The Care and Feeding of Your Rep Organization
The Care and Feeding of Your Rep Organization
Building a great independent rep sales team can be a challenge. As manufacturing moved offshore, and consolidation of component vendors in the electronic industry reduced the manufacturing base further, there’s been less and less need for manufacturer’s reps.
Downward trending commissions and price compression from low cost economic zone competition has put tremendous additional pressure on the rep business, leading to significant talent drain to other industries.
It’s tough today to carve out a career as a sales rep. Having worked previously as a rep for 25 years, I understand the difficulties, and have lived through most of them.
So keep in mind that when you find a good rep today, believe me, he or she is going to be one tough hombre. Chances are they’ve been through rapid change and fire. By and large, today’s reps receive more training and deploy more sophisticated tools for managing and promoting their good will and business relationships than those marketing a line card even a decade ago.
Often, I am asked - and tasked - how to get a rep’s attention. This is especially true if your firm is bringing a pioneering line to the relationship. It may be problematic for awhile to grab more than your fair share of the rep’s time and energy. Since your line is not paying the bills, does that mean you need to lurk in the shadows, biding your time? Not in the least.
Remember, the rep knew this was going to be a pioneering effort. However, a contract was agreed to, so there’s something you have that should appeal to the customer base. It’s simply a matter of seeking success, and these are my:
Ten Best Ways to Care and Feed Your Rep Organization
1. Pay commissions on invoice, on or before the 15th of each month. Rep’s are money motivated, so the best way to generate a rep’s attention is to pay commissions on invoice, on time, all the time. I have heard every excuse in the book from foot dragging principals, working overtime to delay commission payments. Nothing de-motivates a rep like this treatment.
2. Take care of the details. Agree to a concise two-way contract up front. Delineate each party’s primary responsibilities. Provide a detailed monthly sales report. Provide 1099’s before end January. Swiftly forward all sales leads directly to the rep and follow up. Get a handful of business and line cards from your rep and do a kickoff mail campaign in his territory with your card, catalog and a snazzy introductory letter. If desired, we have master copies of rep contracts and other legal documentation for re-use.
3. Provide an introductory rate, a higher commission for the first six months to a year, or a sliding scale that grabs the rep’s attention. Pay an attractive cash bonus to the rep for accomplishing a certain key task, e.g., first sample and/or order received from a target account. This gets your line promoted in front of more customers faster, possibly grabbing some low hanging fruit up front but more importantly, helps to build long term revenue via commission motivation.
4. Mitigate reports. Nothing irritates a rep more than paperwork. One rep I worked with for many years once told me he was going to write a book, “Forecasting Your Way to Bankruptcy.” I have known manufacturers that have literally pinned me to my desk for a week a month filling out spreadsheets and creating presentations. It always blew my mind that these same firms hired me to sell their line and then, promptly took me out of the field. I understand that manufacturing companies live off their forecasts but do yourself a favor and find a different way. Refer to #5, below.
5. Keep comm lines open. Early on, train. And then product and application train some more. After that, send a one-paragraph product training refresher email once a month. Make it easy. Have planned weekly calls to discuss projects, potentials and possibilities. Cover each customer quickly and then document the action items. Follow up. Talk over prospects. Find out how the rep’s line card is doing and how their business looks. Look for synergistic opportunities. By communicating and getting on the same page, you should be able to forecast for your company much more effectively, accurately and comprehensively all by yourself. And faster, too. If forecasting truly is your firm’s lifeblood, don’t outsource it to commission-based contract personnel.
6. Don’t be a moocher or cheap. When you travel with your rep in their vehicle, always pay for the gas. Buy the meals. Coffee. I often pay for hotel rooms on road trips with my reps. Pick up morning donuts or a fruit plate for the first call and have your rep carry the box in. Same with a distributor lunch. Support. These are not little things to your rep, and if they don’t appreciate it, you probably have the wrong rep.
7. Provide sales stuff, a reasonable amount of free customer samples, catalogs and a sales sample kit. Electronic presentations with the rep's name on them. Gather and document proper information regarding the business opportunity on each customer sample. Track the samples to conclusion. Refer to #8, below.
8. Don’t disrespect. Always ship customer samples to your reps for hand delivery, unless they request otherwise. Boost the rep’s reputation during customer calls. Don’t go around your rep. Don't cut your rep out of the loop. Be involved at the account but maintain your rep as the point of contact. I am an eye-witness to general managers of manufacturers clumsily undermining their own rep in front of the customer and later, astonishingly complaining about the rep’s ineffectiveness.
9. Work as a team. I have always told my reps that I wanted them to make as much money as humanly possible. The more money they made, the more money I made.
10. Be honest and have fun.
Good luck. Let me know if I can help in any way: [email protected]