How to set up Root territory

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We have a requirement to implement the Territory management for Sales Office defaulting at the Order level based on the Customer Zip code. I understood that this can be achieved by implementing Territory management. 

I have tried to set up a Root Territory to start the set up in Demo instance but I was not able to create.  I have sales administrator role assigned , apart from this do I have to have any other set up?

Thanks,

Suresh