Sales Territory Planning Best Practices: 3 Experts Weigh In

The subject of sales territories and sales territory management is a common one in most every revenue team. In many ways, it’s the nature of the beast. It’s for good reason. Simply, sales territory planning and territory management are foundational pillars of every successful Sales team.

The reason Sales teams discuss territories is that they are never a “set and forget” criteria. As your organization scales, territories change. As you learn more about your total addressable market, territories change. When you expand internationally, territories change. You get my point. 

Sometimes, marketplace forces drive changes to how territories are structured and managed. Other times, it’s the Sales team itself – sometimes developing new territory structures, other times exercising territory management to reflect changes in the team like promotions, new hires, etc. 

With regards to the latter topic, territory management, LeanData recently published a post entitled “Managing Leads, Accounts & Opportunities with Territory Management” that gets into the operational nuts and bolts of the topic. Definitely check that out if you find it a challenge to operationalize your territory changes.

On the former subject, strategically creating sales territories, LeanData recently published the infographic, “8 Steps to Create & Execute a Winning Sales Territory Plan.” This post dives into the topic in more detail, and I’m bringing in some serious sales experts to help navigate the journey.

Abstract, artistic map of the world.

Territory Management Best Practices

Define your ICP

Once you have your revenue goals and objectives firmly established, it’s important to examine your ideal customer profile, or ICP. Your ICP defines your perfect customers. However, too often, Sales teams look at their existing best customers and project that forward. Sometimes that’s a good thing, sometimes it’s not.

Carefully examine your business as it stands today. How have your products, solutions and services evolved, or changed? How have your goals and objectives changed? Ensure your ICP truly reflects who your best customers should be going forward to accomplish your growth plan.

“Start with building a scoring matrix of six to 10 attributes that make up your ICP, remembering that not all attributes are created equal. By factoring each attribute — some might be worth 1.5x or 2x, for example — you’ll start to create a list of potential customers in priority order based on their ICP score.

Also, use customer wins and losses to help inform your ICP; likewise, use your expanded and churned customers as well. Ultimately, churned customers more than likely did not recognize enough value from your solution, and thus probably don’t fit your ICP. On the other hand, recent customer wins, along with customers renewing and expanding, more than likely hit the center of your ICP.”

~ Bill Lawler, EVP Sales Global Enterprise & EMEA, Sales Impact Academy

Determine your TAM

The total addressable market, also called the total available market or TAM, references the totality of the revenue opportunity available for your organization’s product, solution and/or service.

Your data makes a difference here. By defining your current market, your Sales team will understand where — and how — our business can grow. In turn, it provides them the means to prioritize and focus on the right customers, at the right time. 

“Defining your TAM and ICP are great places to start when it comes to building sales territories. Understanding your “in-market” ICP (IICP), which is dynamic and changes daily, is critical to building scalable processes and ensuring Account Executives spend time on accounts most likely to convert to qualified opportunities today. Data shows AEs spend 40 percent of their time trying to determine the accounts and contacts on which to focus. That’s nearly 100 days every year of wasted effort. We’ve found that focusing on your IICP allows AEs and BDRs/SDRs to build sales pipeline efficiently, maximizing time and leading to increased productivity.”

~ Kyle Hollingsworth, Vice President Sales, West at 6sense

Conduct a SWOT analysis

Strive to understand your organization’s strengths, weaknesses, opportunities and threats in the marketplace. Focus on your key success factors by analyzing “the 3 Cs,” company, customers and competitors. 

“From a historical perspective, sales organizations have relied on their salespeople to develop “sales intuition” by mentally cataloging where they win and lose. Today’s sales organization is built upon ‘sales information’ where historical data about winning and losing is derived from across the entire technology stack. For example, Salesforce provides quantitative sales process information such as sales cycle length, number of meetings, and the decision makers involved at different stages. Gong provides the verbal analysis of prospective customer interactions. LeanData provides lead scoring history and buyer intent metrics. Collectively, all of these information sources provide an accurate assessment of why you truly win and lose.”

~ Steve W. Martin, author and sales researcher from the University of Southern California

Define sales territories and responsibilities

Only after you accomplish the key tasks above are you ready to formalize sales territories. Begin first by mapping where your current customers and prospects are located and the revenue, or potential revenue, from each. You’re trying to create equitable territories.

Another key component in developing and assigning sales territories is a detailed examination of the time requirement for both your representatives and, importantly, the territories’ prospects and customers. New markets, for example, may need more time and effort devoted to the top-of-funnel stages in the buying journey.

And, of course, don’t forget to regularly and continuously assess the strengths and opportunities for improvement of your Sales team. 

“Research I’ve conducted indicates members of high-performing sales organizations have a different perspective on the factors that separate great from good sales organizations than members of average and underperforming sales organizations. In general, high-performing sales team members placed action-oriented factors at the top of their list, including lead generation and pipeline activity, and disciplined sales processes and systems usage. Underperforming sales team participants placed more personal, skills-based factors at the top of their list, including sales team morale and collaboration, talent of salespeople, and quality of sales leadership. One interpretation of these results suggests that high-performing sales teams think in terms of strategic sales process management, while underperforming sales teams focus more on personal sales prowess.” 

~ Steve W. Martin, author and sales researcher from the University of Southern California

Finally, as a Sales leader, you need to create and assign your territories with an eye toward two considerations: 1) Equity, both in terms of quantity and quality of accounts, and 2) Balanced workloads. 

“Salespeople and sales leaders have vastly different perceptions about the equity of sales territories within their organizations. In my casual conversations with salespeople, nearly 75% felt like sales territories were somewhat unfair in terms of their revenue potential. Conversely, over 80% of sales leaders I spoke to believe the sales territories were predominantly fair and split equitably.

~ Steve W. Martin, author and sales researcher from the University of Southern California

Develop metrics and a reporting dashboard

C’mon, I don’t need to convince you of the value of metrics in your role as a Sales leader, do I? Performance metrics empower you to analyze the success of your initiatives and identify areas that need continuous improvement. Create a solid set of relevant, reflective metrics, and invest in the development of an easy-to-understand dashboard. Any manual time spent shifting through data is less time available for leading, coaching and managing. 

For territory management, use Sales team performance data to determine needed improvements in the prioritization of targeted accounts and prospects. Additionally, use metrics to inform territory management considerations like territory design, balance, and even factors like efficiency in travel.


Establishing sales territories are critical to drive growth and scale at your company. Sales territories provide the framework for organizing, planning, managing and controlling the revenue team’s sales operations. Well-designed territories increase market coverage and deliver better services and experiences to customers. The results are increased sales volumes and market share. 

As your marketplace evolves, ensure your sales territories keep up with the changes. Regularly examine your territories, and use the expert tips above to help guide your revenue team to quota-busting success!

  • sales
  • Sales Territories
  • Territory Management
About the Author
Rob Simmons

Rob Simmons has led software sales teams for 10 years, separating his team from the competition by investing in people, leveraging a best-in-class sales tech stack, and developing scalable sales processes. Connect with Rob onLinkedIn&Twitter.