Many of the manufacturing personnel who read Agency Sales are new to working with independent reps. Some of these managers will be involved in the process of selecting new representation for their company in one or more territories. But, many of these managers and some of their superiors do not have much experience selecting reps.

Relationships: There are many reasons to select a rep firm to carry your company’s products to market in a territory. Existing relationships with key distribution or end users is your first consideration.

Track Record: There is no question that a rep firm’s results with their other lines is vital. The reputation of the rep firm is very important.

Six-Point Check List

As a result of years of interviewing reps and working with firms that go to market with a rep sales force, the following check list has been created. Each of these items helps predict success. Combined, the six are very likely to tell an important tale. Use a 1-10 scale where 1=poor/ineffective, 5=average and 10=superior, great, most effective.

1. Profile — How does the rep firm present itself. Does it have a formal profile designed to sell their firm to prospective principals and customers?

A rep firm should have a really effective piece. At a minimum the profile should tell you about their territory, their people, their history. It would be very good if they include some letters of recommendation from current principals and customers. And, of course, they need to present their line card.

What lines to they have? How does the rep firm present itself as representatives for their package of lines? Why do they have these lines? How do they conduct business? What is the approach they take to their business? How do they support their sales effort? What sort of organization do they have?

All of this and more should come through loud and clear in their profile. This piece is their way of selling themselves to you. A weak or poor profile is a telling sign. Remember a PowerPoint presentation and a website are not the same as a profile.

2. Sales Force Management — When you retain a rep firm, you are making a commitment to a branch office. So how does the rep firm manage its own sales force? If you owned the office, how would you want the sales team managed? Are they well organized in their approach to their customers? Is there a clear plan for each of their principals? What do they do to remedy situations where they are not reaching sales goals? What do they do to communicate the management of their sales force back to you, the principal — the one who sends the commission check?

3. Communication to Principals — The development of an effective rep sales team is all about communications. When you are looking at a prospective rep firm one of your key questions has to be “How do you communicate with us?”

It often feels like the principal has no control of the sales process. One of the things that makes new sales management people working for manufacturers who use reps uncomfortable is this perceived lack of control.

This “myth of control” is one of the biggest reasons for conflict between manufacturing management and reps. One of the best ways to avoid a control issue is for the rep firm to have a highly effective communication system. The burden for communication falls on the rep’s shoulders. The principal is paying the bills. He is entitled to good communications from the rep. The principal is the rep’s customer. How does the rep keep the principal informed? This must be a clearly defined process which the rep can demonstrate and illustrate during the interview process.

4. Forecasting — Revenue forecasts are a critical part of the manufacturing management process. The most effective revenue forecasts come from the field. No one is closer to the customer than the rep. When interviewing reps it is vital that the rep explain their forecasting process.

The principal cannot expect perfection. The forecasting process is more about being close to the business processes of the customer than it is about being informed and having reasonable estimates of the business activity for that customer. How detailed should the forecast be? As detailed as possible is the best answer. If one product is a major revenue producer, then the rep should be able to get reasonable estimates of usage from the customer.

Detailed Annual Plan — In addition to the forecast annually and quarterly, the principal is entitled to an annual plan for the rep’s business in the territory. A major principal should look for a meeting with the rep firm in person to review the past year and plan for the next year. This meeting should take place no later than mid-January of a new year. What does the rep firm do for its principals? How does the rep firm approach the annual plan and planning meeting? These are important factors in selecting the next Rep for your company.

5. Customer and End-User Communications — The rep firm is your company in the territory. How does the rep firm represent your company to its customers and those customers’ customers (if you are in the business of selling resellers)?

What tools and programs does the rep firm provide? Does the rep firm put out newsletters, promotional flyers, participate in local shows, conduct product demonstrations, etc.? How does the rep firm take your products into the market?

These are critical questions which make a big difference to the success of your products in the territory.

6. Training — How does the rep firm invest in its organization and its people? You are dependent on the skill of the individuals who work for the rep firm. You need to know how the rep principal(s) goes about making their people more effective for you.

Summary

These six points are provided for you to create your own set of questions and your own standards of measurement when interviewing reps to handle your business in an individual territory. Using these check points for making your decision to hire a rep firm is the first step to making the relationship successful.

The next step is holding the reps to their commitments made during the interviewing process. You will have a contract that describes the legal relationship between the rep firm and you, the manufacturer/principal. But, you need to have clearly expressed standards of measurement as the basis of your working relationship.