“I think I know what I’m supposed to ask a rep before we begin working together, but am I missing something?”

That was the opening question a manufacturer asked at the beginning of a panel discussion on how manufacturers and reps can better work together. He knew he was on solid ground with the rep when he asked about:

• Management and personnel.
• The agency’s history and tenure in the territory and markets served.
• Other product lines they represented.
• Where he would fit and how much time he could expect from the rep.

But, he wondered if there was anything else important that he ought to be considering.

Two of the other manufacturers on the panel were quick to jump in with their suggestions about areas they’ve found to be important:

• “If we’re going to take the step to partner in a territory, we’re not doing it for the short term. As a result, we want to know what the agency management and personnel are planning and thinking about the future. Having said that, I want to know what their business plan is, and if they have a succession plan. Not only do I want to know if they have plans for the future, I want them to share those plans with me. If the answer is ‘No,’ or they’re reluctant to share those plans with me, then that’s a red flag. We take great pride in the partnerships we’ve established with our outsourced sales force. We’re not willing to jeopardize that by making a wrong decision. We want our reps to be the top professionals in their field. Two leading indicators as to whether they meet that criterion are whether they have business and succession plans.”
• “We know there are many other important considerations (e.g., does the rep have a warehouse, do they buy/resell, etc.) and we know this may not be as important to others as it is for us, but has the rep ever had any experience serving on a rep council? I mention this because we’ve had great luck with our rep council. We’ve grown to expect objective, creative and innovative thinking from our reps. So, if the rep is a believer in rep councils and even has had some experience serving on them, then that’s a plus in our book.”

Sales Meeting “Red Flags”

For several years now one manufacturer begins his annual sales meeting with reps by alerting them to what he considers the “red flags” that alert him to the fact that his meetings are going nowhere. By raising the flag, the manufacturer alerts everyone to be on their guard to make every effort to steer participants away from wasting time. Among those red flags are:

• The person conducting the meeting is poorly or unprepared.
• Individuals participating in the meetings — both manufacturers and reps — arrive at meetings later and later each time. When they do arrive, they’re unprepared to participate in a meaningful way.
• There is a lot of interrupting of conversations with a lot of cross-talking.
• Only a few attendees actually participate. Everyone else sits there quietly.
• Agreed-upon projects are never completed, and when the meeting ends there no clear-cut agreement concerning who will do what, by when. There is no accountability.

In conclusion he noted that beginning the meetings this way “goes a long way toward forestalling totally unproductive meetings. It reminds me a little bit of the opening scene from that movie Ferris Bueller’s Day Off. There’s an economics teacher droning on and on about the subject matter, and the students are so bored that one of them is actually fast asleep with his head on the desk and drool is coming out of his mouth. That’s the last thing that I want to happen in one of our meetings. My time and my reps’ time — especially since they’re out of their territory — is much too valuable to be spent sitting around getting nothing done.”

Saying Goodbye to the Few Remaining Dinosaurs

The subject of dinosaurs came up at an industry meeting of manufacturers and reps earlier this year. The context of the conversation was that the dinosaur rep is the one who hasn’t given up his old ways of conducting business. For instance, he’s the rep that only follows up on manufacturers’ leads and doesn’t do much to develop his own. Or, he’s the one that’s married to the idea that all it takes to cover the territory is to “show up and take orders.”

One manufacturer was quick to point to the reps that he works with as prime examples of those who have divorced themselves from the way reps used to do business and instead:

• Employ a solutions-providing systems-sell approach to their customers.
• Show themselves as experts in not only using the latest technology but also in staying on top of technological developments that conceivably will impact their businesses.
• They work overtime to enhance not only their relations with customers, but also with their principals. They cultivate and treat their principals with as much care and respect as they do their customers.

Working With Two-Way Communication

Discussions concerning how frequent and how much communication should be sent from reps to their principals never goes away. But another side of that discussion was addressed recently by one manufacturer who offered, “Sure, we want input from our reps on a regular basis, but we’re firm believers in communication being a two-way street. As a result, in addition to making sure we pay our reps accurately and on time all the time, we’ve also put into place a plan whereby we keep them fully informed concerning everything that’s happening with us. For instance, we’ve never had a complaint regarding our reps being surprised when it comes to new products and promotions. Even before we alert the trade press, our reps know what’s coming down the road.

On top of that, even without them asking, they’re the recipients of all the tools they need to be successful. That includes everything from brochures, catalogs, announcements, price lists, samples, whatever it takes. Then there is the full complement of training programs, joint sales calls, factory visits and sales meetings. But more important than just conducting all of these events, we alert our reps well in advance as to when they are going to be scheduled. That allows them the maximum amount of time so they can adjust their schedules accordingly.”

Finally, he added, “We’re proactive when we provide reps with feedback. We return their calls immediately, expedite orders and provide them with constant access to all of our factory and management personnel.”

The manufacturer concluded by noting that his company has been using reps for more than two decades, and, “By using this two-way form of communication and complementing it with an active rep council, we enjoy the best relationships you could imagine with a sales force that is not made up of direct employees.”

Similar Companies Attract Each Other

We know the adage is that “opposites attract,” but that wasn’t the case when one manufacturer explained to us how and why he chose to work with one manufacturers’ representative agency. “What caught my eye with this one rep firm was the fact that they were attracting manufacturers that were pretty much the mirror image of themselves. The rep firm in question was fairly new and owned by two people in their early 40s. Obviously they’re a small agency manned by two people who didn’t have as much industry experience as many of their competitors. What they had done — successfully — was to attract the attention of relatively small manufacturers who were fairly new to the industry and the territory. Their approach was obviously working, given their impact in the marketplace and their increased share of business. When we approached them, we were impressed by their ability to turn on a dime when it came to making a decision. Plus, given the fact most of our people were fairly young, we found an immediate connection there.”

The bottom line, however, is how this marriage has worked. According to the manufacturer, “Their enthusiasm and aggressiveness have never been better. They’ve taken us places in this market that we could have never gone with someone else.”

Benefits in Sharing the Burden

Following the first couple of sessions of the MANA webinar devoted to starting a rep agency, one manufacturer expressed a bit of surprise when one of the reps he was working with raised the subject of “shared territory development cost.” According to the manufacturer, “When we were about to begin our relationship, I was pretty confident that the contract I offered him would be readily accepted. It was a fairly standard contract that most of our reps found more than workable. This rep, however, alerted us to the fact that one of the things that was emphasized in the webinar was the rep’s need to have some sort of financial support to develop a new territory, devote more time to our line than some others, and to take our new products to market where we previously didn’t have any business.”

Giving himself a bit of a pat on the back, the manufacturer offered, “We showed a willingness to listen to what he had to say, and I’ve got to admit he had a compelling argument. We made some fairly minor adjustments to the contract, but more important than that, we found that we got a very satisfied rep in return — one who’s doing a heck of a job for us in a territory in which we previously had very little business.”