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A designated area in which a salesperson works. For example, a sales territory may include a neighborhood, a town or even a whole state. Sales territories are assigned to reduce competition between commission-based salespersons working for the same company. Most of the time, only one (or a few) salespersons are placed in a territory.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved
sales territorya geographical area containing potential customers who can be approached through DIRECT SELLING and to which salespersons can be assigned. The number and sizes of territories scheduled by a firm will depend upon such considerations as numbers and size of potential customers to be covered, how densely they are grouped (since this affects travelling time between customers) and the complexity of the selling operation (which will determine the number and length of sales calls required). Where a sales territory contains insufficient potential customers to warrant the cost of deploying its own sales personnel (see SALES REPRESENTATIVE) a firm may instead choose to sell its products through a SALES AGENCY.
Collins Dictionary of Business, 3rd ed. © 2002, 2005 C Pass, B Lowes, A Pendleton, L Chadwick, D O’Reilly and M Afferson