The question of how many agencies a manufacturer should have working for him in the field was raised during a roundtable discussion among manufacturers earlier this year. One manufacturer noted, “The real question shouldn’t be how many agencies you need, but how should the territories you want covered be created?

© viperagp | stock.adobe.com

“It’s not unusual that agent territories that companies wind up with bear little resemblance to the territories the manufacturer had when they were working with a direct sales force. The typical rep has several people out in the field and they usually cover a much larger territory than the single factory man did.” He went on to cover a few considerations to keep in mind when making the move from a direct sales force to an outsourced (rep) sales force:

• Determine that the agency’s marketing goals are compatible with those of your company.
• Make sure the agency covers an appropriate territory. Size of territory is not the issue. It’s the customer concentration and the agency’s ability to maximize its penetration that really counts in the end.
• It’s not as easy as it might seem for a manufacturer to locate the rep firm that is the best fit for their line. To allow yourself the best chance of achieving a good fit, it’s critical to meet and speak in depth with agency personnel before making a decision.

Putting a Face to the Voice

Principals and reps generally agree that being able to put a face to the voice they hear over the phone can be critical in a business relationship. That’s why one principal reports that among the first steps he takes after signing on a new rep is to arrange face-to-face meetings with not only his company’s management team and inside support staff, but with the other independent reps that work with the manufacturer. “Before I joined this company,” the manufacturer explains, “I spent close to two decades in the field as a rep. If I learned nothing else in all those years, it’s the value of having a personal relationship with the people I work with and for. That’s why once the rep has placed his name on the dotted line, I bring him into our headquarters for a couple of days’ orientation And, as a part of that orientation, I put him together with all of our people, whether it’s in informational meetings or a lunch or dinner. I can see the relationships building before my eyes.”

He continued, “Once a year we either bring all of our reps into headquarters or we conduct a national sales meeting at one of our industry’s annual conferences. It’s there that we make sure all of our new reps have an opportunity to network with their peers — without me looking over their shoulder. One of my reasons for insisting on this is that I learned long ago that there are no new problems faced by reps. If any individual rep has a problem/concern/challenge, chances are one of his peers has already solved it. I’ve seen that happen with regularity.”

What Does a Rep Really Do?

Based on conversations and other forms of communication with Agency Sales, reps are usually pretty fair when it comes to shouldering the blame for the lack of understanding among customers and manufacturers concerning the roles that the rep plays in the sales process. It’s not unheard of for a rep to note that “Manufacturers don’t really understand what we do. We see that when they hold on to house accounts or are reluctant to provide us with any fair form of post-termination compensation.”

When asked why there’s little understanding on the part of the manufacturer, the rep will respond, “I haven’t done a good job to educate him or to let him know what my true value-add is.”

While the rep should be doing more in that regard, there are a few things manufacturers could do to enlighten themselves. High on that list is attendance at MANA’s Manufacturer Seminar — like the one scheduled for October 10-11 in Chicago. For years these seminars have presented the perfect educational forum to allow the manufacturer to know that the rep does much more than just make calls and follow up. Check the MANA website (www.MANAonline.org) for more detailed information.

Ensuring the Effectiveness of Face Time

While one manufacturer maintains he’s a true believer of the importance of reps’ face time with customers, at the same time he’s learned to value what the Internet brings to the rep-customer relationship.

According to the manufacturer, “One important byproduct of the proliferation of information on the Internet is that our reps now have more office time and considerably less face time with their customers. While I can see the negative in this, I’ve learned that there’s also an important positive. A good number of the leads that are developed come from the Internet. Once that lead is received, a good deal of time can be spent ensuring that the rep has the correct product available to address application needs. Then, when the rep finally sets foot in the customer’s place of business, I’ve found that our reps are fully armed with all the information they need and they know all the questions to ask in order to get the order. That doesn’t mean face time isn’t still important; however, it’s just that now a lot of work can be done ahead of time. And, it’s the reps who are truly savvy with electronic communications and the information emanating from the Internet that can realize the benefits of this change.”

Putting the Best Foot Forward

Fresh from the “What have you done to impress me lately” category comes a communication from a manufacturer concerning two of his reps. “We were at the point in our company’s growth where we needed to fill representation holes in two territories. We went through our standard process for locating and signing agencies. And, as usual, we did a thorough job and made excellent choices. However, we were surprised — if not gratified — with something that our two new reps did. Both reps, both of whom were quick to boast of their long-time membership in MANA, made it a point to sit down with us so they could share their annual business plans. Not only did they share their information with us, but they asked for our input as to what they could do to better serve our needs and the needs of our mutual customers in the territory.

“To say we loved this proactive approach is an understatement. We’ve even gone so far as to suggest to our rep council that more reps follow that approach. Our suggestion was readily accepted. We couldn’t be more pleased by this huge step in the direction of improving communication.”

Turnover — Reps to the Rescue

A manufacturer recently bemoaned the time he had to spend concerning himself with turnover among his direct sales staff. You guessed it! Another manufacturer responded to his predicament by noting that after several years of addressing the same problem, he got rid of it by partnering with reps. “There’s been little or no turnover among the reps I work with,” he said. “Part of the reason is that in choosing reps in the first place, I make sure we work with agencies that have long and deep roots in their respective territories. I’ve found that’s where they want to live and work, and I don’t have to be concerned with them looking for a promotion to the home office. And when one of their salespeople does leave, the problem is only indirectly mine. The agency solves it, and my experience has been when they’ve brought a new person on, they’re more than up to the job.”

Easing the Payment Process

After a good deal of research, a manufacturer reported that his company has begun the process of paying his reps’ commissions via automatic deposit. “We started this a little over a year ago,” he explained. “We’re not making it mandatory with our reps, but we’re taking steps ahead of time to educate them regarding how this is not only beneficial to us but also to them. For instance, with automatic deposit, the money is available to them immediately — there’s no waiting for the check to clear. Then there’s the fact they don’t have to make trips to the bank, and the accuracy of their checks is at a high level.”

He added that there were hardly any internal accounting changes that his company had to make, and “by and large this has been a win-win for all of us.”

The Value of the Field Visit

If there has ever been any doubt concerning the value of a manufacturer visiting with his reps in the field, read what two reps have to say on the subject. “When the principal takes the time to travel with us, that’s a true indication of how interested he is in us. This shows our agency how much he cares about our problems and what we run into in the trenches. And, the benefits of such visits grow geometrically when they contract us well in advance to let us know they’re coming and what they hope to accomplish. It’s hardly a waste of time.”

MANA welcomes your comments on this article. Write to us at [email protected].