Final answer:
When designing sales territories, factors such as measurable sales potential, efficient territory shapes, and customer coverage are essential. Marketing geography and site location analysis leverage sophisticated geographic tools like GIS to aid in making informed decisions about where to allocate resources and establish operations.
Step-by-step explanation:
In designing sales territories, a sales manager must consider several major factors for efficient and effective market coverage. Beyond ensuring measurable sales potential and optimal territory shapes, the territories must be constructed to promote customer coverage and efficient sales operations.
Using principles of marketing geography, analysts can identify where to allocate marketing resources by understanding customer income, lifestyles, and shopping behaviors. This field overlaps with business informatics and advertising, applying geographic tools and analysis in determining optimal locations for stores, marketing efforts, and other sales activities.
Site location analysis is critical, factoring in demographics, real estate costs, zoning laws, competition, and more. Geographers and spatial analysts utilize Geographic Information Systems (GIS) to forecast the success of potential sites, which is paramount for retailers and government facilities alike. This approach ensures a strategic selection of locations to minimize risks associated with business expansions or new ventures.
Understanding the distribution of primary activities and workforce complements the geographic strategy for creating productive sales territories. As described by Johann von Thünen's model, the proximity to markets impacts land use and can similarly influence sales territory design. Proximity affects transportation costs and potential market reach, indicating the importance of location in strategic planning.