When there’s been a strain in the relationship between principal and rep, the cause of any friction may often be traced to a failure in communication. That’s the view of one manufacturer who noted, “I can’t count the number of times I’ve heard my fellow manufacturers say their reps claim they didn’t know what the manufacturer wanted out of the relationship.”

He explained, “I’d maintain it always comes down to keeping open the lines of communication. And to accomplish that goal, what has to be done? I’d maintain that it’s not all that difficult; but it does take some time and effort.

“In my opinion, here are some things to keep in mind:

• “Make sure you tell the rep what your vision is for the future of your company. If the rep knows where you are, where you’re going in the future, he can then use that information to craft his own plans for his own business. Sharing this type of information also highlights any disconnects that may need to be discussed.”
• “Detail your short-term business and product plans for the rep. Considering the former, remember that this is the tactical portion of your business plan and includes sales growth expectations. Don’t spring any surprises on the rep. Let the agency know what you expect to happen with pricing and whether you expect any supply constraints with some products.

“When it comes to product plans, let the rep know how your plans might impact their selling efforts. Are there any new products in the pipeline? Will you have to change a product as the result of regulations?”

• “Be sure to explain your marketing plans in detail. List your trade show activity, advertising schedules and press release plans.”

While the principal should be expected to communicate various activities to its reps, there should be a bit of a quid pro quo in the relationship. This manufacturer maintains if the principal is willing to share all — and more — of the above, it’s perfectly logical for him to expect the rep to be forthcoming with certain information, for instance:

• Agency business plan — “The rep owner should be more than willing to let his manufacturer know what his business plans are and how they could affect the product line.”
• Personnel changes — “Are there any changes planned when it comes to agency personnel? If new hires are planned, can the principal assist with training? Keep in mind that the rep agency employees are not employees of the manufacturer, but be quick to offer assistance when it comes to acclimating them to your line.”
• Plans for the territory — “Are the sales territories for your reps changing? Is the agency territory changing as the result of other product lines it represents?”
• Emotional favorites — “Where and how does your product line rank with the agency’s other product lines? Are there any obvious lines that appear to be the rep’s ‘emotional favorites?’” What are your chances to climb the ladder to become one of the agency’s favorites? These and other bits of information should be made available so the principal can evaluate the rep’s level of commitment to the relationship.”

The manufacturer concluded by noting, “The greatest challenge the rep faces when dealing with manufacturers is unrealistic expectations, especially if the manufacturer has not done their homework regarding their target markets, customers and competition. That’s why it’s so important to have and to keep open the lines of communication between principal and rep.”

Reps’ Value Proposition

In a candid conversation with Agency Sales, the national sales manager of an East Coast-based manufacturer offered her take on the reps’ value proposition. According to the manufacturer, “After years of working successfully with a rep network, I’ve learned even more how valuable independent reps are for a manufacturer. The rep brings value to the manufacturer’s table. The rep has the sales organization in place in the territory that the manufacturer doesn’t have to create for himself. On top of that, perhaps the most valuable asset the rep has to offer are the relationships in the field.

“Then there’s all the overhead the manufacturer doesn’t have to pay for. The rep is responsible for his own travel, entertainment, meals, insurance, and other related (expenses). That’s all paid for by the commission checks we pay the rep.”

She continued, “We’re not even talking about the selling opportunities that are presented to the rep that normally wouldn’t be there for the direct salesperson.”

With all those positives firmly established, she was quick to note that working with reps isn’t without challenges, the largest of which is to become the rep’s emotional favorite and to encourage them to continue to grow the business as much as they can.

Staying on that “emotional favorite” subject, she added, “If there’s loyalty on both ends of the relationship, you can accomplish your goals. You instill a sense of loyalty by saying what you’re going to do, and doing what you say. Once a rep sees that, they’ll respond. An integral part of achieving that loyalty can come with the existence of written contracts, spelling out exactly what is expected of each party.”

Finding the Right Fit

Ensuring a continuously good fit between principal and rep is not necessarily an easy task, according to one manufacturer. “That’s something I’ve worked on from day one on this job and continue to this day.” He continues that when he joined his company more than a decade ago, “One of the first things I did was to hit the road and talk to our reps. I took a list of questions with me with the goal of learning what reps thought of our operation.”

He notes that his first two questions of his reps were: “What do we do correctly?” and “Where do we need improvement?”

Understandably, the answers to those questions included familiar responses such as paying commissions on time and accurately, providing quality products, delivering product on time, and responding promptly when reps seek information. “It was when I got to my last question, however, that a light bulb went on in my head. When I asked one of our Midwest reps what we could do for him that would allow him to make more money, the simple and somewhat unexpected answer was ‘Make it easy.’

“That’s really a simple answer to a simple question, but it makes sense — doesn’t it? Isn’t it a little like a nurse in an operating room? When the surgeon asks for a scalpel, she gives it to him and then gets out of the way. So too is it with us and our reps. Our job is to welcome their feedback, eliminate communication barriers, facilitate the process and generally stay out of the way. We’ve done everything we can to take that advice to heart.”

In a perfect world this type of thinking is great, but the perfect world wouldn’t exist if this manufacturer didn’t have the right reps working with them in the field. And that’s something this manufacturer remains adamant about. “Since I took on the position of national sales manager 11 years ago, I brought on five agencies, of which we’re still working with three. Right now I’m in the process of locating additional reps to conduct business with. In order to accomplish that goal, I am constantly refining my search tools, which include not only my own database but our company’s long-standing membership in MANA.”

Proactivity Leads to Teamwork

An industry consultant recently offered his take on how manufacturers can craft an effective working relationship with their outsourced sales force. According to the consultant, “Some principals take that first step into the trenches with reps completely unaware that they’ve got to be proactive in all their interactions with them.”

Defining what being proactive means, he said, “Before a principal even approaches a rep he must have well-defined goals and objectives. He’s got to be an excellent communicator and respond promptly with accurate and timely answers to questions and inquiries. In other words, he’s got to think and plan for that which he is about to do.

“The principal’s goal in working with reps should be to do things that will help reps work with you. By definition, at the end of the day our goal is to get an order. There will be no order, however, if and until a customer has been satisfied.”

In creating that satisfied customer, the principal and his rep must work together as a team, according to the consultant. “The concept of proactivity for the principal enters the game when he decides what he’s going to do to make the selling process as efficient and effective as possible. I stress this because when it comes to being proactive, we’ve got to differentiate ourselves from the old ways of conducting business. That means the principal has to be the initiator when it comes to eliminating obstructive activities, busy work, and anything resulting in waste in the channel. That means studying anything and everything that may not contribute to getting the order at the end of the day.”

Zeroing in on the concept of proactivity, he continued, “I’d like to think that we’re all agreed that in order for the principal to be proactive, he must know what’s going on in the territory. Is the rep reaching out to the principal and is the principal reacting? What I hope I’ve described is quite different from regular sales call reports that no one cares about and no one reads. What I’m stressing here is the need for timely, honest and worthwhile communication that will lead to proactively meeting customers’ expectations.”

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