In the article that appears on page 24 in this issue of Agency Sales, Jerry Leth, MANA’s director of membership, and Joe Miller, former president/CEO of the association, detail steps manufacturers should take in order to establish and firm up the relationship between principals and their reps.

What frequently happens in the principal-rep relationship is that things can start off well but then sour in a hurry. Part of the cause of this disintegration of the relationship is that once reps are signed on, they are all too often forgotten. A bad situation can be exacerbated when principals fail to offer reps any orientation, visiting to the home plant is not encouraged, there’s no strategic plan and no real commitment to the rep way of going to market. It would appear that as long as the orders keep on coming, nothing has to be done to maintain/improve the situation.

When problems such as leads not being followed up or quotes come in for the wrong product, however, both the principal and the rep get unhappy in a hurry. Both are disappointed. The principal is upset and begins to think reps aren’t the correct way to attack the market, and reps are upset because their original satisfaction at landing a good line has quickly turned to disappointment.

Agency Salse magazine has reported on this cycle over the years, but it’s a cycle that doesn’t have to continue. A number of steps to change course were outlined by Leth and Miller and in their article, but there’s more that can be done. For instance:

• It’s incumbent upon the principal to learn all they can about their reps. What’s their level of experience in your market, with the customers you want to attract? Are they the type of person you want associated with your company?

• Once reps are signed on, stay in close touch after the initial courtship period.

• Ensure that your company’s philosophy and story are clearly communicated and defined for your reps. Let them know exactly what your company is good at and educate them as to the type of customer you’re after.

• At the same time you insist that reps visit your factory, make sure to visit with them and travel with them in the field.

• Provide a steady stream of the tools they’re going to need to get the job done — and do it without them asking for it. By tools we mean everything from paperwork, copies of quotes, orders, invoices, sales literature, product samples, etc.

• Communicate, communicate and communicate some more. Establish a schedule whereby you’re in weekly and monthly contact with your reps. At the same time, encourage them to communicate with you on any and all matters of importance from the field.

• Encourage a teamwork philosophy among your inside people so reps know they have someone at the home office they can depend upon.

• Above all else, pay them accurately and on time.

Effectiveness of Rep Councils

Over the course of the next several months, articles will be appearing in the pages of Agency Sales that examine various aspects of change. For instance, in this issue, we reported on three rep firms that commented on the overall importance of agencies accepting and embracing change in order to provide them with the best chances for success in the future.

One of the topics we’ll be covering is that of manufacturers’ rep councils. This subject could very well fall under the heading of “the only constant is change.” By that we mean rep councils, if run correctly, have always been an effective means of communication for principals and their reps. But what brings this subject to the fore are a couple of comments we recently received from manufacturers. First, one manufacturer contacted us asking how prevalent rep councils were and what types of contributions, if any, did they make to the manufacturer-rep relationship. After providing him with information that had previously appeared in Agency Sales, he was advised that establishing a council was probably a good idea. But before he did anything, he was advised to appoint someone in his company as the “rep champion” — that is, the person the rep can always count on when he has a question, problem or concern. It would also fall to this person to be sure the rep council was properly run.

To his credit, this manufacturer seemed genuinely interested in putting a rep council together — and he promised to get back to us so we could report on this efforts.

Establishing Benchmarks

Before we let go of that manufacturer, he was referred to another non-competitive manufacturer who has been enjoying the benefits of a rep council for years. An integral part of the manufacturer’s efforts has been his success in establishing performance benchmarks, not only for himself but also for his reps. In other words, the principal and his reps would annually meet and agree upon joint goals. At the end of the year, they’d meet again and discuss how well each of them performed toward meeting those goals.

As an example, the subject of rep participation at trade shows was discussed. On the one hand, his reps had felt for years that there were real benefits to be realized by attending and participating in industry trade shows. On the other hand, the manufacturer made it a habit of dragging its feet when it came to attending these shows in the company of their reps. In order to get a clear view of the effectiveness of such shows, the principal and the members of the rep council agreed that the manufacturer would attend (in the company of their reps) a specified number of trade shows over the course of a year. At the end of the year, they’d meet and measure the success — or lack thereof — of these efforts.

To both of their satisfaction, this trial run at trade shows proved to be effective, and the manufacturer has upped his participation over the last couple of years. The manufacturer was quick to note that he would have never agreed to this course of action without the measured approach the council offered.

It All Comes Down to Communication

When a manufacturer recently voiced the complaint that his recent switch from direct to outsourced sales wasn’t resulting in the immediate success he had hoped for, it didn’t take long to learn he wasn’t telling the whole story.

The crux of this complaint was that the more than 10 reps he signed on to replace his factory direct sales force weren’t all delivering at the same pace. A little bit of probing unearthed the fact that there was a little information missing from his story. For instance, in three of his territories reps were met with unexpected frustration from several customers. It seems each of those territories had run through four sales managers in the past five years. As a result, instead of being able to make complete sales presentations from the get-go, each had to do a bit of public relations work and assure each of the customers that the turnover in sales personnel had stopped. They educated the customers as to the reps’ staying power in the territory and let them know that they weren’t leaving for better jobs or promotions in the manufacturer’s business. While this change in sales personnel was hardly a deal killer, what it did do was hamper the rep’s ability to hit the ground quickly.

Then there were some problems with product quality and delivery. In all fairness, the reps in this case should have probed the manufacturer a bit more deeply to learn these problems existed. But, on the other hand, the manufacturer should have been more forthcoming to let the reps know they’d be faced with these concerns, so they had better be prepared.

What it all comes down to is communication. The manufacturer, if they truly had a commitment to the rep way of going to market, should have put all their cards on the table, leveled with their reps and let them know there would be a bit of an uphill climb before they’d realize the sales success they were planning for.

Keeping the Customers You Already Have

A real endorsement for using reps came by way of a manufacturer that explained, “We’ve found reps are the best way we know of to keep the customers we already have.” He went on to note that he was a true believer in the philosophy that your existing customers are your best customers. “We know that when we lose a customer it’s difficult to get them back. In addition, it takes more effort to get and serve a new customer than it does to get your existing customers to maintain or even increase sales. That’s where we’ve found our reps to be so beneficial.” He went on to explain why:

• Reps are a presence in front of the customer — all the time: “Our reps have shown us that the best way to learn the customers’ needs is by regularly being in front of them and serving as the conduit between us and them.

• Value-add: “I know this is an over-used term, but it really exists in our reps. They’re the experts at appraising the customers’ business needs and serving as their problem solver.”

• Service providers: “No matter when and where the customer has a need, the rep has shown us that he’s there to meet that need.”

• Partnering: “Our reps have forged strong partnerships with their customers and communicated to them they that they are their partners and their ultimate goal is to meet their needs.”