The allocation of sales territories must be given serious thought by the sales manager as it is one of the important tools of control. It does not pose a problem for the small organisations because their market is limited.
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For big organisations operating in national and even international market for their goods and services, it poses a big challenge to the sales management. The main object of allocation of sales territories can be summarised as follows:
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1. To hold the salesman responsible for sales and services,
2. Supervise and control over the sales force,
3. To compete in the competitive market easily, and
4. To save time and expenses.
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There are several advantages of allocation of sales territories and following are some of the important advantages:
1. By appointing a salesman or a group of salesmen for a particular territory, the company is able to serve his customers more satisfactorily.
2. Comparison among salesmen is possible and can be easily made. This is so because there is equitable distribution of territories among equally competent salesmen.
3. By allocating sales territories, the entire sales field of a particular organisation can be covered quickly.
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4. Assignment of a particular territory to a particular salesman makes the sales force to work hard, as the man working in a particular territory has fixed selling targets before him.
5. By assigning pre-determined sales territories, the sales manager instills the element of competition among the sales force. Competition among salesmen definitely results in more sales.
6. The inefficient salesmen are easily found out by the sales organisation.
7. The organisation is able to know sales potentialities of each area. Therefore comparison among sales areas is possible.
8. The allocation of sales territories restricts the area of operation of the salesman to given geographical area. This helps to develop friendly relationship between the salesman and the customers. This helps the salesmen to increase their sales volume.
9. Market survey can be easily and quickly done when a company has its sales territories properly divided among its salesmen.
10. Allocation of sales territories ensures adequate market coverage and avoids duplication of sales efforts.