The Importance Of Effective Management

Published Date: 02 Nov 2017

Summary

This article is a theoretical approach to management of sales territory by force. The central element is how agents split their efforts between the activities and routes in charge. A related issue is to determine what comes first - defining the territory that is sold or completion of the sale. Interaction effects of body size by sales agents and defining the territory covered by these influences measuring individual elements that contribute to business performance.

Keywords

Working time, potent partly the market , method of delimitation of territories by accumulating delimiting territories decomposition method, time management.

Fundamentals of delimitation of territories

Separates commercial territories to help agents sell more effectively. Delineation is done by allocating a number of existing and potential customers for each sales agent acting in a given area, usually set, but not always, on geography. Reasons for delimiting territories shall be made and the criteria that may vary greatly from case to case. The division into business areas is not necessary or useful in any situation. Reasons against these boundaries may occur in the case of sales to friends and social contacts, or with references received from other existing customers, as is the case with insurance companies or financial investment. Another reason against the existence of territories that could be the size of the market, the small number of customers or sales agents do not justify such a division. Where not readily available information about potential customers or where is still unknown how a new product will be accepted, managers should expect to delimit territories until these issues are cleared.

Most commercial companies establish their territories in one or more of the following reasons:

• To thoroughly cover the entire market. Territories to identify existing or potential customers in a given area, reducing the possibility of failure of any business opportunities or overlapping contacts and helping, therefore, to avoid excessive transport costs.


• To define more precisely and specifically the responsibilities of each salesperson based on the boundaries can be made easier classification of accounts by name, number and frequency of contacts.


• As a means of doing performance assessment tion works . commercial statements reported in previous periods, the plan or to some extent the potential are easily prepared and more accurate when referring to a well-defined territory. Sales managers can also make comparisons between regions, from which to realize how it could improve their entire sales staff.


• To improve customer relationships. sales agents in a given area can learn more about their customers and establish a closer relationship with them, visiting them regularly, which in itself is a source of savings time. Avoid excessive contact but wasting time with too many courtesy visits.


• To reduce the costs of sale. number of travel and related costs are much lower if located in the same territory. For this reason, most companies insist that their salesmen to be resident in the territories they cover.


• To better align the business of selling to customer needs. This is done for various reasons related to the site, such as knowledge of local conditions and customs. Again, the similarity between salespeople and their potential customers can be very important.


• To help salespeople work. demarcation of the territories helps to better coordination between different departments of a company between activities specific marketing and advertising undertaken by it, while contributing in a positive way to sustaining morale and motivate salespeople, and managers makes them territories they cover.

Most convincing reason is that the territorial delimitation facilitate the implementation of the marketing concept, contributing to a better identification of customer needs and enabling accurate performance of actions to meet them.

The environment in which the sales today, the ability to conduct an effective management of territories is becoming increasingly important, which is provided to achieve optimum sales in terms of costs.

Generally accepted procedure for establishing commercial territories through the following five phases :

Phase I: The choice of the base

To define the best territories, choose a starting point to build on various existing divisions, such as economic regions or coverage areas of different TV channels. Different density of population, the income gap and industry specific make these divisions are not equivalent in terms of their commercial potential. Where possible, it is advisable to establish a starting unit as small, because then you can create larger commercial areas by merging several divisions of this type. Market characteristics, distribution systems and prestige of the company are important factors of influence than mere geographic boundaries.

Phase II : Evaluation of potential commercial accounts and

Systems can provide information on markets all data needed for decision in this regard. Where to obtain accurate information about market and customers, territories composition will be relatively easy. This involves classifying all potential customers in different categories such as track yet unverified existing customers, past or future. The advantages of using computer systems are reflected in the ability to quickly select potential accounts after a number of relevant features. Computers can use and store information on the status of accounts at their fair value and potential. Most companies divide their accounts according to an ABC-type classification: A = very important accounts, accounts of important B = average C = accounts less important.

Phase III : Analysis of normal working sales people

Workload of the agents is an estimate of time and effort needed to cover the geographical territory assigned. This estimate includes the number of accounts of different types, frequency of contacts, time for everyone, time travel of contacts and time spent with commercial activities.

Difficulties may occur when calculating normal value range:

• Type of sale. Salespeople can handle the development and consolidation of an account, which requires on average longer than servicing existing accounts. They can be placed in a position to contact more people in the same account, while in others, not only to meet with the buyer itself. Some sales require the deployment of a missionary or development activities, while in others may need a larger scale promotional activity.


• Type of product. fast moving consumer goods require fewer explanations or demonstrations than technological products. Work in this area is under recurrent after some established patterns, almost routine. But some industrial or other special goods whose benefits require a more thorough, which makes such visits take longer.


• Novelty products or markets. If markets or products are developed, is expected to need more time for each visit and to make fewer sales in each account or accounts than existing products. Accounts grow over time and a greater number of accounts mean higher workload, develop a territory than it takes to achieve the same volume of sales in established territory.


• The share of market position and competitive advantage of its business in that territory. If competitors are already well placed in that market, sales agents work to maintain each account will be more difficult and usually will require much more time. Most companies have a bigger market share at home, so salespeople task is substantially more difficult when they have to work in regions further from headquarters. It can happen that some agents have even better results in such conditions, but this may be caused by a higher efficiency than the distributors of their own territory as traders.

Phase IV : The delimitation of territorial units for b lights the

The objective of this phase is to determine the commercial potential of the agent is employed in a given area. This potential is in turn linked to the objectives of the sales staff. As for sales forecasts, you can use two different methods: calculation method by accumulation and decomposition method.

The procedure is as follows:

A. To determine the number, size and location of customers, taking account of current accounts, past and potential. These accounts can be properly classified and grouped, such as size or other criteria which.

Two. Determine the number of contacts required for each account, each time they take and the frequency of visits.

Three. Calculate how many accounts can serve each salesperson. It is useful to use an ABC-type classification. Specifically, it will get an average of contacts to be made daily average frequency for each account and, if possible, and the average time spent on sales in each case.

Four. Draw the lines, thinking about a realistic volume of work which is proportional to the basic geographic unit.

The method of calculating the accumulation can be applied using a computerized system. Knowledge about each customer obtained from data collected during the contacts can be used to maintain customer information file (Vavra, 1992). Such assumptions are often difficult to sustain in practice. Or, conversely, managers can adopt spatial planning decomposition method : starting from a nationwide estimate of market potential and market share, potential sales can be appreciated, this estimate is then divided by the number of people available (or that can be recruited), finally, to set boundaries geographical realistic. The drawback with this is that trying to equalize the commercial potential of the territories, there is a difference in the volume of work, which makes geographical boundaries no longer realistic. This problem is the further variation fluctuating market conditions and efficiency of distributors, so this method proves quite simplistic, in fact, very complicated.

Phase V : Distribution of sales agents in territories

After establishing territories, they must be allocated to individual salespeople. They may be different in level of knowledge, skill and ability, which makes some of them to be more effective than others. Practice shows how important it is to find sales agents to match the customers, but in addition there are many other factors that allow them to be effective. The task manager is to put these variables in order of priority, even seeking to improve the individual, if not to find the optimum. Differences in skills and the desire or inclination to deal with agents from other areas than those assigned to them may require the use of compromise, which, although not optimal, are still applicable.

Time management

Most improvements in this respect can make themselves agents through better discipline and professionalism. Of possible improvements, we can mention:

• workday to start earlier and end later;


• Fewer discussions;


• Fewer breaks;


• Fewer protocol actions.

An effective time management means:

• A better planning of work;


• Fewer visits to potential customers uncertain or unimportant;


• A better use of time traveling and waiting;


• A more intensive use of the phone, including establishing the list of meetings.

Factors to be considered salespeople when you distribute working time include:

• moments in official documents to be prepared;


• duration of each visit;


• travel times;


• Number of visits;


• The order of visits;


• Time development of new relations;


• The time taken for commercial activities;


• Time is lost making conversation with customers.

As appropriate would be to allow each salesperson to manage your own time, managers must not only monitor but also to stop misuse of time and promote more effective practices to make sales.

Conclusions

An optimal territorial delimitation has the following features:

• territories are easy to administer;


• potential sales is relatively easy to estimate;


• travel time and expenses are minimized;


• provides a homogeneous distribution of opportunities to sell products among existing and potential customers;


• Work rules are equalized.

The most important factors to be taken into account when establishing territories are market potential, concentration and dispersion accounts.

Bibliography

A. Armstrong, GM (1976) "SCHEDULE The model and the salesman's effort Allocation", California , Management Review, 17 (4): 43-51;

Two. Cravens, DW, Woodruff, RB, Stamper, JC (1972) "An analytical approach for Evaluating Sales Territory Performance", Journal of Mark eting , 36 (I): 31-37;

Three. Donaldson, B. (2001) Management of sales. Theory and Practice , Ed Codecs, Bucharest;

Four. Parasuraman, A., Day, RL (1977) "A management-oriented model for allocating sales effort", Journal of Marketing Research , XIV (February): 22-23;

Five. Ryans, AB, Weinberg, CB (1979) "Territory sales response", Journal of Marketing Research, XVI (November): 453-465;

6. Vavra, TG (1992) Aftermarketing: How to Keep Customers for Life Through Relationship Marketing , Homewood, IL: Irwin.