Issue: September 2006

Editorial in the Field

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I have experienced every incentive plan devised by manufacturers to get their reps to sell more. I have seldom seen these plans produce desired results.

Agencies are businesses that provide sales and marketing services; they are not simply salespeople paid on a commission basis. As businesses, they operate from a profit motive.

Reps know that selling is like planting a vegetable garden; they know that some of the vegetables will come up, but when and how many depends upon conditions over which they have no control.

At the same time, reps have to deal with their cash flow. How do … Read the rest

Coming to Agreement on Split Commissions

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“Tinkers to Evers to Chance” were the words Chicago Cubs fans once chanted to dig their team out of a hole in a baseball game. When it comes to manufacturers’ representatives facing the specter of dealing with split commissions, perhaps a similar chant might be “Vigilance, due diligence and a good contract.” At least that’s what two reps who regularly deal with split commissions recommend.

As most reps know, here’s how the typical split commission scenario develops:

  • The front-end work on an order is completed in Location A.
  • A purchase order is cut in Location B.
  • Final destination for the
… Read the rest

Tips & Tactics

Identifying sales barriers….

Manufacturers’ representatives can achieve double-digit growth with low risk and no additional sales/marketing costs if they identify and overcome what the Industrial Performance Group, Northfield, Illinois, calls the five common barriers to peak sales performance.

According to that organization, “Every year companies engage in the time-consuming ritual of setting sales goals and profit expectations. When they miss these targets, many revert to the traditional approaches to improving sales performance, such as changing the compensation plan, investing in the latest technology or bringing in a motivational speaker. Others blame the economy, the competition or even their customers for … Read the rest

Recent Court Decisions

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A number of recent court decisions dealing with manufacturers’ representatives point out the dangers lurking in failure to understand a contract with your principals.

Post-Termination Commissions

Chase v. Matsu Manufacturing was decided by the 6th Circuit Court of Appeals in August 2005. J. Michael Chase was in the purchasing department of General Motors for 28 years. After retiring from GM, Chase became a sales representative in the automotive supply business. He became a sales rep for Matsu, a Canadian manufacturer that hoped to use Chase’s experience and relationships to sell product to GM. Despite Chase’s experience and excellent bargaining position, … Read the rest

Steps to Help You Gain Financial Independence

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Many of us start our careers believing we’ll retire as millionaires, but we do little to help make that belief a reality.

That’s why a dangerous fantasy is not in disbelieving in the pot of gold, but in believing that somehow it will just appear when we need it through no effort on our part. In fact, I believe we have two choices: We can work for that pot of gold through discipline and perseverance throughout our careers, or we can end up working part-time in our golden years just to survive.

From my own observation, I’ve seen many retirees … Read the rest

New Marketing Rules in the Digital Age

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We live in a new era. The way things were done before do not necessarily count today. This new era has different rules. If you’re using the old rules in a new era, you’ll make as much progress as a wagon train would against a newly minted starship equipped with warp drive!

In today’s environment, success requires a never-ending devotion to using the best tools and having the best attitude to serve the customer. Customer needs and expectations are different, so you have to embrace them before your competition does.

Here are rules that you need to have in your … Read the rest

Successfully Managing a Rep‑Principal Business Relationship

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About 15 years ago, a manufacturers’ representative and his top principal were arguing vehemently during lunch. They went at it for 15 minutes, each determined to keep their respective ground in the argument — neither giving an inch. What was amazing about this argument was that if either one of them had paused for 10 seconds to listen, they would have discovered that they were actually in agreement. Somewhat reminiscent of the line in Pulp Fiction: “Are you listening to me or just waiting [for your opportunity] to talk?”

The problem wasn’t just limited to their egos “waiting to talk.” … Read the rest

Industry Conventions Still Offer Value for Those Who Participate

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I recently had the pleasure of attending AIM/R’s 34th Annual Management Conference, which offered top-notch speakers and networking opportunities.

While industry groups are struggling to attract new members, generate interest and boost sagging attendance at their annual confabs, it was evident from this meeting that there is still great value offered for those who make the commitment to participate.

The Association of Independent Manufacturers Representatives (AIM/R) drew more than 200 attendees to the Hyatt Regency Hill Country Resort near San Antonio in early May. Conference chairman Frank Parks of Parks-Peyton, Lafayette, Louisiana, organized a blockbuster program. Over three days, speakers … Read the rest

First Steps to Effective Sales Planning

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Adapted from Take Your Performance Up a Notch, Chapter 3, by Dave Kahle

Most salespeople love to be active — out in their territories, seeing people, solving problems, putting deals together. This activity orientation is one of the necessary characteristics of a sales personality. A day sitting behind a desk is their idea of purgatory.

Unfortunately, this activity orientation is both a strength and weakness. Much of a salesperson’s ability to produce results finds its genesis in the energy generated by this activity orientation, but it can be a major obstacle.

Far too often, salespeople are guilty of going … Read the rest

There’s No Overdoing Communication

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If there is any one attribute in the manufacturer-rep relationship that is emphasized more than others in the pages of Agency Sales, it’s probably the importance of communication — whether from the manufacturer to the rep or the rep to the manufacturer. The importance of executing a truly seamless communication process can’t be understated. Recently an example of effective communication came our way in the form of a memo that Bo Anderson, president of Glens Falls, New York-based Danfoss Flomatic Corporation, sent to all of his manufacturers’ representatives and employees. With Anderson’s permission, we reprint that memo below:

“Dear … Read the rest

Finding Reps “South of the Border” Proving Doubly Difficult

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It’s no small task for manufacturers to locate manufacturers’ representatives in any territory they’re looking to impact. The difficulty of that task is multiplied, however, when considering how to meet that challenge in Mexico.

That’s one of the major points made by MANA associate member Vince Lencioni, LGA Consulting, Mexico City, Mexico. As a matter of fact, the very existence of that challenge is one of the major reasons Lencioni and his company have joined MANA.

According to Lencioni, who also is an attorney, “There is no MANA in Mexico, and I think there needs to be one. We don’t … Read the rest

Rep and Manufacturer Working Off the Same Page

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If there were ever a principal and a manufacturers’ representative that are reading and working off the same page, it would appear that Genesee Stamping and Fabricating, Inc., and Premier Components, Inc., are the two.

Here’s how George Naseef, sales manager for Genesee Stamping, Grand Prairie, Texas, introduced us to the two companies and their relationship: “We’ve been using manufacturers’ reps since our inception, dating back to 1978. I wish to recommend Premier Components as the perfect rep agency.

“This group was founded by Lane Burnett in 1982, and we’ve been working with them since that time. Aside from the … Read the rest

Facts and Figures:
What You Should Know About Life Insurance

Acquiring life insurance has become an increasingly more important step to take towards financial security. And although some still may have no coverage at all, those that do likely don’t have enough life insurance. Here are some important facts:

  1. Households are so underinsured that life insurance makes little material impact on the household’s finances. These underinsured households are not much better off than those without life insurance.1
  2. In the past, it was customary to think that two-times your annual salary served as adequate protection. Unfortunately, those days are long gone. The new recommended coverage level is ten times your
… Read the rest