What’s better in the eyes of principals:

• The large, multi-person agency, with plenty of feet on the street that represents 15-20 lines?
• Or, the small, in many cases single-person agency, representing relatively few lines?

That was just one of the many questions asked and answered during the course of a MANAchat devoted to the concerns and challenges of the single-person agency. While there was obviously a bias in the way the participants of the chat addressed that topic, here are some of the views that were expressed.

Kicking off the discussion, one rep explained, “My recent experience has been that many of the principals I deal with have let me know that more and more manufacturers are opting to use reps vs. direct salespeople in the field. The reason for this — among others — are the financial considerations and the fact that reps tend to establish and retain relationships better than factory salespeople. Speaking only on behalf of my own agency, we’re number four in our territory vs. other agencies when it comes to comparing the number of lines we represent and the number of feet we can put on the street. In all honesty, I’m a single-person practitioner with occasional help from my wife and son. However, our principals prefer us because we’re more like a boutique agency. We only have four, sometimes five lines. One among those lines is what I’d call a platform product that we’re able to create a lot of activity with. Our principals like us because of what we bring to the table. They tell us that when it comes to the larger firms, they’re very much aware that the larger agencies can hardly be experts in the 15-20 lines they represent. With us, however, they find we know a lot about the few lines we represent vs. knowing very little about a much larger number of lines. Granted I’ve been very lucky that I have a real producer among the lines I represent and there’s certainly a real payback to the principal in terms of what I do for them.”

With that as a start, the conversation then turned to a trend many of the rep participants said they’ve been experiencing, that is a rep being retained by a principal on an account vs. an exclusive territorial basis.

According to one rep, “I’ve been retained on a territorial basis and even though I’m a single-person agency, the territory — covering multiple states — is just right for me. The advantage of operating on a territorial basis is that if the principal develops any leads, the whole territory is mine and I get credit for the business.”

The World Is Shrinking

If that was one rep’s view, a second chat participant offered, “If my contract with the principal calls for me to be retained on a territorial basis, then in fact I’m handcuffed to the territory. But the fact is that technology has changed the world and depending upon the industry that I serve, I can touch anyone in the world. My goal has always been to get in front of the person that I’m dealing with, but Covid certainly hastened a change. It’s difficult to get in front of people today. Now virtual calls are the way to go. People know that you’re not in their neighborhood, but that’s not a problem. The world is a lot smaller than it used to be and reps have been able to adapt.”

Regardless of whether the rep is operating on an account or territorial basis, it was agreed that “The major consideration here is the trust that the rep has been able to establish between their agency and the customers that they serve. It’s all about having strong relationships and if the customer trusts you, then they’ll continue to work with you.”

Staying on the subject of relationships — this time with principals — one rep described what he has recently done when it comes to solidifying the relationships he has with his principals. “In an effort to strengthen relationships with the manufacturers that we serve and to ensure there’s a strong synergy among the principals that we work with, we’ve implemented a plan whereby during the course of a team meeting, which I emceed, I had several of my principals participate and share with others the products and services that they provide. The whole experience was very rewarding. They all learned about each other and even determined that there were some products they could purchase from each other. This is something I hope to conduct again in the future.”

Communication Problems

Another subject that was addressed by the participant in the MANAchat was that of difficulties that have been arising when reps attempt to communicate (via email) with customers. This topic was introduced when one rep related, “We cover the mid-Atlantic region and have close to 15,000 organic contacts in the system. That’s the result of expending a lot of shoe leather. We’re hardly digital people, but we do use that information for our heavy marketing efforts. The problem occurs, however, in that it’s becoming more and more of a challenge to get our messages through to many of our customers in the larger companies. They are having their IT filters block our efforts to communicate. Obviously, this is aimed at controlling spam, but we’re getting caught in the same fishnet. My question is are other reps facing the same problem?”

Admitting he was and agreeing that this is a growing problem, a second rep explained his view, “We’re going to be dealing with this in addition to the increased use of artificial intelligence, and other challenges. These are all going to combine to make our lives more difficult. The problem today is that individuals’ email boxes are going to become more crowded than ever. As a result, we’re being faced with the challenge of being able to cut through the noise. I don’t email a ‘bazillion’ people a day. I don’t shotgun blast but when I do send out a message, the challenge is there. Let me give you an example. The last time I sent something out I targeted 722 contacts, and only 193 of my messages got delivered. Everything else got bounced or was hit with a spam filter. These creative spam filters are telling me that ‘We don’t want you in.’ So far, I haven’t found out what the way around is.”

Compounding this issue was the experience of another rep involved with the military and aerospace industries. “We’re finding that there’s more attention being paid to cyber security. Customers simply don’t want to be faced with the prospect of any viruses being able to enter their systems. Because of the various cyber requirements and security controls, I’m beginning to think I should spend less of my time in these areas. The requirements needed to achieve compliance are too time-consuming and expensive. I simply don’t want to spend the time and money. I’m 62 years old and not sure I want to deal with this. There are 25-year-olds out there and I’m sure it’s not a shock to them, but I wonder what the outlook is for us in the future.”

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