House Account

Definition

A house account refers to a client account that is handled at the main office or managed by an executive of the firm, as opposed to being managed by sales personnel within specific territories. This can happen for a variety of reasons including the strategic importance of the client, the complexity of the account, or the desire for more centralized control.

Examples

1. Corporate Clients: Large corporations that require special attention and customized service agreements are often managed as house accounts to ensure top-level service and consistency.
2. National Accounts: Accounts with a nationwide footprint, that span multiple sales territories, may be managed centrally to ensure cohesive service delivery and pricing.
3. Strategic Partnerships: Companies involved in strategic partnerships or alliances may have their accounts handled by an executive team to maintain strong relationships and foster growth.

Frequently Asked Questions (FAQs)

What differentiates a house account from a regular account?

A house account is centrally managed by the main office or a firm’s executive, while a regular account is typically handled by a salesperson within a specific territory.

Why would a company designate an account as a house account?

Companies designate house accounts to ensure top-level management for strategic clients, maintain consistency, and align closer with the main office’s objectives.

Can small businesses have house accounts?

Yes, small businesses can designate house accounts, particularly if they have high-value or strategic clients that require dedicated oversight by senior management.

How do house accounts affect sales representatives’ territories?

House accounts are typically excluded from the sales representatives’ territories, meaning they do not earn commissions from these accounts.

Is it beneficial for clients to be managed as house accounts?

Clients managed as house accounts generally receive more direct attention from senior management, better service, and more customized solutions.

Related Terms with Definitions

• Key Account: A significant client account that requires special attention due to its size or strategic importance.
• Territory Management: The process of managing and defining sales efforts within a geographical area.
• National Account Manager: A managerial role responsible for handling accounts that span multiple regions or territories.
• Client Relations: Strategies and activities focused on managing a company’s interactions with its clients to foster long-term relationships.

Online References

1. Investopedia - House Account Definition
2. Wikipedia - Account Management
3. Salesforce Blog - Managing Key Accounts

Suggested Books for Further Studies

1. “Account Management: A Guide for the Sales Professional” by Richard S. Johnson
2. “Customer Relationship Management: Concept, Strategy, and Tools” by V. Kumar and Werner Reinartz
3. “The Challenger Sale: Taking Control of the Customer Conversation” by Matthew Dixon and Brent Adamson

Fundamentals of House Account: Business Administration Basics Quiz

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