Issue: December 2012

Reps Are the Sherpas of International Commerce

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This issue of Agency Sales magazine looks at the role of reps in international commerce. And when we consider the fundamentals of the rep business model, we see that international commerce is a marketplace tailor-made for reps.

Just think for a minute about some of the major benefits reps bring to their principals: Local relationships, and knowledge about the local market and its business practices. For example, a principal in Chicago could never duplicate the relationships and knowledge a local Detroit-based rep has about his or her local market, even though the two cities are separated by only 300 miles, a five-hour drive, and a single time zone.

But that Chicago-based principal might try to service Detroit on a direct basis. And even though a Detroit-based rep could have penetrated the Detroit market more deeply and achieved greater success than the Chicago-based principal could do on a direct basis, that principal might scrape by and acquire enough business in Detroit to think he or she didn’t need a rep there.

Now consider a principal in Germany who is separated from the Detroit market by 4,000 miles, seven time zones, an ocean, language, culture, and business practices. Or a principal in China who is separated from the Detroit market by 7,000 miles, 12 time zones, an even larger ocean, and even greater barriers in language, culture, and business practices.

So while a domestic principal may think that he or she is “close enough” to the customer to serve them without a local presence, international principals are less likely to labor under the misapprehension that they can serve far-distant customers unassisted.

Reps are uniquely positioned to provide the local presence, relationships, and market knowledge international principals need, and the farther the principal is located from the customer, the more likely the principal is to quickly recognize that the local rep is crucial to his or her success.

And while representing far-distant principals can create new challenges and risks reps don’t face when representing domestic principals, one benefit of representing international principals remains clear. International principals desperately need local reps to do what reps do best — provide local presence, share their knowledge of the subtleties of local commercial practices, and leverage local relationships to create mutually profitable partnerships.

Keys to Effective Communication With Overseas Principals

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When a North American rep takes on a foreign principal, not only does it require every one of the same skills one currently uses with a domestic principal but also demands that a whole host of additional skills be added to the rep toolbox.

We all know that communication, trust and laying the ground rules at the beginning before any agreement is signed, are some of the major factors in helping to foster a long and profitable relationship. This is even more important when dealing with overseas principals. First of all due to time differences, a great deal of communication … Read the rest

Complete Homework Before Testing International Waters

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Manufacturing companies that have been largely dependent upon marketing and selling their products primarily in their home markets simply can’t survive any more with such a business plan. At the same time, independent manufacturers’ reps are finding myriad opportunities partnering up with offshore manufacturers to sell in the U.S. market and testing the sales waters in foreign countries. That’s why casting a net over international waters is such a strategic move for both manufacturers and the reps with whom they go to market.

That’s the view of many industry experts including Allan Lamberti, CSP, chairman and CEO of the Billiken … Read the rest

Dealing With New Sales Management in the International Arena

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Before, it had always been in the abstract for me when I learned via verbal or written reports from other reps when they described their challenges in dealing with a principal’s new management team. In my more than two decades of repping U.S. companies in foreign countries, I had never experienced an extensive purge of management of my principal’s staff — until now. Adding to the challenge I now faced was the fact that my agency was considered part of the old regime and thus under suspicion of harboring ideas of the recently departed management. As this management turnover started … Read the rest

Micromanaging vs. Coaching

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One of the greatest misunderstandings in leadership and coaching is the term “micromanaging.”

Most leaders never want to be thought of as a micro manager. In fact, it could be considered an insult or weakness of any manager. When micromanaging is used as a coaching or leadership style it will most likely deliver bad results, stifle creativity, limit employees’ self‑worth and — without a doubt — limit productivity. On the other hand, when a coach or leader must deal with a bad performer it is imperative to help the employee either become a better performer or help them find a … Read the rest

Keeping Customers for Life

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These days I hear many excuses for reps losing customers. The most prevalent by far is price. “The other company had a better price. There was nothing I could do.”

While price is always a factor, very rarely is it the main consideration when considering a switch, the best estimates put the percentage at about seven percent. The reality is, many reps simply aren’t building strong relationships and they use price and other excuses when the customer naturally goes elsewhere. If you build a strong relationship and keep customers happy, they won’t jump ship the first chance they get. Also, … Read the rest

Executing on Change: Don’t Leave the People Behind

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Operating in today’s business world is like living in the land of “Re” — something is always changing and mostly it is “re-something”: re-organizing, re-structuring, re-shaping, re-framing, re-aligning, re-engineering, and the latest term — “re-integration.” People have to constantly deal with the message “we’re changing again.” As such, change has become a constant part of our work lives and a normal function of every leader’s role.

Yet many change initiatives simply don’t work, leaving change agents scratching their heads. Often it’s because insufficient consideration is given to the people side of the change. It’s not that people don’t like change … Read the rest

Field Visit — Landmine or Opportunity?

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The principal is coming!
The principal is coming!

What does this mean to your agency? There is a lot involved in a “Field Visit” from a principal.

Who is coming?
Is it the sales manager?
Regional manager?
VP of sales? President?

It really doesn’t matter who the visitor is. What matters is your procedures and process for handling a visit from a principal.

Why is this so important?
The most important reason is that getting a principal on your turf is a huge opportunity to impress or disappoint.

Advance Notice

If your systems are good, you have an ongoing relationship … Read the rest

Business Ideas to Challenge Our Thinking

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The company president was excited about a popular cartoon depicting warriors fighting a battle with bows and arrows, along with a suited salesman carrying a machine gun and a briefcase. “Can’t you see I have no time to see a salesman,” says a beleaguered officer, “I’ve got a battle to fight.” Ironically, this is the same executive who nixed new opportunities for his company to grow its sales.

Ideas challenging the status quo can face roadblocks in just about any company whether in sales, marketing or, most importantly, the future. Yet, it may be that those are ideas that can … Read the rest

Business Writing Mistakes You’re Probably Making

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Most businesspeople have great ideas, but when it comes to putting those ideas on paper, they ramble on for pages and end up looking less than professional. But in today’s communication age, with e-mail trumping the phone and deals being done via text and social media, writing skills are of paramount importance. In fact, when your writing gets to the point quickly and effectively, you can enhance your credibility, position yourself as a leader, and ultimately increase your bottom line.

Following are the top business writing mistakes that plague most business writing. Overcome them today to boost your professional presence.… Read the rest

Reps React to Commission Cuts on Large Sales

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When a manufacturer asked for some guidance from MANA on his policy of reducing commissions as sales increased, he certainly got an earful from several MANA members. That input, which appeared in MANA’s LinkedIn discussion group, could prove valuable to other manufacturers as they encounter push-back from their reps in similar situations.

Here’s how the situation was described — The principal asked what the usual commission policy is for a situation like this: Their policy calls for a 1 percent decrease in commissions for every $500,000 in sales.

The first rep to take on the subject matter predictably began with, … Read the rest

How to Be Human Online and Connect With Customers in the Process

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Today’s wired world requires many businesses and organizations to have an online presence. That’s a great thing for consumers like me — I personally love to read about new products or news about a company if it’s an organization I’m interested in.

However, when an organization starts experimenting with social media, they often use these emerging tools with a glance to the past — like it’s still 1999. Their organization’s blog posts and status updates are written like stale press releases and brochures, and the photos look like they were purchased from stock photo sites.

What’s the problem? Dry, tidy, … Read the rest

Back to Basics: Why Contracts Can Be a Rep Agency’s Most Valuable Asset

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Successful sales reps talk about adding value. Reps provide service and expertise that help their customers operate more efficiently, and reps identify new customers and sales opportunities that help their principals grow. But reps are often so focused on getting the sale and running the day-to-day operations of their businesses that they don’t have the time to stop and think about how to add value to their own businesses — how to create a business that is as successful and saleable as possible.

Rep agencies don’t carry inventory and have limited tangible assets. So what are the assets of your … Read the rest

Health Care Law Tax Increases

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The Supreme Court has now ruled that the increases in the Health Care Law are tax increases. As we approach 2013, and the beginning of the Health Care Law, we need to face the effects of the eye-opening changes in taxes generated by this law.

Let’s consider what some of those effects are:

•   In 2013, employers must start reporting the cost of each employee’s medical insurance on their W-2. Companies must gear up their record keeping.

•   In 2013, a new tax of 0.9% on earnings in excess of limits. The limits for all of the income tax … Read the rest