© Robert Kneschke | stock.adobe.com

As a manufacturer sales manager was approaching his retirement late last year, he let us know how the years he spent working with reps allowed him to appreciate some of the benefits of working with an outsourced sales force.

According to the manufacturer, “When I started close to 40 years ago, there was always the perception among many in my company that reps in general didn’t work all that hard for their commissions. And what did they get in return for not working too hard? Nice, fat commission checks. As I look back over the years, however, I’ve come to the point that while reps were right for us then, they’re even better for us today. Today’s rep does much more for the customer and the principal than they ever did then. They perform at a higher level because they’re firmly entrenched in the high-information era of the business. They detail their day-to-day activities, communicate with customers and us, they undergo product and sales training and constantly monitor their accounts. If anything, I’d have to say that we’re more in touch with what’s going on in the territory than we were in past years.”

Why Reps?

Closely related to the comments of that previous manufacturer, when a group of principals and their reps initiated a conversation covering the problems that could occur when a rep regularly starts getting checks that are larger than those of the principals’ employees — not to mention executives — one manufacturer’s national sales manager offered his thoughts: “I know it happens, and I know it can impact the morale of the people who work for us, but what I’ve done in the past is to remind our people that reps:

• Only get paid when they make a sale.
• Provide us with more feet on the street than we could normally afford.
• Create an immediate presence for us in the field.
• Are on their own. They pay their own expenses.
• Bring with them the customer contacts and a knowledge of the territory that would take us a long time to ramp up.”

He continued that he contrasts those points with the fact “our direct salespeople get paid whether they sell or not. Naturally, if they don’t perform over a period of time — we’d make a change. But, in the meantime he’s compensated for his time. We have to pay all their benefits and those benefits include the complete manufacturer support network. I finish my message by letting everyone know that whatever amount of compensation we’ve sent to the rep should be weighed against what the rep does for our company and then what he had to do for himself when it comes to running his own business.”

He concluded that with very few exceptions, this approach has always worked for him and his company.

The Importance of First Impressions

We inquired of one manufacturer what she thought counted most in her decisions to appoint the outstanding agent team she has built over the years. She let us know that her initial response to an agent candidate depended heavily on one factor — “I think the best agents want to know about you first and foremost. They don’t jump right in and tell you how great they are going to be. In addition, I’ve discovered that those who want to know about us first already know a lot about us. It’s just their way of showing that they have a genuine interest in us and that they aren’t blowhards. Also, they show us that they have a high understanding of our needs and of our customers’ needs. I have appointed agents who were less technically qualified than other candidates simply because I felt they had these traits. I was right. They learned the technical side of our line quickly enough, but were able to get comfortable with us and our customers and prospects almost immediately.”

Help in Selling Ideas to Management

The sales manager for a division of a large company that sold through agents had some very good ideas that he found difficult to sell to his management. He explained, “The ‘suits’ don’t think the same way we marketing and salespeople think, so it’s often difficult to get them to accept new ideas. They like to work with the known and not the unknown, and the known is most often a balance sheet — only. After being rebuffed too many times, I decided to first get input from my team of agents before presenting my ideas to management. When the ideas had merit, I asked the agents to provide me with supporting information, such as sale projections and competitive data. I could, of course, get this stuff myself, but when it came from the guys on the front sales line, it had a great deal more impact with my management. So, my advice — don’t try to be a hero, get help from your reps. Nine times out of 10 the idea will fly with your management.”

Searching for the Best

Manufacturers never stop looking for the very best representation. Manufacturers who are sold on the rep model of taking products and services to market are always on the lookout for the ideal agent to represent them. Well, just as the manufacturer scrutinizes that hot job prospect right out of college, he should be just as careful when looking for an agent, and it certainly helps if the agent has something in his hands he can show the prospective principal, something along the lines of a resume. There’s simply no better way for the principal to get to know a prospective rep’s capabilities.

One long-time industry consultant put her thoughts in order on this subject. The principal should be looking for a well-presented history of the agent and a description of the agency — including its capabilities. Manufacturers should require a profile of the personnel and their abilities, a line card and any articles that have appeared in the industry press concerning the agent and the agency.

And, given the proliferation of information on the Internet these days, never forget what a professionally created and maintained website can accomplish. Many manufacturers have maintained that agencies featuring a well-put-together website have a leg up on the competition.

Dealing With Bumps in the Road

During the course of an interview with Agency Sales, a manufacturer recently detailed a highly unsatisfactory relationship that he just severed with an agency. The manufacturer maintained that he did all his homework before choosing his rep, but still from day one the orders never developed. He felt he never got enough of the rep’s time, and bottom line, the needs of the customers simply weren’t being met.

Advice on how to avoid this not uncommon pitfall could fill volumes, but a couple of things this manufacturer — and any manufacturer for that matter — should keep in mind include these:

• Be sure you’ve chosen the right rep for your company and the products or service you provide. Achieving this goal means finding the rep who is already successful, i.e., one who is a mirror image of your own company operating philosophy.
• Once chosen, the rep must be fully and completely supported by the manufacturer. That “support” takes its form from everything including a basic honesty in the relationship, prompt delivery of products and payment of commissions.
• Above all, the benchmark of any firm manufacturer-rep relationship is the honest communication between the two.

No Shortage of Sage Advice

A conversation with a long-time, rep-friendly manufacturer developed some valuable advice on what attributes the rep of today — and certainly tomorrow — had better possess if he wants to survive and thrive — and it’s a far cry from the talents of yesteryear.

The manufacturer advises, “The rep had better be someone who’s well-rounded and isn’t primarily occupied with closing the sale. Rather, manufacturers need reps who think strategy and planning — not just how many of what product the customer needs.”

He continues that the kind of rep that manufacturers should be looking for “should be as interested in the business page and Wall Street as he is in the sports pages. In addition, he’s someone who’s always a step ahead of the customer, not only anticipating his needs, but at the ready to meet those needs before the customer realizes the need is there. In other words, he has a mindset that ‘I’m going to be there waiting for the customer.’”

Building and Maintaining the Relationship

Attracting, nurturing and retaining top agencies serves as the three-tiered formula for success one manufacturer recently shared. According to this principal, it’s relatively easy to get the initial attention of a top agency in a territory, the key to marketing success, however, is to maintain that interest. This particular manufacturer explained that he’s made it a practice to fully communicate, support and involve the manufacturers’ reps in his long-term plans — often via conducting rep council meetings and publishing a rep newsletter. “By doing that,” he maintained, “the rep knows that we’re committed to the partnership and he’ll give me more than my share of time in the field.”

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