Posted on August 22nd, 2019 by David Yovich
Establishing a network of independent reps across geographic regions is a tried and true strategy during initial expansion, however, it tends not to be an effective long-term strategy. The traditional benefits of independent reps include market exposure and the ability to use their contacts to build product awareness. The reps have networks and the hope is that they will push your product(s) through their respective networks. The truth is that independent reps usually spend 90% of their time on their bread and butter accounts, while the remaining 10% is divided between four to six filler accounts. Many companies deny this truth and feel slighted, disappointed, and angry. It’s not the reps’ fault, rather the fault lies with the companies who simply do not understand their place in the reps’ account mix. Reps are small business owners and just like any business will take the path of least resistance in order to ensure they turn a profit and make a living.
“Lunch and Learns” are expensive and most companies will only reimburse the expense of the "lunch and learn" and only if the rep solely discusses their product(s). If a request comes in the independent rep will provide a "lunch and learn", but it’s illogical to think that they will set such an event up on their own accord. Independent reps need to concentrate on selling as much product as they can tomorrow, better yet today, not twelve months from now. From their perspective an architect "lunch and learn" can be a gamble. It’s possible the architect might have an applicable project in the stage of pre-specification where the product might be used, but chances are an applicable project is much further out on the horizon. Companies’ expectations rarely match an independent rep’s output. But that's not the rep’s fault. For example, an expectation for a rep to actively seek to schedule and/or conduct a “lunch and learn", especially for a prospective client that may not be one of their bread and butter accounts, will likely lead to your disappointment. If the architect does remember and does specify it might take an additional twelve months until the product is actually ordered, that is if the architect doesn’t specify “or equal” and the contractor subsequently makes a switch. Many independent reps feel that "lunch and learns” are counter productive to their sales processes, and from their perspective they may be right.
The first stage in every sales funnel, no matter the industry, is “awareness”. It’s the most significant and time consuming aspect of the sales funnel process. “Awareness” is most efficiently achieved through strategic marketing. In fact, the essence of true marketing is to build, then reinforce product awareness which eventually converts to a qualified lead. It’s not the independent rep’s job to market your product. Their job is to convert qualified leads into sales opportunities. It’s the company’s job to provide those qualified leads.
They allow companies to gain and maintain coverage in geographic areas without having to make a substantial investment in hiring in-house manufacturers reps. Independent reps allow small-to-medium size BPMs to build out a territory and/or immediately support a new distributor. Independent reps will also seize sales opportunities that may otherwise have gone untapped, especially if there are complementary product lines they represent. The issues arise when BPMs believe that the use of independent reps represent a reliable and enduring long-term solution. This belief breeds certain expectations that are counter-intuitive and unrealistic to the very nature of what makes an independent rep personally successful. If you have issues with your independent rep network it might not be their fault. I was once told that every time you point your finger at someone else, you have three fingers pointing back at yourself.
Understand that independent reps should be part of the strategy, but more just a cog in a larger growth engine. Create a strategy that incorporates developing marketing awareness to drive leads to the company, which will allow more options to navigate the sales funnel. Hold independent reps accountable, be transparent about your expectations for them, and don’t be fearful of letting them go if they are not helping to navigate the sales process once awareness produces qualified leads. Work directly with distributors to develop market strategies, don’t rely on the independent reps to foster that relationship for you. Independent reps should be treated as a tool, but understand they are more like a phillips screwdriver (a specific tool for a specific function) than a swiss army knife.