Sales Territory
A defined segment of the market assigned to a salesperson or team, based on geography, industry, account size, or product line.
Also known as: Territory management, Territory planning, Account assignment
Category: Business & Economics
Tags: businesses, sales, planning, organizations, strategies
Explanation
A sales territory allocates the market so that every account has one owner and no rep competes with a colleague for the same deal. Territories can be drawn by geography, industry vertical, company size, named account list, or product line. The choice reflects the motion: vertical territories build genuine domain expertise and suit complex sales, geographic ones suit field sales where travel matters, and named-account lists suit enterprise coverage of a small number of large targets. Good territory design balances potential rather than account count, because a territory containing three enormous prospects and one containing three hundred small ones are not comparable assignments even if the headcount is equal. Poor design is expensive and quietly so: unbalanced territories cause the best reps to miss quota through no fault of their own, drive attrition, and distort the read on whether the sales process works. Territories also need a change process, since redrawing them mid-year disrupts relationships and in-flight deals, while never redrawing them lets coverage drift away from where the market has moved.
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