The subject of shared-territorial development fees is one that seems to never go away and, in fact, would appear to be gaining increased interest from independent manufacturers’ representatives and added attention from manufacturers.

Recent communications with Agency Sales magazine and discussions among manufacturers and agents on the MANA LinkedIn discussion page would indicate that more and more agents are raising the subject in their initial discussions with prospective principals. At the same time, manufacturers are listening and learning about the time, money and effort agents expend in order to develop new business in a territory.

Here’s how one representative began … Read the rest

“When it comes to contracts, ‘win-win’ is a terrific philosophy to strive for.” That’s how one manufacturer opened a conversation on negotiating contracts with his independent manufacturers’ representatives. He goes on to say, however, that “I’d be less than honest if I wasn’t always striving for the agreement that would truly benefit me. And, I’ve got to believe most reps feel the very same way.”

With that as a prelude, he goes on to note how surprised he’s been over the years at the number of agents who simply sign the contract that his company offers them. “I’ll admit it’s … Read the rest

Two independent manufacturers’ representatives contacted Agency Sales magazine recently, both of whom told similar stories — stories that we, agents and manufacturers, have heard previously. We refer to their experiences here because while there’s obviously a “teachable” opportunity for both of the agents, there’s also an opportunity for manufacturers to hear firsthand what former agents think about an abrupt ending to what was a lengthy relationship.

The first agent recounted how over the last several years, he and his agency have found themselves on the losing side following a variety of mergers/acquisitions and sales management decisions that in his opinion … Read the rest

Over the years, this section of Agency Sales has addressed the question of what traits manufacturers find attractive in their independent manufacturers’ representatives. The reverse of that — what agents look for in their principals — hasn’t been explored quite as often.

Recently a group of representatives was queried on that subject and their responses were enlightening. Included in their responses to the question of what they found objectionable in principals were the following:

• “I’m especially apprehensive about continuing to work with principals who routinely make a big deal about any errors I might commit, but say very little if

“One of the major reasons my company decided to partner up with independent manufacturers’ representatives is their knowledge of the territory.” That’s how a manufacturer recently began his conversation with Agency Sales on the subject of using an outsourced sales force.

“But all that territorial knowledge that the rep has doesn’t do us any good unless he shares it with us,” he continued. That’s why this principal was such an advocate for the regular practice of visiting his agents in the territory. However, these visits do no good — in fact, they can be harmful — if they’re not carefully … Read the rest

If a manufacturer ever wants to identify a conversational flashpoint with its independent manufacturers’ representatives all he has to do is introduce the subject of house accounts. House accounts are guaranteed to garner opinions from all quarters, and it’s a subject that never seems to go away.

Looking through the pages of Agency Sales of more than a decade ago, one manufacturer offered his thoughts, which are as applicable now as they were then. According to the manufacturer, who boasted of more than 35 years experience working with agents, “We’ve always adopted a philosophy that we treat our reps as … Read the rest

When conversations of interest in MANA’s LinkedIn discussion room take place, we’re quick to bring them to readers’ attention, first, just for the true informational value; and second, we want to point out what a valuable resource the LinkedIn site is for sharing information and learning about best practices. That was the case recently when two discussions got our attention. The first involved the differences in principals motivating an independent sales force vs. a direct sales force. The second conversation involved how a principal should react when a rep sells in another rep’s territory.

A MANA agent member opened the … Read the rest

A manufacturer recently related what he considered to be a daunting task as he sought out agencies to represent his line of products in new areas of the country. According to the manufacturer, “We already had a solid reputation and good sales in the eastern part of the United States. Our next goal was to expand to the Midwest. Our initial efforts identified three prospective agencies to contract with. After we interviewed the first two, I have to admit I really didn’t know how I could choose one over the other.”

It was the interview with the third candidate, however, … Read the rest

Motivating a sales force — an area of shared interest to manufacturers and independent representatives — was introduced to the MANA LinkedIn discussion group and the results shed considerable light on why so many manufacturers opt for an outsourced sales force.

When an agent was invited to speak on the subject of the many benefits of outsourcing sales over a company direct sales force, he asked for input from his agent peers and from principals experienced in working with representatives. He described his task this way: “I have no problem espousing the many benefits of the rep model. However, part … Read the rest

In the course of examining the importance of sales training for this issue of Agency Sales, one manufacturer offered what he found was a major incentive to get his independent representatives to the training table. According to the manufacturer, who works with a network of agents throughout the United States, “We’re well aware of the built-in reluctance some of our reps hold about taking time away from selling in their territory. It makes sense to us that if they’re out of the territory they’re not where they belong — selling in front of their customers.

“However, just as important … Read the rest

As more and more independent manufacturers’ representatives introduce the subject of shared territorial development fees or retainers in their initial conversations with prospective principals, manufacturers have contacted Agency Sales asking for information concerning such payments. One of those manufacturers referred to a recent conversation on the subject that appeared in the MANA LinkedIn discussion group.

That discussion hit many of the major talking points on this subject and the manufacturer thought it might be enlightening for his peers. The conversation began when an agent explained that he was in the beginning stages of negotiating with a new principal and the … Read the rest

“Blame it on Gen X or whatever; I’ve got to live with it.” That’s how one manufacturer opened a conversation about a problem he was having with some of his inside sales staff. “Whatever or whomever is to blame, it’s up to us to find a solution.”

Here’s what he was talking about. It seems the new hires on his inside sales staff are on the young side. As a result, from the start he’s finding that many of them were more than satisfied with keeping their agents at arm’s length and communicating with them via e-mail, text and sometimes … Read the rest

There was no shortage of responses to a survey conducted by a manufacturer when he asked his reps what type of support they valued most from their principals. While responses covered a variety of areas, three distinct subjects were raised time and again.

Regular and timely communication — Nothing makes the reps feel more like a member of the team than always being included in the loop when it comes to corporate information. According to one rep respondent, “We don’t like surprises. They catch us off guard. That’s why when there’s a new personnel appointment, new product announcement, price change … Read the rest

“Businesses struggle to fill sales positions as economy picks up.”

The above is the headline from an article that appeared in USA Today earlier this year. The article detailed the woes of manufacturers who are faced with replacing the sales force that they downsized during the economic downturn.

Drawing from a number of interviews, the article maintained that “The American salesperson isn’t dead, but he or she is getting harder to find.” That situation resulted from the fact that as the economy improved, employers are facing a situation where there’s a shortage of qualified salespeople and managers, and that’s hampering … Read the rest

An ever-present subject for discussion among principals and their reps is that of call reports. In general, independent reps exhibit a dislike for them and tend to persuade their principals that they aren’t needed. Any number of manufacturers interviewed by Agency Sales over the years have expressed the view that in lieu of such reports, they truly appreciate the efforts of proactive reps who voluntarily keep them up to date with what’s happening in the territory.

Adding more fodder for the discussion is Brian Myers, Myers & Associates, LLC, Madrid, Iowa, who offers his take on the subject that should … Read the rest

When a manufacturer let Agency Sales magazine know that it was cutting way back on its direct sales force and expanding its rep network nationwide, a number of reasons (all based on past experience with its limited rep network) were cited as to why this move was going to be fairly painless.

According to the manufacturer, “Over our years of working with reps we’ve learned a number of valuable lessons that indicate we know how to accomplish this move, and we know it’s the right thing to do.” For instance:

Due diligence — “Maybe it’s by learning the hard way, … Read the rest

When a group of manufacturers got together at an industry meeting earlier this year, the topic of conversation very quickly veered in the direction of defining the ideal rep. One manufacturer was especially ready for this discussion as he reached into a manila folder and pulled out an old, wrinkled piece of paper with notes on it. He explained that he first came across what was on the paper years ago at a MANA seminar for manufacturers. On the paper was a list of attributes that the ideal rep ought to possess if the partnership between rep and principal was … Read the rest

A manufacturer passed along news of success he’s had by employing a practice that probably every human resource department uses.

According to the manufacturer, “Just as most companies in this country, we’re always conducting employee evaluations. Not only does the supervisor in our company fill out a form evaluating strengths, weaknesses, goals, etc., but so does the employee. Not to let a good idea get wasted, we’ve made use of this with our network of independent manufacturers’ reps. We regularly have our regional sales manager complete the same exercise with the reps in his territory. This simplified and short form … Read the rest

The timing couldn’t have been better for a conversation with a manufacturer who had recently undergone a sea change in its rep selection process philosophy. “I can’t help but think of the wisdom of that old definition of insanity,” began the manufacturer. “We were doing the same thing over and over again when it came to selecting reps and for some stupid reason we were looking for a different result. When I say we were looking for a different result, our past efforts were fairly abysmal. We were making poor rep selections and even when we thought we had aligned … Read the rest

Existing and prospective members of MANA are never alone. One of the best examples of this is the conversations and exchanges of ideas that take place on the MANA LinkedIn discussion page. For instance, when a manufacturer recently asked how to structure rep commission payments, there was no shortage of suggestions in response.

Here’s how the manufacturer posed her dilemma: “I’m looking to add an independent sales rep to market our OEM equipment. Where can I find information on how to structure commissions and the sales rep agreement? An average sale could be around $250K. I don’t have a direction … Read the rest

When it comes to learning what’s on the minds of reps, there are few better places for manufacturers to visit than MANA’s LinkedIn discussion group. It’s there that manufacturers and reps alike will introduce subjects that concern them. Then they sit back and wait for responses, and responses are just what they get. For instance, here’s what happened recently when a manufacturer wanted to know what others thought about having to pay reps over and above their normal commission.

A manufacturer began the discussion with the following: “I wanted to comment about rep compensation needing to change in order to … Read the rest

A manufacturer with more than three decades of going to market with reps made the point recently that there’s more to evaluating the rep’s performance than just considering the bottom line.

According to this manufacturer, “From day one, about 30 years ago, when we first started working with reps, we’ve always made it a practice to evaluate their performance. Our philosophy has been that if we don’t cast a careful eye over what they’re doing for us, there’s no real way of knowing if this is the most cost-efficient way to bring our products to market.

“When we started with … Read the rest

There’s a ton of information about everything to be found on the Internet — some of it good, some bad. Among the good was an article that appeared on a website entitled “State Start Up Nation.” It not only caught our attention because MANA was mentioned, but it also pointed out some fairly basic steps to follow in order to locate and sign independent manufacturers’ reps:

• Be Impossible To Forget

Simply signing some sales reps to sell your product doesn’t mean they’re going to devote full attention to it. “Your job is to make sure you stay top-of-mind,” says Jayne … Read the rest

Claims of “Big Brother” surfaced when a manufacturer made the request that his reps use e-mail addresses with the principals’ domain name. Their rationale was “Adding their logo to the end of your e-mails is the best way to provide a manufacturer with more exposure.”

Not all reps agreed with that thinking, however, as detailed in the MANA discussion group on LinkedIn. Two reps immediately noted that this “smacks of Big Brother” and is likely a first small step toward replacing the reps with “factory” reps.

Another rep offered that “I have flatly refused anything like this. I have principals … Read the rest

When a manufacturer asked for some guidance from MANA on his policy of reducing commissions as sales increased, he certainly got an earful from several MANA members. That input, which appeared in MANA’s LinkedIn discussion group, could prove valuable to other manufacturers as they encounter push-back from their reps in similar situations.

Here’s how the situation was described — The principal asked what the usual commission policy is for a situation like this: Their policy calls for a 1 percent decrease in commissions for every $500,000 in sales.

The first rep to take on the subject matter predictably began with, … Read the rest

When a manufacturer was recently tasked with finding reps for two of his territories, he followed the normal path of researching and finding prospective reps, interviewing them, and ultimately signing on with the agencies he thought were best. At the end of the process, he reports that his decisions worked out very well and he couldn’t be more pleased with the ultimate choices. What took him slightly aback, however, was something both agencies did upon signing their contracts. “I’ve got to admit that it’s been a couple of years since we had to replace two of our reps, so maybe … Read the rest

Communication is the major topic in this issue of Agency Sales. Discussion of that subject encouraged one manufacturer to offer: “There’s never any end to my frustration when I learn one or two of my agencies are struggling for any variety of reasons. It takes a lot of time and effort to get agencies to replace them. As a result, we always prefer to learn about problems as early as possible in the process. We like that because that way we can usually fix problems. Honestly, I wish more of my reps would call me regularly and update me on … Read the rest

The following article appeared in the Spring 2012 issue of The Representator. It is reprinted here with the permission of ERA and that publication.

As Clint Eastwood predicted in his often-replayed Super Bowl commercial, American manufacturing’s “second half” indeed appears to have begun. The Federal Reserve Board reports that, while still running slightly below its December 2007 peak, U.S. factory output has risen 16.7 percent since the recession’s lowest point in June 2009. Manufacturing job creation is outpacing other employment sectors, and the Department of Labor says factory wages are healthy, with new manufacturing jobs spurring more consumer spending than … Read the rest