly divide sales territories to accommodate growth and new hires:
- Plan New Territories Proactively – Forecast 12-18 months out based on sales pipeline health, product launches, and market trends. Create tentative new sales territory mappings in advance versus reacting to overload. In my experience, this delays disruption until necessary.
- Phase Sales Territory Plan Gradually – When launching new territories and onboarding new sales representatives, don’t do an immediate full-scale rollout. I always start with a pilot sales territory or setup an interim splits model to test viability before making irreversible moves.
- Temporarily Resize Existing Sales Territories – When adding new sales reps, I always shrink existing sales territories to carve out space versus immediately drawing hard new sales territory lines. This provides flexibility to adjust if the new sales rep leaves unexpectedly before fully testing the new sales territory management plan.
- Communicate Rationale for Sales Rep Assignments – When hiring new sales representatives, explain the rationale for sales territory assignments relative to factors like experience level and role type. In my experience, transparency always reduces perceptions of unfairness and builds trust in sales leadership decisions.
- Solicit Feedback on Sales Territory Hand-offs – When handing off current accounts between account executives, I always do my best to collaborate to align on a transition plan and minimize disruptions. Both sales representatives will likely have ideas to improve the account transitions.
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9. Maintain sales team accountability through consistent monitoring of sales goals.
Setting sales goals is easy, but in my view, the real work comes in holding sales teams accountable to achieving them.
Here’s how I usually set measurable goals and keep my sales team accountable:
- Monitor in Real-Time – I leverage CRM, marketing automation platform, and BI tools to monitor milestone progress in real-time instead of rearview mirror quarterly reviews alone. Real-time visibility into performance-to-target enables mid-course corrections versus post-mortems.
- Automate Alerts on Critical Leading Indicators – For key territory health metrics like sales activities, sales pipeline conversion rates, and contract renewals, automate alerts when thresholds are breached. In my experience, this prompts immediate coaching conversations versus waiting for routine reviews.
- Communicate Expectations Clearly – Leave no room for ambiguity on revenue expectations and required sales activities like phone calls and events per week. I highly recommend you document expectations and reference regularly in sales coaching discussions.
- Customize Metrics to Sales Reps’ Strengths – If a sales rep excels at big whale hunting but trails on preferred lead gen activities, consider customizing their measurable goals accordingly. From my perspective, personalization accommodates different skills while upholding standards.
- Conduct Regular Performance Reviews – Try to have consistent one-on-one meetings with territory sales reps to review sales goals and address any barriers to execution. Discussion frequency matches pace of business – once a week for fast-changing startups or monthly for established enterprises.
Territory Sales Management Example - Grouping by Customer Industry
One sales territory management planning approach, in my experience, works extremely well is organizing sales territories by customer industry rather than geographic location.
A B2B software company I consulted with was struggling with growth. Their account executives had broad geographic areas covering all major industries in each region. Sales representatives lacked the industry expertise to hold strategic conversations.
We worked together to completely restructure sales territories by industry vertical. Sales representatives were assigned territories aligned to their expertise – healthcare, manufacturing, financial services etc.
This industry focus yielded dramatic results for this sales organization:
- Account executives tailored sales pitches using industry terminology prospects understood and valued. Meetings were perceived as more strategic.
- Issues and use cases relevant to each vertical dominated conversations versus generic software features.
- Industry-specific competitive win stories resonated better with prospects.
- Sales representatives identified upsell opportunities within current accounts they may have missed previously across industries.
- Average deal sizes increased by over 2x in the first year as account executives unpacked industry-specific ROI scenarios.
- Key industry conferences became focal points for potential leads prospecting within each sales territory.
Judging by what I’ve encountered in my time in B2B sales, transitioning to the new structure initially required extensive sales training and shuffling of current accounts, the impact on customer perception, domain expertise, and deal sizes made the temporary disruption worthwhile.
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Importance of Adapting Your Sales Strategy to Changes in the Market
Effective sales territory management requires territory sales managers to stay vigilant for changes requiring sales strategy pivots.
I always look for market shifts like new competitors, disruptive products, industry consolidation, and regulatory impacts. Major changes often warrant sales territory realignment to address threats or capitalize on opportunities.
Check in with your sales team often to understand trends in prospect needs, buying criteria, and areas of spend. Modify sales territories and strengthen sales training to address customer changes.
As your sales team evolves through attrition and new hires, revisit sales territory alignment to current sales team strengths. As I’ve noticed, periodic rotations prevent stagnation. Rebalance workloads if bottlenecks emerge.
Don’t just make incremental tweaks on legacy maps if outcomes indicate the need for an overhaul. Full redesigns keep sales territory strategies aligned to market realities and resources.
Approach sales territories as dynamic versus fixed constructs. Expect frequent changes in parameters. Agility is required to keep territories optimized in fast-changing, competitive markets.
FAQs: Sales Territory Management Tips
What are the main benefits of sales territory management?
Sales territory management increases sales productivity and win rates, lowers costs, improves forecasting accuracy and specialization, ensures workload balance, reduces churn and travel expenses, and keeps reps motivated by aligning new opportunities, resources and sales goals within set geographic or account segments.
How do you get started with defining sales territories?
Begin defining sales territories by analyzing customer data to spot geographic location, industry, or other clusters. Map current prospects and customers visually after cleansing sales data. Determine sales territory planning approach and parameters. Involve sales reps to fine-tune alignments.
What data should you analyze during sales territory planning?
Key data to analyze during sales territory planning includes customer attributes like industry, location, and purchase history, sales metrics by region, market data on prospects and customers, competitive intelligence, sales capacity, and operational costs.
How many sales territories should a sales team have?
The ideal number of sales territories depends on factors like total addressable market size, sales rep capacity, geographic dispersion of customers, territory management span of control, and desired workload balance. Most experts recommend between 5-15 territories on average.
What are some common approaches for structuring sales territories?
Common approaches for structuring sales territories include geographic, industry or product specialization, customer type/size, lead source, hybrid models, or assigning based on sales rep strengths and expertise. The best sales structuring approach aligns to your sales model.
How do you effectively assign sales territories to sales reps?
Effective sales territory assignment involves matching sales rep skills to opportunity profiles, distributing territories fairly by indicators like workload and revenue, developing account transfer processes between territories, and soliciting ongoing rep feedback.
What criteria should be used to evaluate and adjust sales territories?
Criteria to evaluate and adjust sales territories should include revenue attainment, sales activity levels, workload balance, travel time efficiency, customer retention, win rates, growth signals, and competitive threats uncovered through sales rep discussions.
How often should a territory sales manager reassess sales territory alignment?
Every territory sales manager should reassess sales territory alignment at least annually, but more frequently – quarterly or monthly – is better for fast-moving sales environments. The cadence depends on market dynamism and shifts.
What territory management software is essential for managing sales territories?
Essential technology for managing sales territories includes CRM, routing and territory mapping software, sales engagement platforms, business intelligence, and sales data visualization tools to gain insights, optimize sales territory alignment, automate workflows, and boost sales productivity and sales performance.
How can you use incentives to motivate sales reps by sales territory?
Motivate sales reps through sales territory-based incentives like spiffs for new sales opportunities, public recognition hitting new leads prospecting goals, rewards for cross-territory referrals, and opportunities to present achievements in reviews.
How do you balance workload across multiple sales territories?
Balance workload across sales territories by setting sales quotas based on potential, monitoring activity rates, reassigning current accounts, adding support roles, and optimizing sales territory radius and alignment.
What are some warning signs that sales territories need to be rebalanced?
Warning signs territories need rebalancing include wide sales quota attainment gaps between territories, account neglect complaints, activity and sales data mismatches, travel time inefficiencies, and sales rep burnout or churn.
How can you reduce travel time and costs through better sales routes and sales territory planning?
Reducing travel time and costs comes through sales territory planning strategies like tight geographic clustering of accounts, consolidating fragmented territories, optimizing sales routing paths using sales territory mapping software, and sizing territories based on capacity.
How can specialized sales territories increase average deal sizes?
Specialized territories increase average deal sizes by enabling sales reps to develop deep expertise in niche needs and build relevance. This leads to larger, higher value orders and improved pricing leverage versus a generalist sales strategy approach.
What is the best way to onboard sales reps on new sales territory alignment?
The best way to onboard sales reps on new sales territory alignment is through transparent communication on rationale, customized sales training on assigned sales territory, collaborative hand-offs, staggered rollouts, and consistent feedback solicitation to identify improvement areas.
About the Author
Our content team of sales, lead generation, and marketing experts provides industry-leading thought leadership on B2B sales and marketing, lead nurturing, and sales enablement strategies. With decades of combined C-suite and VP-level experience, we deliver actionable B2B sales and marketing content that gives B2B companies a competitive advantage. Our proven insights on lead management, conversion rate and sales optimization, sales productivity, and tech stack empower companies to increase revenue growth and ROI.
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