With regularity MANA’s LinkedIn discussion page offers thoughts on any number of subjects important to manufacturers and their reps. A good example was posted earlier this year when Lisa Wilson, L.S. Wilson & Associates, Inc., Bristol, Wisconsin, shared her thoughts on what makes a good vs. a poor principal.

How would you define a really good principal vs. a poor principal?

Over the past 21 years, I learned the following about a good principal:

• Will pay commissions even when you retire.
• Will pay you for the life of the part or program.
• Will turn over whatever existing business there is in your territory or is willing to negotiate market development fees.
• Will work with you on pricing so you get the business.
• Will travel with you to a potential new customer to help you secure the business.
• Will always communicate and let you know what is going on so you are not blindsided.

It is advantageous for the sales representative to sign up with a principal that has performed the sales representative function either as a direct salesperson or even better if they owned a sales representative company.

On the other hand, the following demonstrates a poor principal:

• Does not communicate effectively.
• Thinks they can hire a sales rep and have you try to get sales off of existing customers.
• Does not understand the concept of market development fees. (These types of business relationships typically don’t last.)
• Does not want to pay anything upon termination.
• Does not want to sign a contract or wants to work with their contract.

A Sharing of Opinions

A timely and logical conversation among a roundtable of reps transpired at a rep association conference earlier this year that’s certainly related to the previous item. Each of the independent reps that took part in the conversation seemed to relish the opportunity to compliment the standard practices of their top principals. Among the salient comments made in praise of “emotional favorite” principals were:

• “The principals that I go to market with have made an exceptional effort to understand how I operate and they show me that they appreciate the demands I have on my time. What results from this type of relationship is that they don’t expect me to be selling just their products exclusively all the time.”
• “My best principals never expect anything to happen overnight; instead, they allow for plenty of time for planning marketing and sales efforts. Their philosophy is that this approach is the best way to produce realistic results.”
• “My top lines excel when it comes to communication. They promptly answer my requests for information and assistance and always make sure that I’m included in the informational loop.”

Putting the Shoe on the Other Foot

If the beginning of this column discusses what attributes reps seek in their principals, it’s only fair that manufacturers have a say in what they find attractive in their reps. With that thought in mind, here’s what one principal says he looks for in his professional outsourced sales force: “The very best reps are those that spend most of their time on a first-time call clarifying the perspective customer needs that they later use to make tightly tailored presentations on their second and other calls. There’s a tendency today to believe that we have everything we need from the Internet and other sources in order to complete a bang-up sales call the first time. But that’s just not the case. It really takes a face-to-face meeting to truly get a handle on what is going on. I’ve noticed over the years from making calls with my reps that those who sell best are those who operate this way. And they also tend to be those who have considerable experience. The newer and younger people tend to believe that everything they’re able to pull off the Net is true and useable. That’s simply not true. It’s sure a good start, but it’s only part of the entire picture.”

Praise for the Spoken Word

After bemoaning the fact that there’s still too much paperwork to plow through, a manufacturer heaped some praise on those reps “who verbally and proactively provide me with all forms of sales and marketing intelligence, not to mention updates on what the competition is doing.”

This manufacturer, who has been working with reps for more than three decades, continued that there’s another area of intelligence that he’s especially interested in and that’s the plans that the agency has for its future. “If the owner of an agency is taking on a new line, looking at new markets or even planning his exit from the business, these are all things I need to know. Here are a couple of examples of why I value information such as this:

• “In just the past 12 months, one of our best and most productive reps let me know about his plans for the future by turning the business over to his daughter and one other individual. The first thing he did was to let me and his other principals know what was going on. What’s happened is that he’s been assured that all of his principals approve of the plans that he’s working on and they’ve indicated to him that they look forward to working with the new organization.”
• “As is often the case, our reps receive our marketing information and if they feel it’s not going to work for them, they’ll just push it aside and ignore what we’re working on. What happens then is that we have to deal with the fact that our efforts failed not only in his territory, but others as well. In one instance recently, late one afternoon one of my reps called and we had a lengthy discussion on why our one-size-fits-all marketing program just wasn’t going to take hold. While it’s always difficult to be criticized, I took his comments as being constructive and appreciated his candor and willingness to communicate openly with me. I carried his input back to the powers that be, made changes and can report we had a very successful campaign.”

A Difference in Generations

The challenges of working with different generations (e.g., Gen X, Millennials, etc.) have been covered in a number of articles that have appeared in the pages of Agency Sales. That’s why a recent conversation among manufacturers was especially timely. According to one manufacturer, in a group of four, he was feeling a certain level of frustration with the practices of younger reps when it came to networking. In the manufacturer’s view, based on decades of experience, networking with customers approaches the level of socializing. But with younger reps, their view of networking is one that takes place electronically. “Over the course of a number of trade shows and other industry events that we’ve attended together, I’ve tried to impress on them how important it is to establish personal relationships that can only be achieved in person. I’ve made a little progress, but there’s more work to be done. I’ll be honest, however, that at the same time I’m working on them, they’ve been working on me to be more electronically savvy and more open to their approach when it comes to networking and communicating in general. I’d have to say that our joint efforts are beginning to pay off.”

Joint Sales Calls Work

When the subject of the effectiveness of joint sales calls was introduced during the course of the MANA manufacturers seminar this fall, one manufacturer who has long been an advocate of joint selling offered the view that most salespeople, whether agents or direct, are seldom able to penetrate their customers’ organization beyond the level of the individuals who buy or use the product they sell. “We all know how helpful it can be for salespeople to at least be on friendly terms with those in general management at upper levels. A few years ago, however, we came up with an approach that works well for us. Our joint calls with agents aren’t only made with our top marketing people, but they often include key top management, including our CEO. Needless to say, these calls are planned very carefully to provide the customer the opportunity to bring in his top people. Actually, they seem to want to do this. Some are somewhat intimidated by meeting our CEO without having their key people with them. And, of course, this has worked to our advantage. I guess you have to have the kind of CEO that we have who knows that nothing happens until someone sells something. But maybe you can train the bean counters to have broader outlooks too.”

Getting the Full Story

As usual — the devil is in the details. That was fairly obvious when a manufacturer described his switch from a direct to an outsourced sales force. He complained about a lack of immediate success that he had hoped for when the decision was made — but there was more to his story than he originally divulged.

The core of his complaint was that the more than 10 reps he signed on to replace his factory direct sales force weren’t all delivering at the same pace. A little bit of probing, however, unearthed the fact that there was a little information missing from his story. For instance, in three of his territories reps were met with unexpected frustration from several existing customers. It appears each of those territories had run through four sales managers in the past five years. As a result, instead of being able to make complete sales presentations from the get go, each had to do a bit of public relations work to even get in the door to assure each of the customers that the turnover in sales personnel had stopped.

The reps educated the customers as to the reps’ staying power in the territory and let them know that they weren’t leaving for better jobs or promotions in the manufacturer’s business. While this change in sales personnel was hardly a deal killer, what it did was to hamper the reps’ ability to hit the ground quickly.

Added to this were some problems with product quality and delivery. In all fairness, the reps in this case should have probed the manufacturer a bit more deeply to learn these problems existed. But, on the other hand, the manufacturer should have been more forthcoming to let the reps know they’d be faced with these concerns, so they had better be prepared.

When all things are considered it really came down to a matter of communication — or a lack thereof. The manufacturer, if they truly had a commitment to the rep way of going to market, should have put all their cards on the table, leveled with their reps and let them know there would be a bit of an uphill climb before they’d realize the sales success they were anticipating.

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