This issue of Agency Sales magazine is the second in an ongoing series that explores the subject of MANA serving as the association for professional manufacturers’ agents and high-quality principals that work with each other as partners in profits. In last month’s issue, the importance of independent manufacturers’ reps creating and sharing their business plans with their principals was detailed. This month, we discuss how reps and manufacturers define, locate and establish effective business partnerships with true “professionals.”

This first of two articles describes that subject from the manufacturer’s point of view and is followed by a similar article in which reps detail what they are looking for in a professional marketing partner.

Preaching what he practiced as an independent manufacturers’ rep, Mills Rendell, CEO of Zeus Battery Products, Bloomingdale, Illinois, looks to his previous career when he’s called upon to describe what it takes to be a “professional rep.”

According to Rendell, who began his sales career more than 40 years ago, there are any number of attributes a manufacturer should look for when seeking representation. “First off, when considering how to market and sell your products, reps are the best way to go economically. They’re an independent sales force, they pay their own expenses, they live in their territories and they have personal relationships with their customers.”

What the Manufacturer Looks For

As for what might distinguish a professional rep from all others, he continues that “From the manufacturer’s standpoint, here’s what we generally look for:

• “We’re not necessarily a giant line for a rep. As a result, we need a rep with substantial relationships in the territory; we need someone who can pull us through. That’s why it’s so important that any rep we work with have lines that are complementary to ours. They must have a familiarity not only with batteries, but with the products that go along with batteries.”
• “Naturally they’ve got to know the territory and have a record of establishing friendships and relationships in the territory.”
• “Longevity in the territory is another important asset. They’ve got to have been in business for a while.”
• “A rep has to show us that he has a genuine interest in our product and that he has the ability to sell our line.”

In terms of establishing a level of professionalism, Rendell says word-of-mouth recommendations and reputation speak a great deal about a rep firm. “We find that it’s not an ultra-sophisticated process to find the professional rep. In the electronics business, we work with a lot of distributors. They’re quick to let us know who the good reps are. In addition, we’re also aware of the top customers in the territory and we’ll ask them ‘Who do you know that does a good job for you?’ Finally, reps know each other from their trade associations, sales meetings and rep councils and they’re always willing to help each other get new lines. We’ll go back and forth among reps asking them who they might recommend in the Los Angeles or New York City territories. That approach works quite well for us.

“Once we locate someone who has been recommended to us, we have a litany of questions we’ll pose that will lead us to our ultimate decision.”

Getting Fair Share of Time

Once lined up with a rep, Rendell says that one of the constant challenges he faces in dealing with the professional rep is to get enough of his time in the field. “This is something I can relate to from my years as a rep,” he explains. “We meet that challenge by constantly staying in front of the rep. I certainly remember from my rep career that time is of the essence. The rep gets up and goes out every morning and goes to work not just selling your line but others as well. We’ve spent a lot of time, money and effort establishing our brand in the marketplace. To make sure that we get our time with our professional rep, we try our best to keep him supplied with product bulletins and information about our company. Our thought is that out of sight, out of mind. If we’re not in his sight, then he’s going to spend his time selling other lines.”

Two final areas that Rendell emphasizes are important when sizing up a rep as a professional are how he works with the principals during visits in the field and his ability to communicate with the home office.

“Have an action plan. That’s what I expect a professional rep to have when there’s a visit scheduled for the field. You want someone who will pick you up at the airport, schedule breakfast meetings and have a firm itinerary for the entire day. At the end of the day, don’t just drop me off at the hotel and say goodbye. Have a plan for dinner when we can talk things over. Then when I travel back to the home office, by the time I get off the plane, have an e-mail detailing some of the action plans we’ve agreed upon.”

“In order for the rep to understand the needs of the principal, he’s got to stay in touch. That’s why I tell them they ought to call in at least weekly. I don’t care if it’s just to discuss how the New York Giants are doing, we’ve got to have a relationship. If I haven’t spoken to a rep in four weeks, from a manufacturer’s point of view, I develop an opinion about that rep firm. I know they’re busy and I know that they’re selling more than just my line, but for us to be able to jumpstart our efforts together, they’ve got to stay in touch.”

Sticking With Reps

When asked his thoughts on partnering with truly “professional” independent manufacturers’ reps, Doug Biggs stresses that given his druthers “I will always opt to work with the real pros. That’s the way I prefer to conduct business.”

The vice president of sales and marketing for Gilman Precision, Grafton, Wisconsin, maintains that it’s really a fairly easy choice: “I appreciate the fact that reps know their territories, their customers and the rep is a variable vs. a fixed cost.”

While he remains a true believer in the rep way of going to market, there are some concerns today and some other problems on the horizon when it comes to locating and working with those true professionals.

Pipeline full of professionals — According to Biggs, the chronological age of existing reps, coupled with a lack of adequate succession planning, could combine to pose serious concerns for the future. “Unfortunately, within the industry that we serve, the youngest rep principal that we work with is in his mid 50s. Luckily for us, one of our rep firms has a son who is working in the business and another has just signed on someone who is doing a good job for him and the future looks bright with those agencies. But if you look further, your chances of finding rep principals in their 20s and 30s is more the exception than the rule. Then there’s the concern about what to do when a rep retires. In certain territories, you can’t always find a rep to do what you need done.

“So what remains is the challenge of attracting individuals to the rep profession. I recognize some of the barriers that people must overcome to pursue such a career. Just to open your doors you’ve got to have sufficient funds tucked away for at least six months of living and business expenses. Compounding financial concerns is the fact you just can’t go to the bank and say you want a loan to cover your expenses for half a year.”

As to whether the problem of a perceived shortage of reps might be rectified in the future, Biggs says that looking out over the next decade, “I don’t know how the real pros can be adequately replaced.” He adds, however, that “If I was about 30 years old today and starting a rep firm with a good solid base, in 10 years I could own the markets I’d work in. I’d be the ‘go-to guy’ that no one else could really compete with. You’d make an absolute mint because there are so many small- to mid-sized manufacturers out there who simply can’t afford to go direct. What this means is that there’s definitely going to be a need for professional reps in the future.”

Business structure — “It’s critical that the professional rep, no matter what the size of the agency, have some form of business structure that allows him to stand out as more than just some guy wandering the streets trying to sell something. This may sound silly, but it’s really important and not all reps can do this. Here are a couple of questions:

• “Does the rep have a plan — a business plan — that they’re able to share with us?
• “If something is broken in the organization do they have the ability to fix it?”

Reputation — “I’m not sure all reps realize the value of their reputations. For instance, I can recall when a customer contacted me to ask that a rep never call on him again. He maintained that the rep added no value, detracted from their work and basically was annoying to everyone. He further said if I continued to have the rep make calls, he would be looking for an alternative for our product line.”

Citing another example, Biggs continues, “How about a rep organization that for the first four months of the relationship didn’t do anything — beyond high-level goals — to execute a plan for selling our products? With that as a start, we then have the privilege of paying them for three more months (because we write contracts that are very fair to the reps), resulting in a year of payments with no identifiable return — including conversations with top-10 customers in the territory that had never even heard from the rep organizations.”

Communication — Biggs maintains that when it comes to those “pain factors” (e.g., call reports and joint calls in the field) that are deal killers for so many reps, Gilman Precision is easy to work with. “When it comes to calls in the field, we only do that about once a year. And, when we do, we naturally want to the rep to help us out, but it’s not big job. Likewise, with sales reports. We don’t ask for them. All we want — and it really just comes down to basic communication — is monthly updates on open quotes.”