Territory

With one salesperson there was nothing to divide. That person covered every customer, and the question of who owned which account never came up. Three reps is where it breaks. Each built their own list, whoever saw an inbound inquiry first grabbed it, and the record of who had contacted whom lived only in individual inboxes.

The damage becomes visible from outside first. A team lead at one company gets two separate introduction emails from your company in the same week. One pitches the free plan, the other pitches enterprise. What that person takes away isn't curiosity about the product but a read that the company is disorganized. Inside, an argument is waiting too: two reps spend weeks on the same account, and the moment it closes somebody has to decide whose commission it is.

Territory is the practice of drawing those boundaries in advance. Each rep gets a defined range and stays out of everyone else's. What matters is that the purpose is eliminating overlap rather than achieving fairness. With lines drawn, nobody contacts the same company twice, and who owns what becomes the basis for commission rules and target allocation.

Four criteria are commonly used for drawing the lines. A company picks one that fits, or layers two.

1. Geography — splitting the capital region from everywhere else. Useful when deals involve visiting customers in person; much less meaningful for a product sold over video calls.
2. Company size — splitting below and above 100 employees. Many companies use this because the selling motion is genuinely different: under 100 closes in two calls, above 100 brings security review and legal review with it.
3. Industry — splitting finance, manufacturing and the rest. Regulations and vocabulary differ enough per industry that a rep who keeps covering the same one moves faster from their second account onward.
4. Existing relationship — accounts someone has already been in contact with stay with that person. This is the rule for handling exceptions after splitting by something else.

Once the criterion is chosen, three more things get settled. First, balance: ranges are matched on the potential revenue inside them, not on the count of companies. 400 prospects in the capital region and 700 outside it can still mean the first range is larger in money. Second, the tiebreaker: with two or more criteria in play, the order of precedence has to be written down. Third, the redraw cadence, usually once at the start of the fiscal year.

Any redraw has to be paired with a change to the commission rules. Commission is the variable pay tied to results, typically a percentage of contract value. When ownership of an in-flight deal changes hands, who collects on it has to be written down beforehand, or the first week after a redraw goes to arguing about it. The usual settlement is that deals already past a named stage pay the original owner while everything earlier transfers, which is arbitrary but has the advantage of being decided in advance.

The first place it matters is dividing targets. Splitting a company goal of $600,000 across four reps as $150,000 each only works if each range actually contains $150,000 worth of prospects. Divide targets without drawing ranges first and the rep with the thin range cannot hit the number from day one — and that person leaves inside six months.

It also governs how inbound inquiries get routed. An inquiry arrives, its company size and industry get read, and it goes automatically to whoever owns that range. Without the rule, the structure becomes whoever-sees-it-first, which concentrates inquiries on the fastest clicker rather than the best fit.

Hiring and handoff hang on it too. Whether to add a rep depends on whether the current ranges are being covered. One person assigned 600 prospects who contacts 200 in a year leaves 400 that exist only as names on an assignment. Boundaries also apply at sales handoff, the process of passing a signed customer to the customer success organization — the receiving side has to be divided into ranges as well, or there's nobody specific to hand to.

"That account isn't in my territory. Anything above 100 employees is Sofia's."

Checking the boundary to prevent a duplicate approach.

"When we redraw territories next year, let's write down that in-flight deals pay commission to the original owner."

Heading off the argument a redraw creates by making it a rule first.

"My range only has 200 prospects in it and my target is the same as everyone else's."

Raising the mismatch between target allocation and range size.

Pagedeck splits at 100 employees. Below that, two SDRs open first contact — the role that reaches out to companies that have never heard of the product and books the meeting — and one rep takes it from there to close. Everything above 100 goes to Sofia. There's no industry split, because at under twenty deals a quarter, dividing by industry would leave each person with too small a share.

Grace revisits the boundary in the month the fiscal year starts, using two figures per range: how many deals closed there and what they averaged. Last year a proposal to move the threshold from 100 to 150 got examined and dropped: it would have halved the prospect count in Sofia's range while lengthening the average deal, which didn't pencil out. What did change was the document — the commission attribution rule for in-flight deals got written down.

The most common mistake is treating fairness as the goal. Equal shares feel like the way to avoid complaints, so the instinct is understandable. But equal size and equal opportunity aren't the same thing. Assign 500 prospects each and the rep whose 500 average $2,300 per contract has a tenth the chance of hitting target as the rep whose 500 average $23,000. Balancing on counts produces a table that looks fair, and the real complaint surfaces mid-quarter as attainment.

The other mistake is assuming the lines can be drawn once and left alone. Changing boundaries often does create confusion, so the caution has a basis. But the market and the product move. A product that targeted companies above 200 employees last year and starts selling better into fifty-person teams this year has boundaries that hand the productive segment to one person. Left alone, one rep hits double their target while another lands under half, and that gap gets recorded as a difference in ability. Which is why the close rate and average value per range get remeasured at least annually.