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Contemporary Selling, 5e
Chapter 10
Chapter 10 Outline: Salesperson Self-Management
Value-Added Information in Chapter
• Global Connection – “Sales Reports in a Consumer Food Products Company”
• Exhibits
o Exhibit 10.1 – “Why Time and Territory Management Is Important”
o Exhibit 10.2 – “Priority Checklist”
o Exhibit 10.3 – “Take Control of Your Life”
o Exhibit 10.4 – An Ad for TerrAlign
I. The Importance of Salesperson Self-Management
A. Reasons for Salespeople
1. Increase Productivity
B. Reasons for Sales Managers
1. Ensure Territory and Customer Coverage
2. Minimize Sales Expenses
II. Salespeople’s Role in Salesperson Self-Management
A. Efficient Time Management
1. Identify Personal and Professional Priorities
2. Develop a Time Management Plan
a) Daily Event Schedule
B. Effective Territory Management
1. Develop a Territory Management Plan
1. Step 1: Select the Basic Control Unit
a) Counties
2. Step 2: Estimate Market Potential
3. Step 3: Perform Workload Analysis
a) Account Analysis
b) Criteria for Classifying Accounts
4. Step 4: Define Sales Territories
5. Step 5: Assign Salespeople to Territories
B. Measure Sales Territory Performance
1. Sources of Information for Sales Analysis
IV. Summary
V. Key Terms
Role Play
For a little variety, this role play allows one student to play any account manager he or she
chooses. The account manager will interact with Rhonda Reed to develop a personal plan for
Hints for the Instructor:
• This role play is a great opportunity to bring home the importance of salespeople and
their managers working together to develop personal development plans.
• It would be ideal if each student in a dyad develops his or her own set of bullet points for
discussion. When the students meet, they can use the role-playing dialogue to go over
each person’s ideas and come to a consensus on what the most appropriate set is for the
account manager selected.
Discussion Questions
1. Suppose you are a salesperson working 50 weeks per year, five days a week, eight
hours a day. You want to make $50,000 per year, which is based on a 10 percent
commission of gross sales. How many hours of face time with customers can you
expect in any given year? How much will you have to generate in sales per hour to
make $50,000?
• The total work time in this example is 2,000 hours per year (50 weeks × 5 days × 8
hours).
2. As sales manager, you realize your salespeople need to be more efficient and effective
in managing their time and territory. As you deliver the opening comments at an all-
day seminar on time and territory management, your best salesperson stands and
asks why this is so important. How do you respond?
A salesperson’s ability to manage his or her time and territory well is important for three reasons:
• First, it increases productivity. Territories are designed to require maximum salesperson
3. You are vice president of sales for your company and are speaking with your sales
managers from around the country. You have been asked by the CEO to prepare a
five-minute presentation on why time and territory management is so important to the
company. What do you say?
Time and territory management is important to the company for four reasons:
• First, it ensures territory and customer coverage. By creating territories that define where
and how customers will interact with the company, the company will be sure that is has
4. Complete the priority checklist in Exhibit 10.2. What do your responses to the
checklist tell you about your career choices?
Salespeople must identify their goals for their two sets of priorities: personal and professional.
• Salespeople must make choices about personal priorities in life and career.
o Life priorities are basic choices in life, such as how important your family is to
you. Also, life priorities change as life changes and must be reevaluated.
• Salespeople must make choices about professional priorities.
o Account priorities relate to goals and objectives for individual customers.
Personal
Life
Family
How important is my
family?
Very important
Life goals
Do I live to work or
work to live?
I work to live, not
live to work.
Personal wealth
How important is
personal wealth?
Not important.
Only important for
my family to be
comfortable.
interests, but not
family time. I
would not take a
job if it meant
moving my
family.
Professional
Account
Sales volume
Is the customer buying
more now than last
year?
The customer is
buying about the
same as last year.
Satisfaction
Is the customer
satisfied with my
company/me?
The customer is
very satisfied with
my company and
me.
Sales/expense ratio
What is my ratio of
sales to expenses
compared to last year?
The ratio of sales
to expenses was
lower this year
than last year.
• The responses to the priority checklist indicate that quality of life and family are
important.
• Professionally the salesperson is doing moderately well but is not aggressively seeking
new business. In order to improve productivity while still making time for family and
5. You are sales manager for an office supple distributor in a large metropolitan area.
What do you use as your basic control unit in creating territories? Why?
Zip code areas should be used as the basic control units because the city and metropolitan
statistical areas (MSAs) would be too large. The advantage to using zip codes in this case is that
the areas will be relatively similar in age, income, education, and other socioeconomic data and
will even display similar consumption patterns.
6. What are the criteria used for estimating the total effort required by a salesperson to
cover a territory?
The manager determines total effort required to cover the territory by considering the:
• Number of accounts.
7. You are sales director for a company with 1,125 customers generating $30 million in
sales. Calculate the number of customers and sales generated using the 80:20 rule.
• 900 customers (80 percent of the 1,125 total) generate $6 million in sales (20 percent of
8. What is the most useful source of information on customers generated by any
company? Identify all the possible data available on that source.
The most useful source of information on customers generated by any company is usually the
sales invoice. The following data is usually available on the invoice:
• Customer name and location.
• Product(s) or service(s) sold.
• Location of customer facility where product is to be shipped and/or used.
• Customer’s industry, class of trade, and/or distribution channel.
• Terms of sale and applicable discount.
9. What are the primary ways data is aggregated in sales analysis?
• Salesperson territories divided by state, county, MSA, or zip code.
10. Identify five types of sales reports a consumer products company might generate.
Specify the purpose of such a report and who should have access.
Report Name
Purpose
Report Access
Region
To provide sales information in
units and dollars for each sales
office or center in the region as
well as a regional total
Appropriate regional manager
Sales office or center
To provide sales information in
units and dollars for each district
manager assigned to a sales office
Appropriate sales office or center
manager
Ethical Dilemma – Teaching Notes
Teaching Notes
In addition to the ethical questions posed by Frank’s involvement in the decision-making process
for the assignment of the new sales territory, there is the managerial aspect of territory design.
Have Frank and Larry done a good job designing and creating the new sales territory so that a
salesperson has a good chance of being successful if they perform well?
The primary ethical question in the case deals with Frank’s decision to involve himself in the
decision-making process for the new salesperson. As the dilemma notes, the local district
manager normally makes this selection but Frank believes Jim Henderson should be chosen. It is
creating new territories. For example, carving out a new territory could have a negative effect on
existing salespeople (why shouldn’t they get the benefits of new customers and sales potential).
In addition, the dilemma is helpful in facilitating a discussion on the territory design process and
how that process can create new problems if not done properly (poorly designed territories could
Answers to Questions
1. What would you do with a salesperson who had been a high performer in the past but
was currently not performing well?
More than an ethical issue, this question deals with the management’s ability to determine why a
particular salesperson performs well (or poorly) and what can be done to motivate them in the
2. Should Frank Lay give the new territory to Jim Henderson?
While there may be good reasons to give the new territory to Jim Henderson based on his prior
performance and the opportunity to motivate him in the future, Frank should resist putting
3. If you were Larry Van Dyke, what would be your reaction to Frank Lay’s decision to put
Jim Henderson in the new territory?
This is very much a personal question; however, many students will indicate that they would be
upset and frustrated to have senior management “go over their heads” and make this decision. As
noted earlier, Frank would be violating company policy in assigning Henderson to the territory
Mini-Case 10 – Diagnostic Services Inc.
This case does an excellent job of illustrating the importance of sales managers to the success of
a sales force. Diagnostic Services Inc. (DSI) is floundering after one year of operation, and
members of the sales force have little to no direction about whom they should be calling on, what
kind of information they should include in a call report, to whom they should send the call
report, and how many doctors they should call on every day. Clearly, the individual motivation
Answers to Questions
1. The answer to this question comes from the “Reasons for Sales Managers” section of the
chapter. Clearly the sales representatives have not been covering their territory and doctors very
well. Cindy didn’t even know the type of doctors she should be calling on, and she stated that she
sometimes runs into the other DSI rep in the city at the same doctor. The assignment of sales
territories and the specification of the types of doctors to call on should take care of this problem.
2. The process Lydell should follow to design territories is the same as that included in the
chapter. First, Lydell should decide on an appropriate basic control unit. In this case, a basic
control unit could be zip codes within each city or even specific city blocks, such as the blocks
around a major hospital in each city where doctors’ offices tend to cluster. Population statistics,
assess how much work is needed to cover each territory. Lydell will need to assess account
potential and competitive strength of each account when deciding how much work to put into
each account. Step four is to define sales territories. Here Lydell will define the boundaries of
each sales territory by combining basic control units based on potential and workload to form
territories large enough for one salesperson. Lydell should take care that a balance of workload
3. The types of information Lydell needs to conduct a sales analysis of each territory are
shown in Exhibit 10.8. Specifically, Lydell would be interested in the salesperson’s call reports,
his/her expense accounts, individual customer and prospect records, and financial records. The
