Page 106 - DMGT507_SALES AND PROMOTIONS MANAGEMENT

Sales and Promotions Management

Notes 4. The number of present and potential customers in each volume/value group is then
multiplied by the desired call frequency to get the total number of planned calls required
for each geographical control unit.

Caselet TNT turns to Territory Management

aking the cue from the success of its new marketing strategy to increase its customer
base in the UK, B2B express Distribution Company TNT India has embarked upon
Treplicating the concept of ‘Territory Management’, which focuses on converting
prospective customers through regular contact programmes and propagating its salient
service quality and features. The customer base burgeoned by 194 per cent in one year
during 2000-2001 from its base customer level of about 14,000.
Mr Sanjiv Kathuria, Head (Sales and Marketing), told that about 70 per cent of the customers
using the express courier service have the potential to become regular customers.
However, the tendency to concentrate on the 30 per cent customer base yielding 70 per
cent revenue has made the service providers complacent.
But, he added, with the competition intensifying, companies were facing pricing pressure
due to increasing costs, particularly with TNT’s network concentrated in Europe.

Maximising the use of resources, time and infrastructure to strengthen customer base
would prove to be an effective marketing strategy to expand revenues and bottom line.
The territory management concept, launched in Bangalore after its successful venture in
Mumbai and Kolkata, has helped in evolving a uniform sales process and system through
technology to bring prospective customers into TNT fold.
Source: thehindubusinessline.com

5.2.3 Revising Sales Territories

In different situations redesigning and relocation may have implication for profit contribution.

Situation I

Where sales potential of territories are equal but the salesman differ in their abilities.

Territory Sales Salesman’s Ability Expected Sales Expected Profit
Potential name Index (say 25%)
1 20,000 x 1.0 20000 5000
2 20,000 y 0.6 12000 3000
3 20,000 z 0.4 8000 2000
Total 60,000 40000 10000

Situation II

Where management designs sales territories in such a way that sales potential of territories
varies directly with the ability of the sales person.

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