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If you are new in the sales representative business and a principal offers you a territory with an established customer base for which commissions will be paid, do you take it without question? If you are a manufacturer who has decided to market new products via sales representatives, do you engage the first reputable sales representative to come across your desk? Should you look before you leap, or do you fear that if you hesitate the opportunity will wane?

Aesop’s “look before you leap” bedtime story tells about a thirsty fox who saw a big well nearby and peeped into it. The fox slipped and fell into the well. He tried to come out, but he could not do so. After some time, there came a goat who was also thirsty. He too peeped into the well. The fox saw the goat and said from inside the well, “The water is very sweet. Come on in to enjoy.”

The foolish goat jumped into the well. The fox climbed on the back of the goat and jumped out of the well. Aesop’s tale translates to the business world as well. Representatives and principals alike should attempt to assure that everything is aligned before doing something important which cannot be reverted. Calculate the possible consequences before taking action, and imagine the likely effect before taking a crucial direction.

On the other hand, there is the saying of “he who hesitates is lost” which may be traced back to biblical times. Through proverbial modernization over time, the sentiment has been translated to the business world as well — that being, it is important to make decisions quickly, acting swiftly and decisively leads to success, and those who fail to take quick, decisive action will miss a good opportunity.

I have heard too many horror stories of legal counsel in other industries who take on a client merely because the client pays the initial retainer, and then the lawyer later loses interest, citing that he or she did not get the full detailed story from their client. At that point, there may be documentation contrary to the client’s position or ancillary facts not initially expressed that lead to unnecessary and unwanted surprises. On the other hand, the client may have thought he or she had more than adequately explained their position and had hired, and paid for, a bulldog of an attorney who would fight for him or her no matter what. Each side became disappointed with the other and it would not have happened if there had been a deeper dive into the circumstances, documents, facts, and law before the engagement, or to put it another way, if they had “looked before they leaped.”

On the flip side of the coin, a client who hesitates in developing a relationship with counsel, or vice versa may well be lost. After all, who wants to spend their productive time talking to a lawyer? But if one hesitates, over time, memories may lapse, documents or witnesses may disappear, or time periods for formally addressing concerns may expire and be forever gone. Undue delay may result in legal theories such as waiver or laches. Uncounseled acts or words that are initially intended as inconsequential may result in dire consequences. If you hesitate, your case may be lost.

MANA publishes on its website a list of members who are attorneys and are knowledgeable about the representative-principal business. MANA asks attorneys from this list to offer an annual free half-hour consultation so MANA members can get a quick answer to a general legal question. While a short half hour is not sufficient to get detailed legal advice or even a contract review, it can be a start. All of the MANA member attorneys that I know are glad to accommodate MANA members for such a consultation. In my practice, I find it worthwhile to spend extra time up front on a matter before formally engaging the client. That works best for both the attorney and the client.

Sales reps and manufacturing principals should apply these idioms in their respective business relationships with each other and sprinkle in a little “ounce of prevention” as it will be “worth a pound of cure.” I once had a business executive tell me that “you can’t trust someone until you get drunk with them at least once.”

In fact, I have found just the opposite to be true, but I got his point. A good principal-representative relationship is built on trust, and that does not come in one night out on the town.

One way to develop this mutual trust is for the representative and principal to spend time together reviewing the contractual relationship. “He who hesitates” here does not ring true. A relationship should not be cemented by hastily signing a party’s “standard” contract form without review or question. Further, there is no “standard” contract. To demand unquestioned commitment to a contract signals lack of flexibility and a disrespect for initiative. To sign an unquestioned contract does not necessarily signal commitment, but more than likely may be interpreted as indifference or weakness. No attorney can write the perfect contract, and the parties would be well advised to spend time together going through each page, paragraph, sentence, and word discussing each other’s intentions to come up with a document that — while not perfect — will be understood by both. This exercise will strengthen the relationship and generate trust. “Look before you leap.”

Back to the initial questions, if you are new in the sales representative business and a principal offers you a territory with an established customer base for which commissions will be paid, do you take it without question? If you do, you are doing a disservice to the principal as well as yourself. The temptation of quickly seizing the low-hanging fruit does more harm to the expectancy and will damage a relationship. What if the product is not reputable? What if the product does not complement the other lines that you anticipate? Will this build a long-term relationship?

If you are a manufacturer who has decided to market new products via sales representatives, do you engage the first reputable sales representative to come across your desk? What if the territory being assigned by you as a manufacturer does not match the territories of the representative’s other lines? What if the representative is in a completely different industry and knows nothing about your product or the advantages and disadvantages of your product over your competitors? What if he represents competing products?

Whether the relationship is one of attorney-client or one of sales representative-principal, finding the mutual comfort zone between “look before you leap” and “he who hesitates is lost” is imperative.

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