1. 15-1

2. Time, Territory, and Self- Management: Keys to Success Chapter 15 Copyright © 2006 by The McGraw-Hill Companies, Inc. All rights reserved. McGraw-Hill/Irwin

3. Chapter 15 15-3

4. Main Topics The Tree of Business Life: Time Customers Form Sales Territories Elements of Time and Territory Management Chapter 15 15-4

5. 15-5 The Tree of Business Life: Time The Golden Rule Guided by The Golden Rule:  View your territory as a business  Treat customers differently depending on their needs  Value the customer’s time  Realize that how you spend your time determines your life  Use your life to serve others and enjoy a wonderful, fulfilling life  Seek, knock, ask, serve, and see that ethical service build true relationships I T C Ethical Service Builds T r u e Relationships T TT TTTT TTTT

6. 15-6 Customers Form Sales Territories  A sales territory comprises a group of customers or a geographical area assigned to a salesperson

7. 15-7 CA NV OR WA ID MT AZ UT CO NE NM TX OK KS MO AR WY ND SD MN WI IA MI ILIN OH KY TN LA MS ALGA FL SC NC VA WV PA NY ME VT NH CT MA NJ MD DC DE WEST COAST SOUTHEAST MIDWEST (IL Accts A-L) NORTHEAST MID-ATLANTIC NATIONWIDE Vertical Market Managers (Pharma, Incentive & SMERF) Updated 1-10-06 (IL Accts M-Z) IL is split between

8. 15-8 Exhibit 15-1: Reasons Companies Develop and Use Sales Territories

9. 15-9 Why Sales Territories May Not Be Developed  Salespeople may be more motivated if not restricted by a particular territory  The company may be too small to be concerned with segmenting the market into sales areas

10. 15-10 Exhibit 15-2: Elements of Time and Territory Management for the Salesperson Salesperson’s territory’s sales quota

11. 15-11 Elements of Time and Territory Management  Salesperson’s sales quota (goals) may involve:  Sales volume quotas  Profit quotas  Expense quotas  Activity quotas  Customer satisfaction scores

12. 15-12 Salesperson’s territory’s sales quota Account analysis Exhibit 15-2: Elements of Time and Territory Management for the Salesperson, cont…

13. 15-13 Elements of Time and Territory Management, cont…  Account analysis:  The undifferentiated selling approach (Exhibit 15-3)(Exhibit 15-3)  Using the same selling approach because all targeted accounts are exactly he same  The account segmentation approach (Exhibit 15-6)(Exhibit 15-6)  Used because accounts needs & characteristics are different and require different selling strategies. Ex) Key accounts, Unprofitable & regular accounts.  ELMS system  80/20 principle  20% of accounts produce 80% of revenue  Multiple selling strategies  Ex) sales force structure may be designed to meet the companies key accounts (largest producers).  Multivariable account segmentation (Exhibit 15-7)(Exhibit 15-7)  Using more than one criterion to characterize the organization’s accounts.

14. 15-14 Exhibit 15-3: Undifferentiated Selling Approach Slide 15-11

15. 15-15 Exhibit 15-4: Account Segmentation Based on Yearly Sales

16. 15-16 Exhibit 15-5: Basic Segmentation of Accounts

17. 15-17 Exhibit 15-6: Account Segmentation Approach Slide 15-11

18. 15-18 Exhibit 15-7: Multivariable Account Segmentation Slide 15-11

19. 15-19 Salesperson’s territory’s sales quota Account analysis Set account objectives and sales quotas Exhibit 15-2: Elements of Time and Territory Management for the Salesperson, cont…

20. 15-20 Elements of Time and Territory Management, cont…  Set account objectives and sales quotas which may involve:  Sales volume quotas  Profit quotas  Expense quotas  Activity quotas  Customer satisfaction scores

21. 15-21 Salesperson’s territory’s sales quota Account analysis Set account objectives and sales quotas Territory-time allocation Exhibit 15-2: Elements of Time and Territory Management for the Salesperson, cont…

22. 15-22 Elements of Time and Territory Management, cont...  Territory-time allocation  How does the salesperson allot their limited time within their respective territories?  Basic factors to consider  Number of accounts in the territory  Ex – GSO vs Local sales person  Number of sales calls made on customers  Time required for each sales call  Frequency of customer sales calls  Travel time around the territory  Nonselling time  Return on time invested  Sale response function (See up coming slide)

23. 15-23 Exhibit 15-8: Account Time Allocation by Salesperson * every 3 months

24. 15-24 Elements of……………….  Territory-time allocation  Basic factors to consider  Sales response function  The salesperson invests sales time in direct proportion to the actual or potential sales that the account represents  The most productive number of calls is reached at the point at which additional calls do not increase sales  The relationship of sales volume to sales calls is the sales response function of the customer to the salesperson’s calls

25. 15-25 Return on Time Invested  Time is a scarce resource  Must use time wisely in order to improve and maximize territory productivity  Break-even analysis  The quantitative technique for determining the level of sales at which total revenues equal total costs  The management of time  Plan by the day, week, and month  Qualify the prospect  Use waiting time  Have a productive lunchtime  Records and reports

26. 15-26 Exhibit 15-10: Daily Customer Plan

27. 15-27 Salesperson’s territory’s sales quota Account analysis Set account objectives and sales quotas Customer sales planning Territory-time allocation Exhibit 15-2: Elements of Time and Territory Management for the Salesperson, cont…

28. 15-28 What is Involved in Customer Sales Planning?  You do the following for each sales call:  Develop sales call objectives  Review/create customer profile  Create customer benefit plan  Select FABs  Develop marketing plan  Develop business proposition  Develop suggested order  Develop your sales presentation

29. 15-29 Salesperson’s territory’s sales quota Account analysis Set account objectives and sales quotas Scheduling and routing Customer sales planning Territory-time allocation Exhibit 15-2: Elements of Time and Territory Management for the Salesperson, cont…

30. 15-30 Scheduling and Routing  Strict formal route designs enable the company to:  Improve territory coverage  Minimize wasted time  Establish communication between management and the sales force in terms of location and activities of individual salespeople  Carefully plan your route

31. 15-31 Exhibit 15-11: Location of Accounts and Sequence of Calls

32. 15-32 Exhibit 15-12: A Weekly Route Report

33. 15-33 Exhibit 15-13: Three Basic Routing Patterns

34. 15-34 Salesperson’s territory’s sales quota Account analysis Set account objectives and sales quotas Territory and customer evaluation Scheduling and routing Customer sales planning Territory-time allocation Exhibit 15-2: Elements of Time and Territory Management for the Salesperson, cont…

35. 15-35 Using the Telephone for Territorial Coverage  Satisfy part of the service needs of accounts by telephone  Assign smaller accounts that contribute less than 5 percent of business to mostly telephone selling  Do prospecting, marketing data gathering, and call scheduling by telephone  Carefully schedule personal calls to distant accounts

36. 15-36 Exhibit 15-15: Net Sales by Customer and Call Frequency: May 1, 2005

37. 15-37 Territory and Customer Evaluation  Did the salesperson meet sales quota(s)?  Sales volume quotas  Profit quotas  Expense quotas  Activity quotas  Customer satisfaction scores

38. 15-38 Salesperson’s territory’s sales quota Account analysis Set account objectives and sales quotas Territory and customer evaluation Scheduling and routing Customer sales planning Territory-time allocation Exhibit 15-2: Elements of Time and Territory Management for the Salesperson, cont…

39. 15-39 Summary of Major Selling Issues  How salespeople invest their sales time is a critical factor that influences territory sales  Proper time and territory management is an effective method for the salesperson to maximize territorial sales and profits  A sales territory comprises a group of customers or a geographical area assigned to a salesperson

40. 15-40 Summary of Major Selling Issues, cont…  Companies develop and use sales territories for a number of reasons  Performance can be monitored when territories are established  There are also disadvantages to developing sales territories  Time and territory management is continuous for a salesperson – it involves seven key elements

41. 15-41 Sales Presentation Guidelines

42. 15-42 Sales Presentation Guidelines  The Approach  Introduction--rapport building.  Use statement, demonstration, and/or questions.  Make smooth transition into presentation.  Remember: be positive, appearance, firm handshake--smile, look'em in the eyes.  2. Presentation  Product (incorporating S.E.L.L.)  use SELL to uncover further needs and/or confirm needs stated in approach by having buyer negatively and/or positively answer your trial closes.  use proof statement.  use simile, metaphor, or analogy.  use demonstration.  use numerous visuals.  Marketing Plan (incorporating SELL)  tie back into benefits. Very important to do.  Business Proposition (incorporating SELL)  use one or more value analysis, ROI, discounts, markups, promotional & allowances.  tie back into benefits. Very important to do.

43. 15-43 Sales Presentation Guidelines  Multiple Closing Sequence  NOTE: You are required to have at least two closes and thus need to develop a multiple-closing sequence.  summarize benefits of interest to buyer.  ask a trial close.  discuss suggested order.  first close - ask for business.  objection occurs.  second close.  objection occurs.  third close.  continue if appropriate.  Completion  Sale Made, Exit Script  No Sale Made, Exit Script  be positive, natural and polite.  leave with a firm handshake--look 'em in the eyes.  Establish the next step in either the sales or no sale  Communicate the next step and when follow-up will occur

44. 15-44 Sales Presentation Guidelines  IF YOU DO NOT SELL PROSPECT  Create an ‘Exit Script’ around the following guidelines:  Don’t give up. As you are collecting your stuff, say something like:  “Mr./Mrs. Prospect, would you do one thing for your company?”  “Look over…” describe material you are leaving.  “Please call if you feel (your product) will fill your needs. I feel it will!”  Stand up.  Shake hands—look’em in the eyes and smile.  Be positive, enthusiastic! Say something like:  “Thank you very much for your time,” and/or  “I really enjoyed visiting with you.”  In leaving, act as a professional.  Do not take it personally.  Remember the prospect lost out, not you.  You leave the door open by:  Knowing your product,  Being friendly after a “no sale.”  If still a prospect, you will be back.  You are there to unselfishly help the person and his/her company. If you feel your product is needed by the prospect, you would follow-up with a telephone call a few days later. A letter might follow the telephone call.