Thank You Cincinnati!

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One of my first trips to speak to manufacturers’ representatives after becoming MANA’s CEO in 2011 was to speak to the Manufacturers’ Agents of Cincinnati (MAC). It’s been a regular stop for me ever since, and it was a thrill on my most recent visit to find 35 manufacturers’ agents and manufacturers registered to take part in a “PowerPoint-Free Zone.”

Manufacturers’ Agents of Cincinnati (MAC)

The “PowerPoint-Free Zone” at the Manufacturers’ Agents of Cincinnati (MAC) meeting.

The “PowerPoint-Free Zone” has become one of MANA’s most popular presentation formats, and its heritage goes back to my first MAC visit six years ago. It was common practice then, and remains common practice today, to pick a topic, prepare a slide deck, launch a speech, and hope that the audience that had arrived to receive it was the right audience for the message you had prepared.

It’s the public speaking equivalent of broadcasting: Crafting a message for the audience you hope to attract, and trusting the pull of that message to attract that target audience at the time and place it will be delivered.

Over the years, two things became apparent.

1. PowerPoint overload at work left audiences with little tolerance for PowerPoint outside of work.

2. Q&A after the PowerPoint was often much more dynamic and powerful than the presentation that preceded it.

With this in mind, MANA’s “PowerPoint-Free Zone” was born.

Instead of MANA picking a topic and hoping it would resonate with the audience, we launch each “PowerPoint-Free Zone” presentation with 15 minutes on a topic chosen to elicit questions and vigorous discussion, and then open the floor for Q&A.

photo of Tom Hayward

Special thanks to MANA Past Chairperson Tom Hayward for his regular outreach to get me onto MAC’s speaker agenda once again.

The audience decides what they want to discuss, and we discuss it. Vigorously. Productively. No holds barred.

Instead of broadcasting, it’s narrowcasting. Instead of our chosen topics, it’s the audience’s chosen topics. And some of the best insights are shared not by the presenter, but by members of the audience.

It’s not unlike the advice we get from sales trainers, applied to audiences instead of prospective customers. Instead of telling prospective customers everything you know, according to most sales trainers, find out what they are interested in, listen more than you talk, and help them find useful solutions. Sage advice for salespeople and MANA presenters!

Making the Short List

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Getting “found” by manufacturers who need representation. It’s one of the benefits of membership that MANA representative members mention most.

But getting from being found to earning an interview takes time and savvy. So how do you make it from the manufacturer’s long “these firms might be possibilities” list to the short “we need to interview these firms” list?

When a manufacturer searches MANA’s RepFinder database, he or she might find five potential representative firms — or 100. When the list is long, how do manufacturers decide who makes it from the long list to the short list?

Some manufacturers have shared ways they narrow down their long list. If you could put those manufacturers in a conference room, the discussion might sound like this:

“It’s interesting,” noted Sam. “Usually I have no problem finding enough reps in the RepFinder, but sometimes I find too many. When I start with a really long list, I have some rules of thumb I use to shorten the list.

“The first thing I do,” Sam continued, “is look at their websites and see if their other lines are complementary to our product. Reps that don’t have a website are the first ones I cut from my list.”

“My rules of thumb include how they use e-mail addresses,” said Cindy. “Now, remember that when I hire a representative, I am usually placing several million dollars with that firm,” she added, “so I feel I have the right to be extra picky.

“One of my pet peeves is representatives whose MANA profile doesn’t have an actual person’s e-mail address. They just have sales@repcompany.com or info@
repcompany.com. When I send an e-mail, I want to know who I’m sending it to, so firms with generic addresses get the boot.

“And the same goes for firms that won’t invest $40 per year to have an e-mail address that matches their web domain,” Cindy continued. “They may be hanging onto their AOL account or Gmail account for a variety of good reasons, but if they don’t have an e-mail address like fsmith@repcompany.com, to me that’s a red flag.”

“Interesting that you mentioned red flags,” added Jim. “When I see a rep profile where the entire profile is in lower case, or has spelling errors, or lists their phone as 3125551212 instead of (312) 555-1212, that firm doesn’t make it to the short list.”

Are these rules arbitrary? Are they unfair? Perhaps. But since the cost to make these fixes ranges from free to $40, why not update your MANA member profile today to help your representative firm make it from the long list to the short list?

Welcome to the Rock!

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A manufacturers’ representative walked into the gift shop of the former United States Penitentiary at Alcatraz. Among the various souvenirs offered for sale, he came across a copy of the Institution Rules & Regulations issued to each new inmate, written by Warden Paul J. Madigan.

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© Dima_Rogozhin | stock.adobe.com

Leafing through the facsimile of the original 19-page mimeographed pamphlet, he paused to read Rule Five, titled “Privileges,” which states: “You are entitled to food, clothing, shelter, and medical attention. Anything else that you get is a privilege. You earn your privileges by conducting yourself properly.”

“Sweet deal,” he murmured quietly to himself, softly enough so the other tourists couldn’t hear him speak. “In manufacturers’ representative agreements you aren’t entitled to anything, and you have to earn everything.”

That manufacturers’ representative summed up the reason that MANA members are really the entrepreneurs’ entrepreneurs. Because this is the group that heard the offer, “Who only wants to eat what they kill themselves?” and swiftly, confidently replied: “Sign me up for that deal! I will do better looking after myself than I would ever do working for somebody else and expecting them to look after me!”

Which is why it is such an honor and a pleasure to be CEO of an association built around that special breed of entrepreneurs and the companies that use those entrepreneurs who take their products to market.

There is one more reason that it’s such a privilege to be the CEO of MANA. It’s because our industry is so welcoming to industrious individuals who are determined to build a business but have little more than just their own individual drive, ambition and perseverance to make it happen.

Unlike other more capital-intensive businesses, a successful manufacturers’ representative firm can be built with just a strong work ethic, a serviceable car, a cell phone, a laptop, business cards, and just enough savings to squeak by and pay expenses during the first year while the new firm builds its book of business.

The best predictor of which firms will succeed is how hard the founder works and how lucky the founder is. And the harder the founder works, the luckier the founder seems to be!

What a pleasure it is to be surrounded by entrepreneurs who at some point in their lives just said, “I can do this.” And then they did.

It’s rarely easy, but it’s almost always rewarding. Because when it comes to manufacturers’ representatives (with apologies to Dr. Robert H. Schuller for paraphrasing the title of his book): Tough times never last, but tough manufacturers’ representative firms do.

Race to Quality

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Thank you Chicago!

A record 43 paid attendees turned out for my 2017 manufacturers’ representative business forecast at a joint MANA/ERA breakfast meeting, about double the average turnout.

MANA CEO Charles Cohon’s Chicago forecast for the representative business in 2017

An overflow crowd sent restaurant staff scrambling for extra chairs at MANA CEO Charles Cohon’s Chicago forecast for the representative business in 2017.

My forecast: 2017 will be a great year for manufacturers’ representatives. And it will also be a terrible year.

Let me explain.

As CEO of MANA I get a lot of calls from reps and from manufacturers who sell through manufacturers’ representatives. And the single most consistent message I get for 2017 is that when it comes to selling through manufacturers’ representatives, more and more manufacturers have begun to participate in a Race to Quality.

What do I mean by a Race to Quality?

Back in the day, often all you had to do to keep a line was to keep sales up and “don’t do anything wrong.”

Today many manufacturers are starting to set the bar higher. “Not doing anything wrong” is not going to be good enough to keep their lines, they say. Instead, they are looking for manufacturers’ representatives who routinely ask themselves, “What more can I do for my principals?”

For representative firms that constantly enhance and expand their services, this Race to Quality will make 2017 a very good year. They will be hotly pursued by excellent principals who have decided to recruit “Best of Class” representative firms in every territory of their rep network.

For representative firms where managers work only in their business but not on their business, 2017 will be a bad year. The Race to Quality will cost them lines as principals impatient with the status quo recruit replacements for representative firms that have a “this is how we’ve always done it” attitude.

Or, to borrow a metaphor from Wayne Gretzky, 2017 will not be a great year for representative firms who skate to the puck, but it will be a terrific year for reps who can figure out how to skate to where the puck is going to be.

Editor’s Note: If you missed Charley’s presentation you can listen to it as a podcast — your March iToolbox newsletter will include the link.

Blast From the Past

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70_anniversary_logoIn this issue, we continue our celebration of MANA’s 70th anniversary year with another “Blast From the Past” from MANA’s early years.

From the first issue of The Agent and Representative magazine in July 1949 (which eventually became Agency Sales magazine) we share the story of Bill Herendon.

It’s a story that could just as easily have been written last month as 68 years ago, except that now many manufacturers have joined MANA, have stronger relationships with their representatives, and would not be so easily misled by the ploy that ended Herendon’s relationship with his principal.

And now, read the article from the very first magazine ever published by MANA.


The Story of BILL HERENDON
By Paul Edouard

(Reprinted from July 1949 The AGENT and Representative magazine)

EDITOR’S NOTE: The author was a young 3-minute speaker in World War II, and is now a 3-minute business-story writer, each story with a moral. Names and places mentioned are fictional, and any similarity to persons living or dead is purely accidental.

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© lukeruk, © VITAMIN | stock.adobe.com

His name was Herendon — Bill Herendon. If you’ll look in the phone book, you’ll not likely find a Herendon there, although there probably is a Bill Herendon in every large city in the United States. Only, in the phone books, they go by their right names.

Sitting next to me there in the grill, I could see that Bill was a square-shouldered, square-jawed individual, with plenty of turkey-foot lines fanning back from a pair of friendly, if now sad, blue eyes. I signaled the waiter, this time including Bill. Over his objections, I asked his profession.

Bill was a manufacturers’ agent, or had been for many years. As a hobby, he learned to fly, and in good weather covered his territory that way. When he washed out “Jenny” in an Arizona flash storm, he joined the Air Reserve for “free time” to hold his license. Then, one day — BANG! — and he was in the Navy.

That little tour of duty is another story — and I’ll bet interesting! I’m hoping Bill will tell me something about it some time.

VE and VJ days arriving, Bill finally came back home; hung out the old shingle again. But it was a bit tough. He had had to release the old accounts, of course, and getting them back was something else again — what with liquidation and retirement, war conversion to unsuited items, and just plain scarcity of raw and finished materials.

But by playing hop-scotch, so to speak, Bill kept going for a year; and then, as goods started rolling along, began rebuilding his business and his accounts in dead earnest.

“Worked mighty hard,” he told me, over his old-fashioned, “building up strong jobber connections for two Eastern lines. Sometimes, to get a jobber I wanted the factory to have,” he said, “I went pretty far in giving exclusives.”

Oh yes, Bill knew all about “eggs all in one basket,” but trusted, and took the chance. Didn’t even have formal contracts with his two principals. “Never had a written contract in my life,” he said. “No one ever mistrusted Bill Herendon.”

At the end of the second year, Bill was going great guns, back in the old stride — new office, smart secretary, salesmen in training — doing a bang-up job for all concerned.

“Then, one day,” and he looked at me with bewilderment still in his eyes, “things began to happen to me.”

At the new municipal airport, the manager of Bill’s biggest and best account weighed in his bags for the East. “Yes, on time,” said the attendant, and passed him through.

In a matter of hours the DC-6 set him down in the northern end of the Buckeye State. The next morning he was at the desk of the president of one of Ohio’s up and coming manufacturing concerns.

“Glad to meet the manager of one of our best jobbing accounts,” smiled the president. “How’s Bill Herendon? ”

“Herendon? … Oh, all right, I guess … last time I saw him,” parried the jobber.

“Last time you saw him? … I don’t understand,” said the president.

“Well, frankly, that’s why I’m here,” answered the jobber, as though it hurt him to say it more than it was going to hurt Bill. “It just doesn’t seem fair that we invest the money — you and I — promote and sell the goods, and Herendon pirates a nice fat commission out of your hard-earned profits — and mine!”

There ensued a half hour of spirited conversation, the president trying to build Bill up and the jobber slowly tearing him down.

“Anyway,” said the president, rising, “there’s nothing I can do about it. We have a contract with Herendon, and we live up to our contracts.”

The phone rang. “Yes, Miss Jones, I’m taking that plane. Wire Boston. And, Miss Jones, send in my sales manager, please.”

The president offered apologies, introduced his new sales manager, and was gone.

With a clear field, the jobber started working on the new sales manager — but systematically! By the second day, it was established beyond doubt that there was no contract in existence with Bill Herendon. Merely a brief exchange of letters, mentioning the commission rate orally agreed upon for business in the new territory, obtained by Bill and approved by the company. Nothing more binding; nothing legal at all.

All the jobber wanted was an “advertising allowance,” less than Herendon’s commission. “And that advertising, placed by us right at the spot, will be worth far more than anything Herendon could possibly do, even if he worked conscientiously at his job, which he certainly isn’t,” concluded the jobber’s manager.

The new sales manager was impressed — impressed with the possibilities in the suggestion, and with his own newly acquired authority. After all, hadn’t the president said he was to be the undisputed boss of sales? Why have to compete with Herendon?

So, the deal was concluded, the jobber leaving a big, fat order for goods hard to get anywhere, at any price; and, satisfied, flew back from whence he came.

In Boston, the president wasn’t feeling so well; decided to run on up to Maine for a much needed rest; wired his sales manager, “Place you in complete charge. Will be away at least a month.”

That did it!

One by one the sales manager took over Bill’s jobbers, flying them in to Cleveland and passing out the advertising allowances. “For the present, just say nothing to Herendon. You understand? That’s all I ask,” cautioned the sales manager. “In due course, I’ll be out to see you, and we’ll play some more golf, and have fun!”

Each jobber inwardly smiled over the cash gain through the old advertising dodge, secretly felt sorry for good old Bill — but then … well, that was Bill’s problem.

It was two months before Bill actually learned the truth of the matter, and even then he wouldn’t believe it. He had known that business was off a bit, but still not that badly off.

The look in the eyes of his friendliest jobbers, those who really did appreciate a job well done by a factory representative — whether on salary or commission — made Bill call Cleveland the moment he could get back to his office.

“Then I consulted a lawyer,” Bill told me, sadly.

“What, no contract, Mr. Herendon? … I’m afraid you haven’t a leg to stand on,” said the attorney, with complete finality.

And that about sums up the story of Bill Herendon, at least for the present. The pins had really been knocked out from under him. The war had made him a bit reckless perhaps, measured by commercial standards. The unquestioned loyalty of his flying pals was a thing taken for granted. This peace-time stuff he couldn’t quite bring himself to understand again.

“Why should anyone want to do a thing like that to me?” Bill asked.

“What are you doing now. Bill?” I ventured, as Bill signaled the waiter.

“Well, not much of anything,” he replied. “I go to the hospital once a week; nerves they say, but I’m getting better.” Without Bill noticing, I picked up the tab … and said good night. At the desk, the club’s cashier told me that Bill came there about once a week. Seemed lonely, and melancholy.

Thoughtfully, I said, “Too bad,” and slowly went my way.

MORAL (by John Dryden): “Bold knaves thrive, without one grain of sense; but good men starve for want of impudence.”

70th MANAversary

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The year was 1947. Harry S. Truman was president, the World Series was televised for the first time (the New York Yankees beat the Brooklyn Dodgers in seven games), Chuck Yeager broke the sound barrier, and on October 17, 1947, the Manufacturers’ Agents National Association joined the community of not-for-profit trade associations.

Fast forward to July 1949, and MANA members discovered the first, 24-page issue of The Agent and Representative magazine (eventually renamed Agency Sales) in their mailboxes.

Digging through the first few issues of The Agent and Representative reveals how much MANA has changed, and also how much it has remained the same.

In those first few issues we find sentences like: “I know it’s customary for men who call themselves and believe themselves to be ‘practical men’ to pooh-pooh anything savoring of academic classification in salesmanship.” No thought of women as salespeople or as customers in those earliest editions. But in today’s MANA, woman-owned firms are common and the first woman to join MANA’s Board of Directors does so in May 2017.

Another glaring change since 1949 is that, although manufacturers were invited to advertise in our magazine, the articles in that 1949 issue focus solely on the needs of manufacturers’ representatives. Today Agency Sales strives to be relevant to both manufacturers and manufacturers’ representatives and includes articles for both audiences. And, also for the first time, a manufacturer will join MANA’s Board of Directors in May 2017.

Those are things that have changed, and changed for the better. Yet, some articles from those early issues could be reprinted today and most readers would have no hint that they were written in 1949. In the very first issue of The Agent and Representative is the story of Bill Herendon, a manufacturers’ representative whose customers pressured his principals to fire Bill and cut the price by the amount of Bill’s commissions. And how Bill, lacking a written agreement, had no recourse when the principal’s new sales manager agreed to that customer’s request.

As part of our 70th MANAversary celebration, each Agency Sales magazine from this issue through October will include a “blast from the past” from those early issues. In this issue, we share the first full page of “Agents and Representatives Wanted” advertising published in The Agent and Representative magazine, from the September 1949 issue. Next month, we’ll reprint the story of Bill Herendon.

Click on image to see full size

Click on image to see full size version.

On a personal note, it is humbling to read these early issues and realize the legacy with which MANA’s current staff and Board of Directors has been entrusted. It falls upon us not only to maintain and grow the services we provide to our members, but also to ensure that some future MANA CEO can write a similar editorial for MANA’s 100th anniversary, musing on how hard it must have been for manufacturers’ representatives in 2017 to get through traffic and make sales calls without flying cars.

Yes, There Will Always Be Reps

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Yes, the Internet has changed the role of manufacturers’ representatives. We no longer deliver boxes of catalogs into the hands of customers eagerly awaiting printed notification of our newest products, or communicate by postal letter or fax.

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Which has led some pundits to predict that Internet selling will eventually replace manufacturers’ representatives completely.

I’ve always known that those pundits were wrong, but I’ve struggled to articulate exactly why they are wrong — until now, thanks to a brief description of human psychology that I share below.

I’ve learned that people will forget what you’ve said.

No sustainable advantage in “what you’ve said” for manufacturers’ representatives over Internet selling. We’ve all met with customers and carefully described the features and limitations of our products and secured a sale — and then gotten the call after the sale complaining about the absence of a feature we never offered or the existence of a limitation that we carefully described before the purchase. Whether it is something we said, or something presented on a web page, customers forget or misremember what’s been said or posted on a web page.

I’ve learned that people will forget what you’ve said.
People will forget what you did.

Again, no sustainable advantage in “what you did” for manufacturers’ representatives over Internet selling. The memory of our in-person product demonstrations often will fade before the customer makes a buying decision, just as the memory of an online video demonstrating the product also soon fades.

I’ve learned that people will forget what you’ve said.
People will forget what you did.
But people will never forget how you made them feel.
— Maya Angelou

That is why there will always be manufacturers’ representatives. Because human beings don’t remember what you said, or what you did, but they do remember how you made them feel. A website can reproduce everything that a manufacturers’ representative could say during a sales call. And a website can offer a credible reproduction of the product demonstration a manufacturers’ representative did during a sales call.

But a website can only be a feeble imitation of person-to-person engagement when it comes to how the customer feels about a purchase. All of us have to purchase things that call for special expertise; things that we would be anxious about buying if we did not have an expert at our side. Or purchases where knowing that our business is highly valued reassures us that we will get special attention when we need it.

Manufacturers’ representatives’ roles may change, but they will always be a crucial part of commerce — because customers make buying decisions based on how they feel, and the most powerful way to impact how people feel is face-to-face.

9-1-1 Emergency

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© retrostar | stock.adobe.com

It was April 11, 2016. Something very, very bad was about to happen to manufacturers’ agents who sell to the State of California.

New legislation that would in many cases classify manufacturers’ agents as lobbyists was about to become law. California forbids lobbyists from receiving contingent compensation (such as sales commission). Once classified as lobbyists, manufacturers’ agents would be prohibited from receiving sales commission on sales to the State of California.

And the bill conveniently excluded direct sales forces from these restrictions.

The state’s procurement department knew this was a terrible idea. But where could they turn to quickly rally opposition?

They turned to the rep association that spans across all industries and markets: MANA.

In just days MANA researched the bill, interviewed California lobbyists, hired a lobbyist, and joined forces with California’s Department of Finance and Fair Political Practices Commission, which also opposed this bill.

MANA authored a formal letter of opposition, and invited MANA California members and all other rep associations to weigh in with their own letters.

Despite our best efforts, on May 3, 2016 California’s Assembly and Senate passed the bill unanimously.

Our only hope: a veto from California Governor Edmund G. Brown.

On May 3, 2016 MANA submitted a new formal letter of opposition to the Governor, and followed up with a legislative fact sheet. And again we invited MANA California members and all other rep associations to write letters of opposition.

On May 13, Governor Brown vetoed this bill, and as of this writing the California legislature has not chosen to override his veto. Just 32 days after MANA was first notified of this anti-rep legislation, the Governor was putting his signature on its veto.

Sometimes prospective MANA members ask me about the benefits of MANA membership. We usually talk about matchmaking between reps and principals, Agency Sales magazine, MANA’s educational materials, and our specimen representative agreement.

But after this experience, I will have to add one more benefit of membership. Without your support, MANA would not exist. And without MANA, when some terribly misguided anti-rep law is being considered in your state’s legislature, who would you call for help?

In some respects, MANA is like 9-1-1. You may go a long time without calling 9‑1‑1, but part of its value is the peace of mind you get from knowing you are just one phone call away for emergency services that will arrive with red lights flashing and sirens blaring.

Because of your support, we’re here when you need us. Rep emergency? Call MANA!


governors-seal

May 13, 2016

To the Members of the California State Assembly:

I am returning Assembly Bill 1200 without my signature.

This bill would revise the definition of “lobbyist” in the Political Reform Act of 1974 to include specified conduct by third-party consultants who work to influence governmental procurement.

Given that the laws regulating state procurement are voluminous and already contain ample opportunity for public scrutiny, I don’t believe this bill is necessary.

Sincerely,

Signature

Edmund G. Brown Jr.

MANA Featured in Billboard Magazine

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Yes, you can find MANA’s announcement of its new president on page 105 of Billboard magazine. In all fairness, we should note that you should not search for this article in the current issue of Billboard. You’ll need to search Billboard’s back issues for the June 19, 1948 issue, when that magazine was still The Billboard. (To view that entire The Billboard article online, use the search term: “Richard A. Wilcox” MANA.)

As printed in "The Billboard" magazine, June 19, 1948.

As printed in The Billboard magazine, June 19, 1948.

Why the sudden interest in MANA’s ancient history? Because MANA’s 70th anniversary is coming up in October 2017. And while I’ve spent my first five years as MANA’s CEO looking diligently and aggressively toward MANA’s future, our upcoming 70th anniversary has reminded me to spend a little time looking at our past.

A search of our archives has revealed the first issue of The Agent and Representative magazine, dated July 1949, so this June 1948 Billboard article is the earliest reference to MANA we’ve found in print so far. If you have something older in your files, we hope you’ll share it.

We will continue to include more and more nuggets from MANA’s past as our October 2017 anniversary approaches, but for now I’d like to close this MANA editorial with an excerpt from MANA’s very first editorial, penned for that July 1949 issue by MANA’s then Executive Secretary P. Edwin Thomas.

P. Edwin Thomas

P. Edwin Thomas

New Times, New Tasks

Rightly or wrongly, the post-war American interest is tightly linked to the welfare of half the whole world; although, even if we wished, we are not rich enough to endow the world, or powerful enough to rule it. Instead, being what we are, we can only strive to create, and work to produce, the conditions that make for freedom and peace among nations, being careful to keep ourselves solvent in the gigantic process.

But this condition, this American world interest, demands a new look at the needs of the domestic welfare of our own people, in pure terms of dollars and cents alone. For, somehow, the cost of all items, the cost of everything we need and use, must be lowered to a point within the means of each and every one of us — the means remaining after all the multifarous and multitudinous tax burdens have been borne.

Among these are the lowering of selling costs, and that is where agents and representatives come in.

More Than Just a Job

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What makes being a rep more than just a job?
Why do so many reps become professionally and emotionally attached to our industry?

Charles and Harold Cohon

Charles and Harold Cohon

I’ve been MANA’s CEO for five years and was a rep for three decades before that, but it’s only recent events that have led me to reflect deeply on questions like those.

Part of the answer is just pragmatic. Becoming a rep gives a budding entrepreneur a way to start a company with just business savvy, a robust work ethic, and enough savings to live off of while their company gets on its feet. And there is justifiable pride earned from relationships with long-term principals and customers.

But the strongest emotional attachments to our industry are probably because rep companies tend to be family businesses. Sometimes rep companies are fathers and mothers and sons and daughters, and sometimes they are just people who have become like family working together in a small business.

The trigger for my deep reflections on the powerful emotional attachment reps have to our industry was my father Harold Cohon’s recent passing.

In the days that followed, one of the memories that kept coming back over and over again was the first time Dad took me to make out-of-town sales calls.

We arrived in Rockford, Illinois, pulled into a gas station, and as I refilled the tank Dad announced, “You’d better figure out how to get to the customer.”

Dad was in the car, and he knew the directions to the customer’s office, but he also knew that the next time I went out on calls he wouldn’t be in the car. It was time to be sure that I wouldn’t be too bashful to ask for directions. The attendant pointed me in the right direction and also sold me a Rockford street guide that I carried in my car for many years.

In the car that day Dad knew that I needed to learn how to make sales calls on my own, but on my first out-of-town sales trip he gave me the gift of being my safety net. And then, over time, he gave me the even greater gift of guiding me to learn to work without a net.

Agents Benefit From Extensive Support Network

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Who supports the representative system of selling? MANA, of course, but there are probably more people in that role than you’d expect, from a wide range of industry-specific representative associations to an elite group of representative-savvy attorneys.

How do these executives discover opportunities to collaborate and learn from each other? Often it’s at a MANA-hosted meeting where those executives share the latest innovations and best practices that support the representative system of selling.

Why does MANA host this event? Because the insights from those meetings will benefit MANA representative and manufacturer members for years to come.

The first day of this recent event MANA hosted representative association executives to meet with their peers as members of the Alliance of Manufacturers’ Representative Associations (AMRA). With such a powerful group gathered together, the conversation quickly turned to ways that these associations could collaborate for their representative and manufacturer members’ benefit, enhance member services, and share educational resources.

Sharing their expertise were: Stacey Woldt, AIM/R; Patricia Collins, EMDA; Tess Hill, ERA; Bill Weiner, IHRA; Ray Wright, IPRO; Charles Cohon, MANA; Jerry Leth, MANA; Liz Beerman, MRERF; Ken Hooper, NEMRA; Susan Crolla, PTRA. (My fault that we missed taking a group photo, sorry!)

The second day of this event MANA hosted attorneys who specialize in manufacturer/representative law to meet with their counterparts from across the country as members of the MANA Attorney Forum.

MANA Attorney Forum

Two examples of how MANA provides backstage support for its agent and manufacturer members are the association’s participation in AMRA and the MANA-sponsored Attorney Forum. Participants in this years’ Attorney Forum are above, back row, left to right: Mark Smith, Adam Glazer, Matt Benson, Tom Kammerait, Barbara Kramer, John Riccione, Dan Beederman, Gerry Newman, Randy Gillary and Charles Cohon. Front row, from left: Jerry Leth, Steve Nelson, Mark Schmidt, Scott Sanders, Doug Andrews, John Anderson and John Rotaris.

What do members of the MANA Attorney Forum discuss? Yes, as you might expect, they discuss how to enforce agreements that have not been honored (almost always with principals who are not MANA members), but they spent just as much time discussing how to write fair agreements to avoid post-termination conflicts.

And there is much more to MANA Attorney Forum members than just representative agreements. The group also discussed how reps can avoid conflicts of interest, ways that alternative compensation like stock options can substitute for commission, and valuation and succession planning for representative firms.

Attorney Forum

Left to right: Doug Andrews, Steve Nelson, Steve Valentine, and John Riccione participating in an ongoing discussion at the Attorney Forum.

When executives who support the representative system of selling share their expertise, everybody wins. And MANA is a better association for having participated.

Revealing Moments

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What happens when a deer first catches the scent or sound of a hunter? The deer freezes. Why does the deer freeze? Because motion would catch the hunter’s eye and make the deer’s presence obvious. To hide in plain sight, the deer needs to be motionless.

What about things that hide in plain sight in our businesses — procedures, practices and policies that undermine our success? How do we catch sight of things that are so much a part of our daily routine that they blend into the landscape?

“Never let a good crisis go to waste,” said Winston Churchill, to which I would add, “Never let a good transition go to waste” either. Transitions are motions that make things visible that were not visible while they were motionless. Let me give you an example.

Three members of MANA’s Board of Directors recently completed their terms of service on the Board. Three new Board members took their places. Six transitions not to be wasted!

When a Board member leaves MANA, or an employee leaves your company, or when a relationship with one of your principals ends, that transition should trigger an exit interview. Exit interviews recognize that an exit is a significant transition and a one-time-only opportunity to get frank feedback from someone who might have been reluctant to be blunt while they were still part of the organization.

MANA Board member exit interviews focus on experiences on the Board which were positive and experiences which were not, and guidance for successors. In your business, when a relationship with an employee or principal ends, you can extract the last bit of value from that relationship with an exit interview that might reveal important facts about your business that might never be discovered any other way.

When a new Board member joins MANA, or an employee joins your company, or when a relationship with a new principal begins, that transition should trigger a “fresh eyes” interview. A new Board member will see things in their first Board meeting that a veteran might dismiss as routine. In your business a new employee or a new principal relationship puts “fresh eyes” on your firm and may reveal problems or opportunities that were hiding in plain sight.

Whenever something changes at MANA it gives us an opportunity to illuminate teachable moments that help us improve our services to you. We hope you will join us in never letting a good transition go to waste.

Thank You Cincinnati!

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A couple of months ago I thanked Texas MANA members for their warm welcome and hospitality when we met for lunch and conversation in Dallas. Now I have the opportunity to extend those same thanks to Ohio, Indiana and Kentucky MANA members, and members of the Manufacturers’ Agents of Cincinnati (MAC) who met me for a joint MANA/MAC lunch and conversation at the Montgomery Inn in Cincinnati.

MANA/MAC lunch

A good turnout at the joint MANA/MAC lunch.

Why were Dallas and Cincinnati some of the best meetings I’ve ever had? I think it’s because we established a “PowerPoint-Free Zone” for our meetings. No projector. No screen. Just informal questions, answers and conversation about topics important to representatives, and some friendly networking.

There are still topics best communicated with formal presentations, but it seems that there is less appetite for a classroom setting and more of an appetite for conversation. The message I’m getting is, “Talk with me, not at me.” Message received!

MAC (www.maccincinnati.org) is an association focused on representative and principal best practices much like MANA, except that, as the name suggests, it focuses its attention on the area surrounding Cincinnati.

A special treat for me during this visit was the opportunity to meet with most of MAC’s Board of Directors, MANA past Chairman Tom Hayward, and MANA Board member John Davis before the meeting. Getting together face-to-face to share ideas and best practices with other associations that share MANA’s interests is a very important part of MANA’s role in promoting the representative system of selling.

My biggest takeaway from Dallas and Cincinnati is that my role at those meetings has been to get the conversation started, and keep it on track. The combined experience of 20 or 30 representatives in the room brings more expertise to the table than any MANA CEO could bring.

So, again, thanks to Dallas and Cincinnati, and I’m looking forward to an upcoming (at press time) “PowerPoint-Free Zone” in New Jersey. Where’s next? I’m open to suggestions, e-mail me at ccohon@manaonline.org.

Left to right: Jeff Witt, John Davis, Larry Roy, Chris Schnetzer, Charlie McDonald, Dick Harvey, Tom Hayward, Rick Pierce and Charles Cohon.

Attendees at the MAC Board meeting (left to right) Jeff Witt, John Davis, Larry Roy, Chris Schnetzer, Charlie McDonald, Dick Harvey, Tom Hayward, Rick Pierce and Charles Cohon.

Rolaids™ or Rep Councils?

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Over lunch recently a MANA manufacturer member shared his experience with rep councils, and also shared an unexpected outcome from a recently assembled rep council: relief from excess stomach acid.

But I’ll let him tell the story.*

“We’ve been a big believer in rep councils for a long time, for all the usual reasons.

“Because our five rep council members collect input from all of our reps, analyze it, and then present it to us without identifying the source, nobody feels that they might jeopardize the line by pointing out our weak spots.

“But anonymity is only the first step. No one will spend time preparing that feedback unless they know that we will act on it. So, step two is prompt executive response. Our rep council’s report goes directly to our top executives and they respond within six weeks, bullet point by bullet point. Some of the bullet points are acted upon quickly, some are queued for attention later, and some may not be practical to pursue, but every bullet point gets a response.

“We get great results from our rep council, but I recently got an unexpected benefit from the rep council: relief from excess stomach acid.

“Let me explain. One of our reps who also happens to be a member of the rep council made a request we just couldn’t accommodate. When a rep requests something we just can’t do they often will ask again a second or third time, but eventually they accept the bad news and move on to other opportunities.

“But this guy was like a dog with a bone. He just wouldn’t let go. Every couple of weeks he’d push me for the same thing again, as if I could give him a different answer the 16th time he asked than I had given him the first 15 times.

“But he is a very, very effective rep, so I bit my tongue. Then at the rep council meeting he asked the other four reps serving on the council to back his request. And all four told him that his request was completely unrealistic. When I had to turn him down, it sounded to him like I was just defending my company. But when he heard it from his counterparts, it sank in. He never brought it up again. No more heartburn.

“How do you spell relief? R-E-P-C-O-U-N-C-I-L”


* I’ve recounted the substance of the manufacturer’s story, but details and phrasing have been changed.

Thank You, Dallas!

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Maybe it’s the economy. Maybe it’s the nature of the rep business. But over my five years as MANA’s CEO, every year I’ve seen less and less appetite for face-to-face education and networking from MANA members.

Until February.

When Dallas MANA members wowed me by turning out 30-strong for a “PowerPoint-Free Zone*” lunch at Dunston’s Steakhouse, where I facilitated a conversation on topics in our industry that were of interest to that particular group of MANA members.

image of Dallas meeting

MANA members gather for the “PowerPoint-Free Zone” lunch in Dallas, Texas

Thank you, Dallas MANA members, for demonstrating that there can still be exceptions to that trend and that there are still opportunities for MANA members to meet face-to-face to exchange ideas and support the representative system of selling.

At press time we’d just sent surveys to attendees to find out what kind of appetite there is for another Dallas meeting. But even if Dallas MANA members decide to meet only once or twice a year, it will still be reassuring to know that our industry, which hangs its hat on selling the value of face-to-face meetings with customers, puts its money where its mouth is and occasionally invests time in face-to-face meetings among peers.

And the same week this issue hits your mailbox, I’m facilitating another rep conversation in Cincinnati. The topics that interest attendees in Cincinnati will undoubtedly be different from the topics we discussed in Dallas, but what will be the same is that members of our industry will be sitting down together for a meal, sharing common problems and concerns, and having frank discussions about ways to solve those common issues.

Interested in bringing this conversation to your city? If you’re ready to volunteer as MANA’s “boots on the ground” to find a venue and stir up local interest, reach out to me at (877) 626-2776 or ccohon@manaonline.org.


Conversation  not Presentation

Conversation  
NOT Presentation

* What, exactly, is a “PowerPoint-Free Zone?” It means no PowerPoint allowed. No projector. No canned speech. It means conversation instead of presentation. We start with a quick scan of the topics in MANA’s 18-page “Benefits of Membership” booklet to find the topics that are of greatest interest to that particular group, and then open the floor for facilitated conversation.

I Just Lost My Big Line. What Should I Do?

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It’s a phone call I get, unfortunately, several times a year. A MANA representative member calls to say, “I know I shouldn’t have let one principal become more than half my income, but that’s just how our business grew, and now that line has terminated my firm.”

“I do have a couple of nibbles from competitive lines, but none of them comes close to replacing the commission income from the line we lost. What should I do?”

Looking back at those conversations, I’ve compiled below the suggestions those callers found most useful, both as guidance for you if you ever find yourself in this position and as a reminder to try to grow your line card in a balanced way if you can.

  • Have a rep-savvy rep attorney from MANA’s attorneys list review the agreement that was just terminated. They may discover that you are entitled to more compensation than might be obvious.
  • If your ex-principal is going direct, they may try to recruit one or more of your firm’s salespeople to become their direct salespeople. Give some advance thought to:
    • If this happens, do I care?
    • If I do care, what recourse do I have?
  • When the territory you’re taking over for your new principal has much less existing business than the territory you lost, you can ask your new principal to help you by offering:
    • A “Life of Part, Life of Program” clause, so if you design in a part, they pay you commission on that part for life, even if they terminate you as their representative.
    • An extended termination clause, perhaps adding one month of severance for each year of service.
    • A “no house accounts” policy.
    • A larger territory than you had with your prior principal.
    • A commission bump for the first year.

And probably the best advice I can give you is to call MANA to talk through your options with me or with Jerry Leth, MANA’s VP and General Manager. Having a friendly, experienced sounding board during an emotionally-charged transition may help you see some options you might have missed on your own, and give you a better chance to take the lemons you’ve been handed and make lemonade.

I Don’t Know Who You Are

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I don’t know who you are.
I don’t know your company.
I don’t know your company’s product….
Now — what was it you wanted to sell me?

McGraw-Hill Magazines
“Man in the Chair” ad, 1958

I don’t know what a rep is.
I don’t know what services you provide.
I don’t know how your firm adds value.
Now — why should we keep sending you commission checks?

Recent Business School Graduate
Just hired as a key executive at your most important principal

Why do MANA and other manufacturers’ representatives associations reach out to business schools? Because someday the graduates of those business schools will be recruited to become the regional sales managers, sales managers, sales vice-presidents, or even presidents of the companies our members represent.
What happens if those recent business school graduates show up for their first day of work without already knowing what a manufacturers’ representative is and the value we add to their companies? That manufacturing company’s representatives risk ending up as collateral damage when these uninformed executives’ learning curves include ill-advised decisions to cut commission rates, take house accounts, or move to a direct sales forces.

Who suffers when business schools graduate students who don’t understand manufacturers’ representatives? Everybody suffers!

Manufacturers’ representatives suffer when principal relationships sour and commissions fall.

Customers suffer when a manufacturer’s new policies impair customers’ ability to access the manufacturers’ representative expertise they’d come to rely upon.

Manufacturers suffer when disgruntled customers defect to new suppliers.

That’s why I spoke at Harvard Business School in October, at Columbia Business School in April, and maintain close ties to the University of Chicago Booth School of Business’ Entrepreneurial Selling course. (Video of the Harvard presentation is online at www.bit.ly/MANA_HBS.)

Are you ready to join us in getting out the word about manufacturers’ representatives? Then help us reach out to academia! Contact your alma mater and offer to speak to a business class, or introduce us to key academics and we’ll schedule a MANA presentation there. Let us know how we can help!

Walter Tobin, Charley Cohon, Liz Beerman and Ken Hooper.

Special thanks to three other representative association executives on hand for MANA CEO Charles Cohon’s Harvard Business School presentation. Pictured with Cohon (second from left) are Electronics Representatives Association CEO Walter Tobin, Manufacturers’ Representatives Educational Research Foundation Executive Director Liz Beerman, and National Electrical Manufacturers Representatives Association CEO Ken Hooper.

Need to Hire a Rep Badly in a Big Hurry?

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“We want someone who’s willing to take risks.”
© cartoonresource | Dollar Photo Club

You probably will.

It’s a call I get several times a year from a desperate manufacturer. And it’s a call I never, ever get from a MANA manufacturer member. “I just lost the customer who has been 70 percent of my business for the last 10 years. So I need to hire a rep badly in a big hurry.”

I bite my tongue.

Because what I want to say is, “You want to hire a rep badly in a big hurry? That’s fortunate, because the only way you can hire a rep in a big hurry is badly.”

But I don’t say that. Instead I ask:

  1. What experience do you have working with representatives?
  2. Would you be willing to work on a Life of Part / Life of Program basis?
  3. Would you make some sort of contribution to the cost of pioneering new business with a Market Development Fee?

The response I get to the first question is either, “I’ve never worked with reps but now I am desperate,” or “I had a few reps but after they brought me some customers I didn’t see the value anymore so I terminated them.”

Their answer on the topic of “Life of Part / Life of Program” commissions is always the same. “No way. Why should I keep paying a rep for the business after I already have it?”

And their response to the third question also is consistent. “Nope. The cost of pioneering the line is the rep’s responsibility.”

Again, I bite my tongue. Because what I want to say is: “Let me help you write the ad.”

Representative Wanted

Manufacturer on the brink of bankruptcy needs representative to quickly deliver orders and save my company. No existing business, but don’t expect any financial help to pioneer our line. And if you do bring in orders that save my company, I am already planning to terminate you at my earliest opportunity.

The good news is that this manufacturer also consistently balks at paying MANA’s annual dues—which, frankly, is a relief, because MANA representative members deserve better principals than this one.

MANA manufacturer members, as a rule, know that working with reps is a marathon, not a sprint. Locating, recruiting, hiring, and partnering with reps is time-consuming, hard work. It doesn’t happen quickly, but once the hard work is done, the benefits can last for decades. Which is why quality MANA‑member principals don’t rush the process — they take the time needed to do the job right.

Sales Is a Terrible Job!

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Cold-calling strangers to pry hard-earned money from their hands in exchange for your products? Ugh!

Fighting off circling competitors who try to grab customers right out of your hands just as you’re preparing to close? Phooey!

Pandering to fickle customers who lead you on and then buy from somebody else? Unfair!

Meeting people who ask what you do and then wrinkle their noses when you reply “Sales.” Eew!

Fighting off an endless parade of upstarts who want to take your job and work for cheap? Sheesh!

If you think sales is a low-prestige job you settle for until you get something better, you will be right. Well, you will be right for you, at least. Because, with that attitude, you will always be scrabbling in the mud with peers who consider customers to be annoying obstacles between them and their sales commission.

Yes, for you, sales is a terrible job. But, as most MANA representative members know, it can be a wonderful career.

Yes, the first six months is hard for any new salesperson. And for new salespeople who spend that first six months trying to push their products onto anyone with a pulse, things won’t get any better after that first six months.

But for salespeople like most MANA representative members, who instead take a long-term approach and spend that six months studying customers’ problems before offering any solutions, something wonderful starts to happen. That salesperson starts to undergo a metamorphosis from salesperson to trusted consultant. And what started six months ago looking like a sales job undergoes a metamorphosis from job to career.

Careerists like MANA representative members have earned customer loyalty and have no reason to fear that a stranger with a slightly lower price can steal their customers.

Careerists are just as highly valued by their employers and their principals as they are by their customers, so they are also well-protected from upstarts who seek to encroach into the relationships careerists have with employers and principals.

And there is no group of salespeople where careerists are more highly concentrated than among MANA representative members.

Because careerists like MANA representative members treat sales as a career, at the end of each decade they have 10 more years of experience and 10 more years of customer rapport — unlike people who see sales as just a job, who end each decade with the same six months of experience, repeated 20 times.

“If I could just get my reps to do exactly what I tell them to do….”

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We don’t hear that from manufacturers who consider their representatives to be their partners, but companies with a top-down management philosophy sometimes complain that representatives push back when they are told exactly how to accomplish that principal’s goals.

A character flaw on the part of representatives? Or a virtue that protects overly top-down managers from undermining their own companies’ success?

A popular problem-solving computer algorithm called Ant Colony Optimization that takes its name and principles from nature may give us the answer as to whether day-to-day operations are best guided from headquarters or from the field.

Figure 1

Figure 1

When ants leave the colony to search in the field for food, they start their journey randomly, leaving behind a trail of pheromones that slowly evaporates. And when ants come across the trails of pheromones from other ants they follow the trail that is strongest and therefore the most recent.

As ants find food and carry it back to the colony, they double back on their own trails, leaving behind even more pheromones. And, of course, the shorter the round trip, the less the pheromones dissipate.

Figure 2

Figure 2

That strong pheromone trail attracts even more ants, which bring back more food and further reinforce the pheromone trail. (See Figure 1.)

Note that the queen of the ant colony has no role in telling ants where to go look for food in the field. That’s a job for the ants that actually spend time in the field.

Figure 3

Figure 3

The most impressive aspect of this self-organizing, field-driven system is demonstrated when ants encounter a fresh obstacle. (See Figure 2.)

Ants then randomly turn left or right to bypass the obstacle. (See Figure 3.)

Figure 4

Figure 4

The pheromone trail of ants that took the shortest path is refreshed more quickly than the trail of ants who took the longest path, so the shortest path is the most attractive and ants quickly abandon the longer path. (See Figure 4.)

The only instructions the ants receive is “bring food.” No step-by-step instructions from headquarters are required; it is up to the ants to sniff out the most efficient path to quickly bring the most food back to the colony. And the queen never tells them to go look under the third shrub from the left and report back with their results.

The Rainmakers

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My father, Harold Cohon, a retired manufacturers’ representative who celebrates his 91st birthday this month, served in the U.S. Army during World War II. In 1943 basic training brought him to Death Valley in eastern California, and we recently came across this photo he took at that signpost.

image taken in 1943

Dad snapped this photo in 1943.

Death Valley is the hottest location in North America, setting its record 134°F temperature in 1913. It is also the driest location in North America, averaging just two inches of rain per year. Based on what Dad saw, the only thing that seemed to grow reliably there was cracks in the parched desert floor.

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Dad back home,
enjoying the Midwest’s more moderate climate.

What Dad and most other people didn’t know is that Death Valley wasn’t really dead at all; it was just waiting for one final ingredient to show exactly what it was capable of.

It turns out that the earth in Death Valley is nutrient-rich and well-mixed with dormant seeds of flowering plants, all of the elements needed to support a vibrant ecosystem — except for one. Unknown to Dad, Death Valley was just waiting for water to show its amazing potential.

That potential revealed itself in 2005, when six inches of rain fell suddenly on Death Valley. Just as suddenly, this super-desert burst forth with an amazing variety of multi-colored flowering plants. Then, gradually, the water from that fluke rain evaporated. The desert dried up again, the plants died, and Death Valley went back to being the parched, cracked wasteland my father still remembers.

What can manufacturers and manufacturers’ representatives learn from the example of Death Valley?

An otherwise well-run manufacturing firm can be just like Death Valley. If all of the elements of a thriving ecosystem exist except one, nothing blooms. It is not a coincidence that the most successful manufacturers’ representatives are called rainmakers.

When professionally executed sales calls, like the rain, are added to the mix, a commercial ecosystem can thrive.

And removing that rain can destroy that thriving ecosystem, turning it into dust that will quickly blow away. A reminder that the excitement over harvesting a single, unexpected, wildly successful bloom should not be taken as a cause to fire the rainmakers.

IGAGFT — More Powerful Than 100 Five‑Star Yelp Reviews

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Who says that social media ratings are crucial to your company’s success? Everybody says so, but the truth is more nuanced than what “everybody” says.

Yes, social media ratings are powerful testimonials. And not only am I a big fan of those sites, as you read on you’ll see I’m also a big fan of sharing the names of great service providers.

When MANA moved from California to Illinois we needed to hire a moving company. The low bidder’s online reviews were pretty much summed up by one writer who concluded “I have never been given the runaround so much by a company in my life.” Game over. NorthStar Moving Corporation had great Yelp reviews so I signed up with them and got spectacular service.

When a family member needed to be able to summon help from a neck pendant 24/7/365, I checked Angie’s List and found very reassuring reviews for Lifenet Alert Systems LLC. Jacques Aboaf was very knowledgeable about his product and extremely compassionate when a family member’s illness weighed heavily upon us.

But I would never look at online reviews for an auto mechanic or a plumber.

Why?

Because when the dealer who sold my father his car told Dad that he needed new struts to cure the squeak in his car, we got a second opinion from Mike Hynes at Hynes Auto Service. Mike’s diagnosis? A dab of grease on two parts that were rubbing together. Mike’s price? “For a dab of grease? No charge.”

Because when family members’ sewers back up Bob Connelly at North Town Sewer Service comes immediately and even gave my father an unsolicited senior discount after Bob had already performed the work.

I have no interest in online reviews for auto mechanics or plumbers, because I have a trusted relationship with Mike and Bob — the kind of consultative relationship many customers have with manufacturers’ representatives they’ve known and relied upon for decades.

That’s how a manufacturers’ representative can be more powerful than 100 five-star Yelp reviews. When I have a few successful transactions with a provider, I have no interest in the opinions of 100 sincere strangers on Yelp, because IGAGFT (I’ve Got A Guy For That or I’ve Got A Gal For That).

That’s the power of manufacturers’ representatives who have earned a trusted consultative relationship with their customers — and why those customers are not interested the opinions of strangers, even 100 of them, because with a manufacturers’ representative IGAGFT.

I Am Not Sven!

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One manufacturers’ representative* reports heartburn over a Wall Street Journal article that describes smartphone app Universal Avenue as, “Like Uber, but for a sales force.” Here is his story. You be the judge.

“When I want a ride to the airport on Tuesday, Uber’s smartphone app pings the driver closest to me, and Fred picks me up. When I need a ride to the airport on the following Saturday, Uber again pings the driver closest to me, and Sally picks me up,” he explained.

“There are thousands of Uber drivers in my city. Will I ever see Fred or Sally again? Unlikely. Does driving me to the airport make Fred or Sally my ‘trusted transportation consultant’? Absolutely not!”

The article that triggered this representative’s indigestion, “Coming Next: The On-Demand Sales Force,” says of this smartphone app, “Companies can use it to get salespeople on demand, and these salespeople choose when to work and which assignments to accept.”

The article illustrates with this example: Sales freelancer Sven in Stockholm can decide to spend a few hours selling to pick up some extra cash. The smartphone app “considers Sven’s strengths and weaknesses, matches him with goods from any of a dozen brands, and plots a route through Stockholm optimized to include as many potential customers as possible in the time allotted.”

Just like Uber drivers Fred and Sally, Sven can choose to spend a few hours working where a smartphone app sends him. Sven’s likely customers are small businesses: “hotels, hostels, restaurants, clubs, bars, cafes, stores, beauty shops, tour operators, museums and similar businesses” where the owner is likely on site and easy to pitch on services like booking systems, delivery services, or credit card processing, says Techcrunch.com. It’s pitch, close, and move on to the next Universal Avenue-assigned target, a process the manufacturers’ representative describes as “Hit and Run.”

“I guess the source of my heartburn is that I have been lazy in using the phrases ‘outsourced sales force’ and ‘manufacturers’ representative’ interchangeably,” admits the representative. “Now when I have to explain the role of manufacturers’ representatives, ‘outsourced and cost-effective’ isn’t enough.

“I also have to explain the difference between an outsourced sales freelancer like Sven and an outsourced professional manufacturers’ representative like me.

“Sven may spend a few hours pitching credit card services to a half dozen bars and booking systems to a couple of restaurants before quitting for the day. As a professional manufacturers’ representative I am more interested building long-term relationships with customers who will treat me as a trusted advisor for decades than I am in writing any single order.

“I guess that until now I had become complacent about making that point clear when I described my business model. But I will make that point crystal clear in the future.

“I am a professional manufacturers’ agent, not a freelancer. I am not Sven.”

* MANA editorials are written to illustrate a particular point of view, not to recount any particular conversation with a specific manufacturers’ representative.

Don’t Spend Any Time Selling!

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MANA representative members shouldn’t spend any time selling. And I hope that none of the salespeople working for MANA’s representative members spend any time selling either.

Are MANA representative members in front of prospects and customers as zealous promoters of their principals’ products every business day? Absolutely. Do they put in even longer hours preparing for those sales calls and fulfilling the action items those sales calls trigger? More than any other sales force I know.

But the most successful ones don’t spend any time selling, they invest time selling.

When I make that distinction, I’m not trying to be cute. I am absolutely deadly serious. What happens if representatives who spend time selling make a sale? Once that sale is made and the commission is received, the representatives are right back where they started, with nothing more to show for their efforts than a single commission payment.

When representatives invest their time selling one of their principal’s lines, they look at a much bigger picture than just the commission on a single sale, things like these:

  • How will this sale build our relationship with this principal?
  • How will this sale enhance our relationship with this customer?
  • How will our strategy for this principal and this customer affect the other principals on our line card and other customers in our territory?

That’s why a top representative’s list of principals isn’t just a line card; it’s a line card portfolio in the truest sense of the word portfolio. And they have the same strategy for their line card portfolio that they have for their stock portfolio: “Buy and Hold.”

It’s true what they say about the stock market. The fastest way to get to a $5 million dollar stock portfolio is to start with $10 million and try to time the market. MANA’s most professional representatives invest time in their line card portfolio that same way a buy and hold investor invests money into a stock portfolio. They carefully choose companies they believe in and make consistent investments in them every month.

Sure, they may occasionally change out a single company in their portfolio, but they don’t go flitting from one bright shiny object to the next each month. They deliberately create a long-term strategy and work that strategy for the long-term. After all, for both the money they invest in financial instruments and the time they invest in their principals and customers, they are investors, not day traders.

ABC

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Editor’s Note: In the February 2015 issue of Agency Sales we described MANA’s continuing outreach to the academic community through MANA President and CEO Charles Cohon’s service as a judge for Professor Craig Wortmann’s “The Hard Sell” case-based sales presentation contest at the University of Chicago’s Booth School of Business. MANA’s outreach continues this month by discussing manufacturers’ representatives with Professor Eric Baron’s “Entrepreneurial Selling” class at New York’s Columbia Business School.

“ABC” is not “Always Be Closing,” Professor Eric Baron tells his Columbia University Business School “Entrepreneurial Selling” class. That kind of high-pressure, manipulative sales technique is a relic left over from the 1992 film, Glengarry Glen Ross. The correct “ABC” is “Always Be Collecting” information about your customers’ needs. Do that so you can provide consultative solutions, says Baron, who also recommends that his students build credibility and rapport by occasionally identifying and offering solutions for customer problems for which the salesperson’s company is not the solution provider.

phone of Cohon and Baron

Charley Cohon (left), MANA’s President and CEO, was a guest speaker this spring for Professor Eric Baron’s “Entrepreneurial Selling” class at Columbia University’s Business School.

Baron also sees the value in making sure his students know all they can about outsourcing the sales function. That’s why this spring he invited MANA’s Cohon to spend an hour discussing manufacturers’ reps with his students.

“To run a business you need to understand law, but you don’t have to be a lawyer. You need to understand accounting, but you don’t need to be an accountant,” explained Cohon. “You need to understand sales through courses like Professor Baron’s,” Cohon continued, “but once you understand sales, you don’t necessarily need to be your company’s sales force. You can outsource the sales function just like you outsource legal and accounting needs.”

Cohon used MANA member Bill Yorston of Yorston Associates, Hellertown, Pennsylvania, as an example of how a representative’s line card of complementary, non-competing products adds value. The example was especially compelling because it was close to home for these New York City students as Cohon described how Yorston’s sales of one of his principals’ lamps for the Marriott Marquis Times Square’s new sign led to orders for two of his other principals.

If this comment from one student is any indication, MANA’s goal of positioning manufacturers’ representatives “front of mind” with students and academia was successful: “I like this new business sales model of outsourcing, which previously I never thought of.” She continued by expressing interest in learning more about manufacturers’ representatives: “It would be great to have it in more detail.”

Harnessing Wisdom

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When MANA members retire and leave the association, their knowledge of our industry and our best candidates to mentor aspiring representatives are lost to the representative community.

Says one rep: “I’m comfortably retired from my manufacturers’ representative business, but I want to stay engaged in my industry and make myself available to manufacturers’ representatives who want to discuss a business problem or opportunity with someone who has decades of experience.”

Until today, we had no way to exploit that experience, match mentors with mentees, and let retired representatives stay engaged with their industry. To solve those problems we proudly introduce MANA’s Wisdom Council (members.manaonline.org/wisdom-council) and its first two members, MANA Past Chairman John Roba and MANA Past Director Ed Reese.

What is the profile of a retiree member of MANA’s Wisdom Council?

  • Eager to remain connected to our industry, so they want to receive Agency Sales magazine and MANA’s e-mail newsletters.
  • Eager to give back to our industry, so they are willing to selectively accept e‑mails or phone calls from current MANA representative members who would benefit from their long experience.
  • No longer a representative and no longer accepting commission lines, so they have no interest in being listed in MANA’s online RepFinder database that helps principals find new reps.
  • Not looking for new lines to represent, so they have no interest in MANA’s LineFinder database of principals who go to market with manufacturers’ representatives.

MANA members who need to discuss a problem with a member of the Wisdom Council should visit members.manaonline.org/wisdom-council for a list of available mentors.

Retired or soon-to-retire representatives, please e-mail MANA at mana@manaonline.org for complete details about MANA’s deeply discounted retiree rate. If you are accepted, you’ll be listed in MANA’s database as retired and not accepting any new lines, so representatives whose companies are still active should not apply for the retiree rate.

Late breaking news: MANA Director Greg Bruno has asked if experienced active MANA representative members who continue to work in their representative companies as full-benefits, full-dues MANA members can also volunteer to serve as mentors on MANA’s Wisdom Council. Great idea, Greg! Non-retired MANA members who want to volunteer as mentors are also invited to apply by e-mailing us at mana@manaonline.org.

Learning Sign Language

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Just when I think I must have touched about every market that’s served by manufacturers’ representatives, somebody comes along and teaches me about a market I’d never seen before that is well-served by manufacturers’ representatives. Any time that happens, it’s a great day. And that’s what happened when Bill Yorston of MANA representative member Yorston and Associates called me a few months ago to teach me sign language.

No, not that sign language. I’m talking about the language of the sign industry, where Bill and other manufacturers’ representatives make a major sales impact on behalf of sign industry manufacturers and enhance the image of outsourced sales forces.

What kind of impact do companies like Yorston’s have on the image of representatives? A very positive impact, says Sales Manager-Sign Products Joe Walsh of Orange, Connecticut-based Voltarc. “I will say that manufacturers’ representatives’ professionalism has increased dramatically over the years. So when I meet a manufacturers’ representative who knows every sign company in a six- to eight-state area, the ins and outs of what they are working on, and their typical customers, I know that’s a professional. And I know that I’m unlikely to find a new hire as a direct employee who could match that expertise.”

Jim Perritt, North America Sales Manager, Product Assembly Adhesives, of Uniontown, Ohio-based Lord Corporation is quick to cite the advantages manufacturers’ representatives bring to his company. Says Perritt:

  • They have established relationships with local distributors.
  • They know the local end users for our products that are our distributors’ customers.
  • They are more local to the distributors and the distributors’ customers.
  • They understand the applications for our adhesives.
  • They help us achieve a lower cost of doing business than we could achieve with direct salespeople.
  • They create synergy with the lines on their line cards. Our adhesives bond to substrates, so if they have a customer for substrates that customer is a candidate to buy our adhesives, and if they have a customer for our adhesives that customer is a candidate to buy the representative’s substrates.

Perritt continued, “If we move into another market we will absolutely look for manufacturers’ representatives in that market. I really believe in taking our products to market with manufacturers’ representatives.”

Without Yorston’s call, I would never have known about this robust ecosystem of manufacturers’ representatives and manufacturers in the sign industry. Is your industry one with which most MANA members may not be familiar? Call me at (949) 427-3027 like Yorston did; I’d love to learn more!

Nobody Belongs to MANA*

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© Chatchai5172 | Dreamstime.com

Nobody belongs to MANA. MANA belongs to you, its agent and manufacturer members. And because MANA belongs to you, it’s up to MANA to operate the association in your best interest.

The most obvious aspect of operating the association in your best interest is to be sure that your dues go toward the best programs and services we possibly can provide.

A more subtle aspect of operating the association in your best interest (and the subject of this editorial) is how MANA’s Board of Directors reviewed its own structure for maximum impact and productivity. For that task MANA’s Board turned for expertise to the American Society of Association Executives (ASAE).

In its book Race for Relevance, the ASAE research reveals that Boards with many Board members tend to be unwieldy and struggle to conduct their associations’ business. To break that gridlock, most large Boards then create a smaller Executive Committee that gets the associations’ business done but often marginalizes Board members who are not on the Executive Committee.

ASAE’s solution? Bring Board headcount down to a practical size that allows the Board to be productive — and then disband the Executive Committee. After careful review and consideration, MANA’s Board of Directors took this very remarkable step, voting to reduce its own headcount to seven members and to disband its Executive Committee. And to insure a regular influx of fresh insights and ideas, it also reduced Board members’ maximum service from two three-year terms to two two-year terms.

ASAE also recommends recruiting new Board members based on needed skills rather than solely on geographical districts. What’s the problem with recruiting Board members strictly based on geographical districts? Says ASAE: “If you pick a baseball team by zip code, you may end up with nine catchers.” It’s not a hypothetical situation — MANA once was forced to reject a strong Board candidate who was 50 miles on the wrong side of a district boundary. By Board vote, MANA’s Nominating Committee now gives strong consideration to maintaining geographical diversity, but a candidate’s skills now can outweigh being 50 miles outside a geographical district.

MANA often counsels representatives to work on their business, not just in their business. To operate MANA in your best interest, your MANA Board of Directors took that same advice to heart, strategically choosing to work on MANA’s governance, not just in MANA’s governance.

Interested in learning more about how Race for Relevance impacted MANA’s Board of Directors? Visit MANAonline.org/publications/race-for-relevance.

* Paraphrased from a quote from Jason Seiden, CEO at Brand Amper.

“Why Don’t They Teach About Manufacturers’ Representatives in Business Schools?”

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This year’s “The Hard Sell” drew 90 student competitors and gave MANA exposure to both MBA students and executives who volunteered as judges for the event. Cohon, at right, is pictured with Clinical Professor of Entrepreneurship Craig Wortmann and Senior Coach, Leadership Development Alice Obermiller.

It’s a common question from MANA members, and one that has triggered MANA’s outreach to the academic community, most recently at the University of Chicago Booth School of Business MBA program.

As part of MANA’s engagement with the academic community, MANA CEO Charles Cohon participates quarterly as a judge in that school’s Entrepreneurial Selling course, and annually in its “The Hard Sell” case-based sales competition where “teams of first-year MBA students try to sell themselves, their company, and their product to a variety of prospective customers.”

Wortmann’s Entrepreneurial Selling course was featured in an Inc. magazine article, “The 10 Best Entrepreneurship Courses of 2011.” Chicago Booth’s MBA program has consistently ranked in the top three schools in Business Week’s annual business school rankings.

“Experienced sales executives and professionals affiliated with sales are essential in helping participants process their learning during and after the competition,” according to Chicago Booth’s “The Hard Sell” judges’ instructions. “Two to three judges are assigned to a classroom to play the role of the customer during each of three different sales meeting scenarios.

“Teams of students pass through the classroom to attempt to sell the product to the prospective customer during these sales meetings. Directly after each meeting judges share one or two key observations on the team’s performance to help them calibrate toward the next round. Each team will be scored on how well they managed the meeting toward a successful outcome, including ‘closing’ the sale.”

Can MANA help your alma mater or a business school in your area to teach its students about manufacturers’ representatives? Use this link to share this article with that school www.MANAonline.org/2014/12/02/chicagobooth or send contact information for your school to ccohon@manaonline.org.

Principal Visit Better Than Trip to Disney World

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I just got back from what turned out to be one of my favorite business trips of all time.

Now, I have visited some amazing cities on business, including Tokyo, London, Stockholm, Salzburg, and Helsinki. So when I tell you that one of my favorite business trips of all time was Salina, Kansas (population 47,846) that should mean something.

Why is this trip one of my all-time favorites? Because I got to meet with a principal who really, really “gets” the representative system of selling and a representative network of the highest caliber.

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Brian Burmaster (left), Vortex Valves, joined with Charley Cohon, MANA’s President & CEO, to present an educational component for independent representatives at the manufacturer’s national sales meeting.

It started a few months ago. Brian Burmaster, Vortex Valves’ Vice President, Sales, contacted me to discuss adding a MANA educational component to Vortex Valves’ national sales meeting. Brian wanted to do more than just train his representatives on his products; he wanted to provide them presentations that would hone the skills they bring to bear on all of their principals’ lines.

Right away, I was very impressed. Whenever I deal with MANA principal members, I am usually struck by their commitment to the representative system of selling. But adding educational components that were not specific to his company’s products to a national sales meeting raises that commitment to a whole new level.*

Dinner with the Vortex Valves’ representatives confirmed that impression. Those representatives reported a decade, or two decades, or even three decades of association with Vortex Valves, and uniformly cited Vortex Valves’ professionalism in its dealings with representatives and the respect with which representatives were treated. One summed up the group’s sentiment in a single sentence: “If all the lines on my line card were like Vortex Valves, I would be a very happy guy!”

That’s why this was one of my favorite business trips of all time. I spent quality time with key executives of a principal that had earned the respect and admiration of its representative sales force, and with members of a representative network second to none. The icing on that cake: Vortex Valves and many of its representatives are MANA members. (As I pointed out to Vortex Valves’ representatives who are not MANA members, not being a MANA member is a correctable defect.)

A trip to visit a great principal and great reps is for me what a trip to Disney World is to a 10-year-old. So if you’re MANA’s CEO, Disney World is in Salina, Kansas.


* A tip of the hat to Charlie Ingram from Eriez Manufacturing, who also brought MANA into his international sales meeting for that same purpose in 2012.