Issue: March 2022

All Your Eggs In One Basket

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In my January editorial, I quoted a manufacturer who regretted a hiring mistake that put $200,000 of his company’s money down the drain:

“My problem is not that I have been searching for direct sales­people and didn’t find qualified candidates. My problem is that after a long search that didn’t turn up qualified candidates, a year ago I got impatient and decided to settle on the least problematic of the candidates who did apply.”

“Between salary, expenses, and medical insurance, I have spent $200,000 on the salesperson I hired a year ago, and I have absolutely nothing to show for it. $200,000 down the drain. That’s why I am calling you today to talk about reps.”*

The manufacturer and I spoke about the benefits of using reps, but only later did I realize what may be the most important reason to use $200,000 to hire 8-10 rep firms instead of one direct salesperson. Not putting all your eggs in one basket.

Spend $200,000 on one direct salesperson, and if that salesperson fails, “$200,000 down the drain.” Spend $200,000 on hiring 8-10 rep firms, and even if one or two turn out not to be a good fit, most of the reps will succeed, and you will still get a good return on your $200,000 investment.

It’s the same reason that savvy investors like Warren Buffet recommend buying shares in an S&P 500 fund instead of gambling on just one single stock: Diversification. A single stock may tank, but a diversified investment isn’t as risky, so your winners will probably outnumber your losers.

That’s another reason manufacturers should spread their sales investment over a nationwide rep network instead of hiring a single direct salesperson.

Because it’s too risky to put all your eggs in one basket.

* The manufacturer’s comments have been edited for space and clarity.

Things Change

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One thing that’s guaranteed in life — things change. Sometimes the changes are significant. For example, just look back at the past two years. Life today differs significantly from what it was in 2019. Other times, the changes are gradual, sometimes so gradual we fail to notice.

In the manufacturers’ representative world, the companies the manufacturers’ representatives work with change. The company name remains the same, but it’s no longer the same company you signed up with 10 years ago. The same applies to the manufacturers’ representatives the manufacturers work with. In some cases, the changes are positive and the … Read the rest

Post Covid: The Future for Reps

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MANA members, just as other businesspeople throughout the country, are gradually emerging from a tumultuous year. While the challenges for many have been daunting, a remarkable number of association members report that they have weathered the business, economic and Covid-related storms quite well. As a matter of fact, several reps report that by making specific changes in how they conduct business, they have enjoyed record or near-record years.

In an effort to pass along some success stories, late last year in the course of a MANA panel discussion, three MANA reps reported on changes that have proved positive for them.… Read the rest

Letter to the Editor

Response to the “Post Covid: The Future for Reps” panel discussion

I wanted to start off by thanking MANA for putting together the panel discussion. I had a few critiques about the call that I wanted to share with you in the hopes that we might revisit this very important topic about the “future of the manufacturers’ representative profession.”

My takeaway from the panel/call was that it focused more on the effects of COVID-19 on our ability to conduct business, some of the changes that were made, and ways they succeeded in the new environment, but seemed to lack any … Read the rest

No More Business as Usual When You Double Down on Remote Sales

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Enterprise change comes slowly. Could perfecting remote sales processes help speed it up?

The enterprise sales cycle is typically measured in months, if not years. Products and services are often complex, and when you’re helping companies automate their vendor payments like I am, you’ll end up working through some process changes. Quite often, the sale involves a significant amount of dialogue around changing the “status-quo.” As with most enterprise offerings, there are multiple stakeholders and decision makers, each with their own concerns about the impact of change.

Expert Guidance at Every Step

To make sure everyone understands the value of … Read the rest

Nine Steps to a Service Culture

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Never has customer service been as critical as it is today. That became apparent during the pandemic when millions of people around the globe relied on businesses that could provide what they needed to survive — personally and professionally — and as quickly as possible.

In order to distinguish you and your business from your competitors it is imperative that you create a service culture that runs throughout your company, from frontline employees to the CEO.

I’ve developed what I describe as the “nine principles of creating a service culture.” A service culture focuses on doing whatever it takes to … Read the rest

Avoiding Two Major Traps of Self‑Commoditization

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One of the greatest frustrations facing senior leaders and their sales and marketing organizations today is that their customers are treating their high-value solutions as commodities.

What they don’t realize is that they themselves are probably more to blame for this problem than any external force. Self-commoditization is the most significant threat to success in selling high‑value solutions, and your sales processes and behaviors are likely the largest contributing factor to that exposure.

If your sales organization’s proposal conversion rate is decreasing and the percentage of “no decisions” is increasing, your company may be commoditizing itself. Your sales process may … Read the rest

Making the Hard Decision About Poor‑Performing Employees

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More and more, I find myself repeating the same advice to my clients daily, “It’s never the right time to make a hard decision.” While this is applicable to several situations, I want to describe a particular one — and that is making the hard decision about poor-performing employees.

Nowadays, you’ve probably been affected by many businesses operating on limited hours and/or services due to a lack of employees. We are still experiencing what HBR Blog and Forbes have dubbed the year of the great resignation. For managers and leaders, this shortage of staff has meant tolerating behaviors that run … Read the rest

How to Know If a Lead Qualifies as a Prospect

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Does your lead even qualify as a valuable prospect?

Your time is valuable. Your skills are valuable, too. So, before you get too cozy with any lead in your pipeline, it’s worthwhile to take a moment to evaluate. Is this a prospect I can move forward with, or just a suspect?

I have seven questions you might ask yourself about a lead before you invest any more time and effort. If your lead can’t pass this test, you’d be wise to reevaluate the relationship.

1. Does It Match Your ICP (Ideal Customer Profile)?

I see so many salespeople who have … Read the rest

Emotionally Intelligent Selling

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Many sales professionals talk about the value of emotional intelligence, also known as “EQ.”

Emotional intelligence is the ability to perceive, control and evaluate your own emotions while being in tune with and empathetic of others’ feelings and behaviors. The ability to express and control your own emotions while being highly perceptive when it comes to others’ emotions is critically important in sales. Similarly, it’s even more important if you have a leadership role in your company.

According to author Daniel Goleman, people with high emotional intelligence can recognize their own emotions and those of others, they use emotional information … Read the rest

Building Trust and Rapport in Business

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You’ve probably heard the sayings that “People don’t care how much you know until they know how much you care,” and “People need to know, like, and trust you before they’ll do business with you.” The truth is: until people know you care, most view you simply as a salesperson trying to make a sale. With that in mind, how do you build trust and rapport rapidly and let people know you have their best interest in mind so you can move toward the sale?

Here are seven ideas to build trust and rapport.

1. Treat Everyone You Meet as … Read the rest

Conducting Due Diligence

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After participating in a virtual conversation with three of his reps on the continued importance of reps regularly evaluating their principals, a manufacturer offered his thoughts on doing the opposite.

“I annually review how my reps are performing and when I find a problem or determine that something is amiss, I take care of it right away. Here are a few of the things that I’m concerned with.

“Before I even choose which reps to work with, I learn all about their length of tenure in the territory. After that, however, I regularly evaluate:

  • Among their lines, how many are
… Read the rest

The Rudest Thing You Can Do in a Virtual Meeting

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I should qualify that title. As you can imagine, there are plenty of inappropriate behaviors that people could display on Zoom or Teams. Some are obvious: taking phone calls, talking to coworkers in the background, forgetting to wear pants (yikes)! In terms of virtual rudeness, I’m referring to the most common etiquette sin many people commit in the first five seconds, without being aware of it.

I’m referring to logging in “late,” and by late I mean arriving at exactly the appointed meeting time. I learned the lesson decades ago as a university student at a business class where they’d … Read the rest

The Force of Force Majeure and Other Contract Performance Excuses in Supply Chain Transactions

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How best do suppliers navigate through the allocation of risk and damage associated with the forces placed on the supply chain by the COVID-19 pandemic?

In order to answer this question, we will need to understand the legal concepts which allow suppliers some degree of forgiveness, under certain circumstances, from the strictures of their supply agreements when unforeseen events prevent their timely supply of goods. Here is a brief overview of the current supply-chain climate and some legal concepts that may be invoked to relieve pressure of supplying needed goods that are in short supply.

Foreseeability and causation are key … Read the rest