With a fair amount of justification, relationships between independent manufacturers’ representatives and principals can be compared to a marriage. After all, what both sides are seeking is a long‑term relationship, based on trust, that results in a good deal of mutual benefit.

Just as any marriage, however, whether it be successful or unsuccessful, there can be roadblocks to navigate as both sides work toward their mutual goals. When those roadblocks crop up, what’s to be done? That’s the question that was posed to several MANA members and Agency Sales readers and if the truth be told, their answers or solutions to problems aren’t all that surprising. What comes through loud and clear after several interviews is that the keys to long-lasting, beneficial relationships reside in a serious practice of communication, honesty, maturity and mutual respect.

Practicality is emphasized by regular Agency Sales contributor John Haskell, Dr. Revenue Marketing Clinic, as he kicks off the discussion on this subject. According to Haskell, “Diplomacy of the highest order is the key to any discussion emanating from the rep to the principal.” He adds, however, that “A lot depends on how big a percentage of the rep’s income is involved with the particular principal. The smaller the percentage, the easier it is to have a more open discussion. But perhaps the greatest consideration here is that the rep must keep his or her ego out of it as much as possible. Like it or not, reps need to always remember — they (manufacturers) can always do without us!

Resolving Disagreements

As he considers the question of how to resolve a relationship disagreement, consultant Allan Lamberti, Billiken Group, LLC, Atlanta, Georgia, recalls a time when he thought he was comfortably sitting on the manufacturer’s side of the desk and encountered such a problem. “I remember once when I was the vice president of sales and we had to implement an across-the-board cut in our commission payments to all of our reps. Management made the decision, which I was not in favor of, to cut commissions from 6 percent to 5 percent. It was the company president’s view that this was simply a 1 percent drop, however, our reps rightfully knew the cut represented a drop of more than 16 percent in their income. Not all of our reps took this decision lying down. Thankfully, those that fit into that category insisted upon making their case to our company president. I think that because the message came from them — our outsourced sales force — and not from me, the decision was rolled back.”

He continues that the key here is communication. “If a rep isn’t getting the answers he needs to get the job done, he should feel free to take his message up the ladder. Hopefully, over the years, the owner of the rep firm has done his job when it comes to positioning himself with everyone — including the president — of the principal’s company. If he’s done that, he knows he’ll get an audience and he doesn’t have to let a situation fester and grow worse. Bottom line here is that everything in life is communication.”

Cool Off and Communicate

In general, cool off and communicate are the two most common nuggets of advice that independent manufacturers’ representatives offer their peers when it comes to handling disagreements with principals.

“Whenever I’ve had a serious disagreement with a principal during the more than 40 years that I’ve been an independent representative,” explains Howard Collier, Collier Corporation, Avon Lake, Ohio, “my course of action has been to communicate with him, face-to-face if possible, and then write a follow-up communication telling him what I think is wrong.”

While Collier’s approach is one that has been developed over years of experience, he adds that in establishing relationships with principals he’s always followed advice given to him years ago by a seasoned pro. “Back when I opened my doors in 1966, I had an older guy tell me that the absolute best time to make any points with principals is prior to signing a contract. After that you could have problems. The key here is to be firm when putting the contract together. And in doing that, be sure to get advice from a professional. That’s the best way to establish your relationship.”

Bryant Callaghan, Tri-State Marketing, Cincinnati, Ohio, prides himself on the fact that he’s been fairly successful in being able to steer clear of problems that have ever escalated to the point of having to take legal action. “If possible, you always want to avoid going to court.” He’s done that by “always making an effort to speak with principals when an issue develops. The key here is to determine why they’re doing something that might adversely affect me and their other reps. Too often they don’t even realize that their decision is a matter of concern to reps. If you don’t address the problem at the very beginning, it’s only going to grow larger.”

Working the Local Contact

Geoff Wienke, IS/M Industrial Sales Marketing Inc., Raleigh, North Carolina, works with a number of international principals. Based on his experience, he maintains, “Whenever some decision or disagreement occurs that might impair the relationship, I’ve found it’s much better to try and work it out through the international company’s local direct person. If resolution is impossible, as a last resort you can try and solve the problem by contacting the company’s executives overseas. But the most important thing is to communicate and not let a problem continue.”

The old axiom of “It’s not rocket science” is relied upon by Russ Sorrells, Advanced Solutions for Manufacturing, LLC, Fort Mill, South Carolina, when he describes his philosophy of problem solving with principals.

“What you’ve got to do is try and understand all the dynamics of the problem. Part of that is to be careful to not attack the person when problem solving; rather you’ve got to go after the problem and not make it personal. What I’ve found is when we attack the person and not the problem, emotions come into play and that’s not good.”

Once you’ve come to terms with not making an emotional response, Sorrells says it’s now time to make a phone call. “I emphasize the importance of making a phone call because too many people will hide behind an e-mail or some other form of less-than-personal response. By hiding in that manner you can actually exacerbate the problem and allow people to become defensive, and that’s the last thing you want to do.”

He continues that depending upon the severity of the matter (e.g., commissions being discounted, product quality, etc.) “A phone call may not suffice. Instead of just making a phone call, I’d take the step to set up a meeting with the company president or vice president. Sure, their initial response is generally going to be defensive, but if the rep approaches the matter where they’re not attacking a person but going after the problem, you’ve got a better chance of having a hearing.

“The most effective approach is to first seek to understand before being understood. Try to learn what their thoughts on the matter are; ask probing questions; learn what their objectives are.”

Sorrells adds that he resists the temptation to run to an attorney when a dispute develops. “My first step will be to look back on our contract and determine if both of us are living up to the terms that we’ve agreed upon. Ultimately seeking out an attorney isn’t where I want to go. I want to work out any disagreements face-to-face. If you don’t make that effort, the matter is simply going to fester and I’ll wind up getter madder and madder. Just say to the principal ‘Let’s work this out before the situation gets any worse.’”

Just as most of the others interviewed for this article maintain, Sorrells says “It all comes down to communication. We’re dealing with people and people communicate. And when it comes to communication, what helps me personally is to first have empathy. I strive to put myself in others’ shoes. Are they not aware of what my expectations are? If they are, then I caused the problem because I didn’t lay out my expectations to them. In that case, I must understand why. First, look within and understand what we’re expecting and then we can put ourselves in their shoes. When we can address the issue from a mature perspective it’s because we‘ve thought it through from both sides.”

Learning From Wine

As he entertains the question of how to address disputes with principals, Sid Ragona, Ragona Scientific, Pittsford, New York, cites lessons he’s learned from the world of wine. “While it’s taken me years to put into practice what I’ve learned from a friend who’s a wine connoisseur, the lesson has been very valuable.

• “First, when something negative happens, let it breathe for 20 minutes. Never execute a knee-jerk reaction.
• “Second, just as many people do when trying a new wine, don’t be afraid to solicit and pay attention to someone else’s opinion. I don’t know how many times I received an e-mail that will affect me in what I perceive to be a negative manner. Have someone else read the communication and see if they get the same message. Maybe they’ll have a different interpretation.

“As a result of following both of these suggestions I’ve learned that when it’s time to respond, I’m a bit less red and puffy.”

What it all comes down to, he maintains, is an appreciation for being willing to communicate in a mature manner. “A good number of my principals are international manufacturers. And no matter how I strive to compose the most elegant e-mails, all too often the true meaning of what we’re saying to each other can get distorted. That’s why it’s so important to use any and all means of communication, whether it’s e-mail, phone or in-person. And once you’re in communication with the principals, be sure not to be emotional and take pains to go after the problem and not the person.”

An Emotional Reflection

In an additional bit of advice, Ragona describes the importance of looking at himself when he’s communicating via phone or e-mail with a principal. “Where I work there are a lot of windows that allow me to see my own reflection. In addition, I have a mirror near my phone/computer. When I communicate, I make sure to look at my face. Skype communication is another method of accomplishing this. This allows for you to compose yourself when you’re communicating. What I’ve realized over the years is that when I speak on the phone, I have the habit of scowling. When I look at myself, I let myself breathe and reflect upon what I’m trying to communicate. You can see the expression on your face and it allows you to calm down. It’s amazing how your communication changes when you see yourself smiling.”

Attesting to the effectiveness of his communication method, Ragona says “I had a recent episode with a potential customer. When I let him know that delivery of the order would take five months, they lost interest. Then they went past me directly to the principal who said he would strive to do better than five months. I resisted the immediate phone call or nasty e-mail to the principal. I let it breathe before I communicated. Then I looked at my reflection. Once I did, I was composed and professional in my communication. The result was the principal said he was going to put the potential customer back in touch. All that was needed was communication.”

Ragona concludes by noting that “I’m glad I’m not a younger version of myself and I’ve been able to learn from others.”

A reemphasis on the importance of communication is forthcoming from Doug Tvedt, PSR Sales, Platte City, Missouri, who maintains that “All too often when principals make decisions that adversely affect the relationship between themselves and the agency there’s not a great deal the rep can do about it. That’s owing primarily to a concern that the rep will simply lose the line if he complains.” He goes on, however, to recall a time when his agency was involved in what he referred to as a “death spiral” with a factory when face-to-face communication was absolutely called for. “What happened,” he said, “was that our commission sales were declining and instead of trying to determine why or even help us, the factory decided that the best solution was to blame us and solve the problem by simply taking customers away from us. This was obviously a time that required what I’d call a professional conversation between the agent and the manufacturer. And, if more than a phone call is needed, I wouldn’t be afraid to fly to the manufacturer’s factory to discuss it face-to-face. What it all comes down to is a willingness to communicate.”

He adds that in all honesty, “That’s exactly what we did in this case. No real solution to the problem was forthcoming, but at least the principal was made aware of our position. It was certainly much better than saying nothing.”

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