Most writers will attest to the fact that at the beginning of their careers the best advice they ever received was, “Write what you know.” While Dennis Badour and his wife, Barbara, chose a different career path than writing when they retired from their manufacturing sales careers, they decided to do what they knew — sell. That’s how and why their rep firm, LDMF, LLC, was formed in Moran, Michigan six years ago.
According to Badour, “We had our retirement and medical covered when we decided we wanted to continue working — preferably in our own business. While I’d like to say that opening our own agency was the culmination of a plan, actually it just sort of evolved. We looked around while considering what we might want to do and decided that sales was what we knew best. So that’s the course we followed.”
The rep route was decided upon, he explained because “we both had strong sales backgrounds in serving the automobile and after-market industry. But the bottom line was that we truly missed all aspects of selling for a living. We missed the people-to-people experience, working with customers, and we wanted to have our own company without being dependent upon anyone else.”
Trying Something New
Wanting something and making it happen are two different things, however, and Badour is the first to admit that starting a rep firm was something completely foreign to him. “Stressing how things just sort of evolved for us, while attending a trade show that featured safety and ergonomic products, one of the companies that was a former competitor to us asked if we’d be interested in taking a consulting position with them. They already had some established business but were looking to develop new opportunities. It looked like the ideal starting point for us.”
With that as a beginning, Badour and his wife quickly found that there were other companies seeking reps to pioneer new business. Here’s the approach LDMF found effective in dealing with potential principals: “We met with companies with no sales force and very little, if any, business. In our pioneering effort, we’d work with them to establish a sales force, manage their other reps, build up the business and then pass it back to them — if they determined selling direct was the best approach. On the other hand, if the manufacturer sells through distribution, then we assist them in establishing and training the members of the distribution network. At the same time, we’d look to establish long-term relationships with those principals.”
When it came to compensation for this primarily “pioneering work,” “We’d work with a modest retainer (to cover expenses) and commission while we opened doors and developed new business,” he explained.
That approach has worked thus far. “We’ve been able to renew our contracts with our principals, and we continue to grow the business for all of our principals. We’ve really taken some stagnant territories and turned them around so that they are now productive. We feel good that we’ve done a good job, and we’ve grown the agency at the right rate. We don’t think we’re ‘maxed out’ yet.”
Plan for Future Growth
To ensure that LDMF doesn’t ‘max out,’ Badour explains that one way they will continue to grow the agency is to specialize and hire retirees to work in some of those specialized areas. “What we’ve done and will continue to do is to hire recent retirees — former salespeople — who are friends. This type of arrangement meets both our and their needs. We’re looking to grow, and many retirees find that they want to continue to work, not to mention the extra income doesn’t hurt.”
When asked what philosophy best describes what he and Barbara are trying to follow with LDMF, Badour doesn’t hesitate when he says, “We’re unique, and our goal is to communicate that to our principals and customers. We’re looking to establish a win-win-win relationship between us and those we work with. If we establish a relationship with a principal, there’s got to be something in it for them and for us. Likewise, with our customers — we’ve all got to benefit. And finally in the end, if it’s not a win for all, then it’s not a ‘go.’”
Badour emphasizes that while the agency is in the growth mode, the fit for any partnership has to meet those “win-win-win” criteria. “We really are very particular and careful in who and what we pick up. We’ve been contacted by some companies in the past and turned them down. We decided it wasn’t a good fit or our return on investment wouldn’t be sufficient to justify our effort. It was a case of realizing that we’re investing our time, money and resources, and the return on that investment wasn’t going to be enough.”
According to Badour, an integral part of the success that he and his wife have experienced has been due to the couple’s early membership in MANA. “Joining the association was one of the smartest things we did,” he says. “One of the biggest mistakes we made early on was to let ourselves seem more likely to fall into the trap of having our principals treat us more like employees than independent manufacturers’ representatives. We were at the point where we knew we had better find a new direction. If we didn’t change, we’d be out of business in a hurry. When looking around to determine who could help us through this situation, MANA stood out like a sore thumb. In talking to MANA staff, we learned about the standard rep contract, found an attorney familiar with rep law, and learned how to best find new principals. In addition, we look forward to receiving Agency Sales every month.”