Whether manufacturers know it or not, their reps are constantly evaluating the profitability of their lines. This can be done formally via a structured line profitability analysis or informally with the rep actually measuring how much time he spends on a line and then asking himself if it’s really worth the effort. Depending upon the analysis of accumulated data, what inevitably can result is a parting of the ways.

Two reps recently reported to us the results of their decisions concerning some of their lines. According to the first rep, “Ours was a fairly simple decision. We contacted two of … Read the rest

When considering what type of rep — whether a generalist or a specialist — is best for you, what it comes down to is determining from the outset what works best for you and your company.

For instance, one manufacturer that is firmly in favor of the generalist maintained that “although agents do need a certain level of technical sophistication in order to sell our products, that level is not as high as you might imagine. I look for agents who have a wide range of competencies; who can move quickly from one sales situation to another.”

On the other … Read the rest

The joint concerns of what reps and principals should expect from each other in the relationship were tackled by a group of manufacturers and reps when they recently got together. See if any of these items are important to you. First, consider what they had to say about the rep’s expectations of their principals.

Expectations — “Will there be a clear understanding from the very beginning of our relationship of the expectations of each other that we’ve jointly agreed upon? How about collections? If a joint customer is in arrears, do they expect me to go out and make collections? … Read the rest

A manufacturer who was switching from a direct sales force to reps called recently for some guidance.

During the course of the conversation, he mentioned that he planned to take on each rep in each territory on a trial basis. When he was asked why and what he thought an appropriate trial period should be, he answered, “I want to make sure that I’m doing the right thing by switching to reps and I want to make sure that each rep I appoint is going to be able to do the job to my satisfaction.”

When it was explained that … Read the rest

In the course of a conversation covering a variety of topics a manufacturer with a long history of working with reps was asked if he would be willing to share his thoughts/philosophies concerning house accounts.

Here was his thinking on the subject: “We’ve been in business for well over half a century and have a proud history of working with independent reps for more than 40 years. With that long period of time in place, we’ve adopted a philosophy that we treat our reps as part of our family. We don’t look upon them as ‘just those guys who get … Read the rest

When a manufacturer heard a comment from an attorney concerning working with reps in the absence of a contract, here’s how he reacted:

“I can understand what the attorney was saying. He advised reps to be wary and to avoid contracts that were not fair to both sides. As a matter of fact, he stated his case quite succinctly when he said: ‘In the absence of a clearly worded contract that is fair to both the manufacturer and the rep, I’d advise the rep — if he really wants/needs the business — to go ahead without a written contract.’

“That’s … Read the rest

MANA has been especially active over the last several months when it comes to conducting MANAcasts and MANAchats during which association members can network and share solutions to various concerns and problems.

More than once during those sessions, the subject of contracts between reps and their manufacturers comes up. To that point, there’s never a bad time to emphasize to both reps and their principals that it’s critical to have and rely upon the terms spelled out in a written contract between the two entities for the following reasons:

• While personal relationships and handshakes are great, they should never serve

If one manufacturer didn’t know beforehand that his agents thirsted after product training vs. sales training, he certainly knows it now.

That’s what the manufacturer reported after some input from several of his independent agents. According to the manufacturer, “I had several of my reps approach me with a request for training. But, at the same time, they were adamant that they didn’t want sales training. They were after product training. Their message to me loud and clear was that since they had already carved out successful careers for themselves as independent representatives, they knew what they had to know … Read the rest

For every action there naturally is going to be a reaction, and that’s exactly what happens when a manufacturer makes an inquiry of a rep. That point was made recently when a rep asked the following: “One of my lines’ competitors tried to hire me. I declined out of loyalty to my current principal. Is it unprofessional or bad manners to share that information with my current principal?”

What’s important to keep in mind here is that reps are going to react — one way or the other — to questions of that type. Here’s some of the feedback on … Read the rest

When a manufacturer with a history of working with a network of independent reps asked an audience of reps how he could best motivate some of his reps who he claimed were underperforming, there was no shortage of responses.

Kicking it off, one rep asked in return, how do you gauge that they are in fact underperforming?

After posing the question, the rep continued: “No doubt, there are some people who are underperforming. However, as I consider many of the reps I personally know, reps are driven to make as much money as possible. If they can’t make that with … Read the rest

It’s not just the independent rep that believes having a written contract with their principals is imperative. That point was driven home recently when one manufacturer contacted Agency Sales magazine with the following thoughts.

“The executives of our company have always felt that it’s critically important to have our reps under written contract. Our approach is that we choose our reps very carefully. That means we spend a lot of time searching for reps, interviewing them, visiting them, and having them visit us and get to know our people. Figuratively, they become an integral part of our family, our organization. … Read the rest

Manufacturers’ reps and their principals truly believe they are adding value for their customers. Despite this belief, however, many of them have seen their profit margins become razor thin because of deeper discounting, extended terms, and special offers. The question that should be front and center of everyone’s mind is this: “If we are adding value, why do our customers continue demanding lower prices?”

In answer to that ever-present question an industry consultant offered some thoughts that manufacturers ought to be sharing with their reps.

Customers have heard the promise of added value from advertisers and salespeople for years. Yet, … Read the rest

It was a little bit like a self-fulfilling prophecy when one manufacturer described the difficulty he continually faced when it came to filling direct sales positions in a number of his territories.

According to the manufacturer, “It seems as if they (the factory direct salespeople) can’t wait to get out the door. We just get them trained and attuned to developing relationships in the territory and then they either take another position in our company or leave the company entirely. It’s like being on a merry-go-round that keeps spinning people off.”

This manufacturer is hardly alone in facing this problem. … Read the rest

In the course of an interview with a rep that focused on his long-standing relationship with one principal, the rep volunteered that while there were many reasons why the relationship has weathered the test of time, there were three very important attributes the principal possessed that the rep valued:

• “The principal’s in-house rep-support teams are outstanding. When we contact them there is no problem left unsolved, no question left unanswered.”
• “They generously support us in our joint field visits to customers, and they always allow us to take the lead in presentations to customers.”
• “They have insisted that we complete

It’s no secret that reps don’t always react in a positive manner when one of their principal’s regional sales managers asks them to schedule joint sales calls.

One manufacturer, however, couldn’t miss the opportunity to pass along positive comments she received from a rep on his RSM. According to the rep, “The sales manager was very upfront when he told me not to be wary of selling other lines that I represent — when the opportunity presented itself. But the main purpose of his joint sales call visit was to make appointments with especially good customers for his products and … Read the rest

A manufacturer recently wrote to Agency Sales about the relationships he enjoys with several of his independent reps. This manufacturer should be forgiven for his boasting because what he wrote about shows that he and his reps know what it takes to forge a strong relationship.

Here are a couple of the reasons why the manufacturer felt he was entitled to be so proud about how he works with his reps:

• “We and our reps have worked long and hard at sustaining relationships. It’s a little like a marriage. If the little things go wrong and you start picking at

It’s hardly uncommon for principals to rate the performance of their reps and for reps to rate their principals, but here’s a bit of a different twist to the ratings game.

A manufacturer recently informed us that she’s made it a regular practice to ask her reps to rate her performance with them. “Our motives are fairly clear cut,” she maintained. “We simply wanted to know where we stood above and beyond our competitors and the other lines that our reps carried. This was an outgrowth of the fact that we’re well aware of how most of our reps perform … Read the rest

A manufacturer recently offered what he viewed as a report card that evaluated his company’s performance in the marketplace once they had made the move from a direct to an independent manufacturers’ representative sales network.

Here’s how he described his company’s experience: “From the very beginning the combination of all of our reps’ talents clearly became evident. Their in-depth knowledge of the territory, local contacts and relationships coupled with their flexibility in the field immediately improved our market performance.”

He continued, “Then there’s the issue of synergy. The agencies we chose to go to market with had line cards that … Read the rest

There’s an ever-present concern that presents itself to manufacturers’ reps when they are seeking the attention of principals looking for representation: “What do I have to do to show a manufacturer that I’m the right one for him?”

Here’s how one manufacturer addresses that concern:

• “Here’s the first thing I consider: Do I even know he’s there? What has the rep done to establish his brand in the territory? How long have they been in business? Do they communicate what other lines they represent?”
• “Has the agency been a presence at important trade shows that I attend? Have they ever

The president of an electrical products company recently emphasized how important it was for his fellow manufacturers to be on the lookout for rep firms that have reinvented themselves.

According to the executive, the kind of rep that he looks to go to market with is one that operates in a lean and efficient manner. “The pressure for cost reductions in our marketplaces will certainly not subside. As a result, we’ve got to challenge everything we’ve always done. Once you do that you’ll be surprised at what you can do without.”

In the course of challenging everything you do, he … Read the rest

When a MANA member described an issue they encountered when negotiating an agreement with a prospective principal, she got plenty of feedback from her rep peers.

According to the rep, “The principal in question does not want to define a territory and they want to work on an ‘account-by-account’ basis. They are not offering any exclusivity; they demand the agency be exclusive to them. They have yet to offer a defined reason other than it ‘is not in their culture to offer exclusivity and it’s something they haven’t done in the past.’ They have even hinted that it is illegal … Read the rest

There have been innumerable articles in this publication and others concerning the communication that manufacturers should expect from their reps. There’s another side to this subject, however. When several reps were asked what they truly value in the types of communication that they receive from their principals, here were some of their reactions.

“While most of our principals are fairly small, putting out a regularly scheduled newsletter would obviously be a major undertaking for them. What they do, however, is to religiously let us know anything and everything important that’s happening with them that can impact our work in the … Read the rest

It’s hardly unusual that rep‑principal relationships start off very well, but before anyone realizes what’s happening, things begin to sour.

Part of the cause for this disintegration of the relationship is that once reps are signed on, they are all too often forgotten. A bad situation can be exacerbated when principals fail to offer reps any orientation, visiting the home plant is not encouraged or there’s no strategic plan and no real commitment to the rep way of going to market. It would appear that as long as the orders keep on coming, nothing has to be done to maintain … Read the rest

Elsewhere in this issue of Agency Sales magazine, a rep offers his definition of the value that he delivers to the principals he works with. Conversely, a manufacturer recently communicated to Agency Sales how she defines the value proposition.

According to the manufacturer, earlier in her career she was faced with the task of justifying the continued use of her company’s network of independent manufacturers’ representatives. She quickly offered a convincing value proposition that tipped the scales in favor of retaining reps. Her experience serves as a valuable lesson to others faced with the same dilemma.

Here’s how that national … Read the rest

It’s very satisfying when the message promoting the value of reps gets repeated by an outside source. Recently, the following came across our desk from a company that provides a matchmaking service for manufacturers and reps. It’s interesting that the benefits cited by this company so closely echo the message that has consistently been repeated for years by Agency Sales and MANA.

According to the company, it’s important to consider the type of product that the manufacturer is taking to market. Off-the-shelf products tend to be sold through resellers. The reseller’s value add is same-day delivery. The more engineered the … Read the rest

A manufacturer with a long and fruitful relationship with reps was asked whether it’s ever been a good idea for her or her agents to hold back information. Without missing a beat, she offered the following: “How could that ever be a good way to operate? If anything, I’d strongly recommend a practice of full disclosure on any and all issues, because isn’t the real foundation of our business relationship built on information, communication, trust and education?”

She didn’t stop there: “How about when we’ve got a new product introduction? Shouldn’t it be of paramount importance for us to let … Read the rest

After participating in a virtual conversation with three of his reps on the continued importance of reps regularly evaluating their principals, a manufacturer offered his thoughts on doing the opposite.

“I annually review how my reps are performing and when I find a problem or determine that something is amiss, I take care of it right away. Here are a few of the things that I’m concerned with.

“Before I even choose which reps to work with, I learn all about their length of tenure in the territory. After that, however, I regularly evaluate:

• Among their lines, how many are

On the subject of the type of communication one manufacturer desires from its manufacturers’ representatives, one manufacturer appears to have landed right on top of a true winning formula.

Instead of asking for regular reports from the field, this manufacturer has asked its reps to only communicate when there’s something important to report. “The rep’s performance in the field shows us whether he’s doing a good job for us or not. If we were to push for regular reports, then that only muddies the water and to be perfectly honest, if we’re deluged with regular call reports, we’re not going … Read the rest

One manufacturer was fairly quick to back track on its decision to move from an independent rep sales force to direct salespeople. About 18 months after making the change the manufacturer went back to its time-tested and successful rep model.

According to the company’s sales manager, “We initially thought that we were at a point in our growth where it was economically justifiable for us to take our sales direct. To say we were wrong is an understatement. Not only did we come face-to-face with the economic problems just about everyone else has encountered, but we learned that there were … Read the rest

If there’s any concern that reps regularly have, it’s the danger that accompanies becoming too successful.

The typical scenario goes this way: a rep has grown business with one large customer well beyond expectations. As a result, the manufacturer’s attention is drawn to the fact that he’s writing very large commission checks to the rep on a regular basis. While on the one hand the rep may appreciate this situation, on the other hand, he’s aware of the fact that the manufacturer may decide to remove him from that account and replace him with a direct salesperson.

In response to … Read the rest