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“We’ve always done a good job of providing product information to our network of independent manufacturers’ representatives especially during our annual sales meetings. But after that, experience has shown us that our sales meeting content sort of falls flat.” That’s how one manufacturer described his company’s experience when it came to providing information for their outsourced sales force.
In an effort to counter a good amount of wasted time during these sales meetings, he went on to explain a couple of things he incorporated into the meetings that have really paid dividends “for both us and our reps.”
“In addition to the always appreciated product information, we took special pains to zero in on new application information and the need for both us and our reps to share market intelligence.
“Beginning with the product applications, we’ve found that among the best ways to expand the market for many of our products is to find and document new applications. This doesn’t mean that we and our reps have to seek out totally new fields. Rather, we urge our reps to focus on the fact that many of the customers who purchase a product for one application very often can put it to use elsewhere. What’s that mean? Obviously, that translates into increased sales.”
The manufacturer continued, “It’s not unheard of for one of our reps that has uncovered an innovative application to be more than willing to share their information with other agencies.”
On the subject of market information, he said, “Obviously, our need for market intelligence is quite different than the need of our agencies’ personnel. While we’re both concerned with a big picture view, our agents really want to know what’s happening in their own territories. Our feeling is — and this is something we do — those who subscribe to the use of market information should personally present the relevant information when they meet with their agencies. Remember though, it should be done in capsule form during the meeting and detailed information should be supplied in written form after the meeting. We’ve also learned that it’s most effective to not pass out material before the sales meeting. If the details are read beforehand, or during a presentation, the provided material really loses all of its steam.”
Relationships Result in Communication
There came a time when one manufacturer was getting very concerned about the advanced age of the owner of one of its most effective independent manufacturers’ representative firms. “We’ve been working with this agency for just about 23 years. As a matter of fact, the agency was one of the first I signed when I first joined the company. I know time passes and it really shouldn’t have been come as any surprise that the owner of the agency was now in his late 60s. What happened next, however, is really a testament to the relationship we established and nurtured with this agency over the years. Before I could even contact him and ask what his plans were for the future, he came forward with details that more than put my mind at ease. Not only that, but he asked for my input on his future plans.”
According to the manufacturer, the agent was just as aware of his advancing age that’s why he initiated a plan to attract some younger blood with the intention of gradually leaving the business in competent hands. “My only point in mentioning this is to emphasize how important it is for a manufacturer to work on their relationships with their reps. If they make an effort to have them feel as if they’re a part of the corporate family, then there won’t be any surprises. On the contrary, when anything of importance is in the wind, your reps will probably come forward proactively with the information you need to plan for the future.”
Surviving an Agency Ownership Change
A timely follow-up to the previous item came in a phone call with a manufacturer that described what went on when one of his long-standing agencies went through an ownership change. According to the manufacturer, “Here’s why the changeover was so easy and why we continued working with the agency: The rep principal let me know the approximate time frame when they were going to leave the business. In addition, they went out of their way to introduce me to the new owners and allow us to establish a relationship before leaving. And finally, the rep principal made it a point to seek my advice and sought my counsel all during the process. As I said, we’re still doing business with them, and perhaps more important, they’re still one of our top-performing rep firms.”
Advocacy for Agents
Granted the national sales manager carried a bias with him since he used to be an independent manufacturers’ representative, but his advocacy for using agents was borne out in a remarkably short period of time. Here’s how he relates his experience: “I had been a rep for eight years in my father’s agency. When an opportunity presented itself to work for a manufacturer, I took it knowing that I’d have to do some persuading to get the company to make a move from a largely direct sales force to one more dependent on independent reps.
“I was right, it did take some persuading of company management but now just 18 months after making the move we’ve got the metrics that show it was the right thing to do. Already we’ve seen an increase in the number of customer contacts that our reps make vs. what we had with the direct sales force. With that, there’s been an increase in overall sales and we’re more confident that we’re properly covering the territory over what we did in the past.
“We’ve also found that the reps we chose to work with have a far greater appreciation of the local product needs than our direct salespeople had. As a result, they have been able to provide us with constructive feedback to modify product design, advertising or promotion that is tailored to a specific territory.”
Getting to Know All There Is to Know
When a manufacturer described one of the major steps he took immediately after making the switch from a direct to an independent sales organization, you knew he was serious about making the change work.
According to the manufacturer, “I knew I couldn’t just flip a switch and make the move. Once I decided upon using a network of reps, I knew I had to accustom my inside sales force to work with the outsourced reps. Ultimately, I felt I had to put my people in the field to meet and work with reps just so they’d know how the job was going to get done. But first, we needed some time for them to get to know each other via, phone, e-mail, etc. After about two months I asked the agencies we were working with if some of our inside people could visit with them. Since I had explained my methodology to them, none of the agencies refused. As for my people, I made sure they were all prepared to meet the reps.”
Establishing Ground Rules
As a follow-up to the previous item, the marketing director for a mid-sized manufacturing firm described a step he took at the beginning of a relationship with new reps. “We’ve made it a habit,” he says, “to send a questionnaire to about 50 agencies asking them how they work with manufacturers like us. My goal in doing that was to learn the norms for reporting, commission payments, quotes, follow-up and everything else that’s important to reps. Once I’ve been armed with their feedback, I was able to create a set of ground rules that are acceptable to us and to most of our agents. I’d be lying if I said those ground rules are never broken, but by and large I’d have to say that everyone knows in advance just how we’re going to be working with each other.”
The Desire to Improve
When a relatively small manufacturer was asked what he looks for when seeking independent representation, he acknowledged that naturally he always seeks out firms that have tenure in the territory, boast strong customer relationships and are willing to share their business plans with a manufacturer. But, he added two more considerations that he’s found valuable over the years: a willingness to participate in regular visits to the factory and a desire to improve their product knowledge and sales skills.
When it came to factory visits, the manufacturer offered, “It really gets our attention when a rep will take the initiative to schedule such visits. We really appreciate one rep who, perhaps taking it to an extreme schedules his next visit as soon as he’s completed the last trip here. The rep maintains that this allows him to better keep up on our new product developments and renew contacts with factory personnel. On top of that, these visits allow him plenty of time with our company management team. In my opinion, we get more done during these relatively short visits than we ever would by visiting him in the field.”
On the subjects of improving knowledge and sales skills, “It’s the reps who are constantly striving to improve their knowledge of customer needs and market demands who work the best with us. In addition, it’s those reps who stand out from the rest when it comes to getting their arms around technological developments who are the ones who have performed best for us.”
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