When to Redesign

Originally Published MX November/December 2001

ADVERTISING, DISTRIBUTION, & SALES

There are several indications that a company’s territory alignment or its incentive plan may be working against it. Any of the following conditions should suggest to medtech executives that it’s time to revisit the alignment of their sales territories.

Vastly different market shares from one territory to the next, particularly if the high-market-share territories have low overall sales volume. High-potential territories typically have lower market share than low-potential territories. If high-market-share territories also have low sales, it is an indication that potential in the company’s sales territories is not balanced.

Vacant territories top sales-performance charts. This may be due to the fact that the vacant territories have huge potential and loyal customers. If the previous sales rep for that territory was earning large commissions because of the large sales base, that rep was probably overpaid, and the territory is probably too big.