Volume 8, Issue 10 - November 2007
Mr. (and Mrs.)
“The ability to direct versus coach. Cost. Selection of direct people versus the agency ... meaning, I can choose whom to hire person by person—I don’t have that ability with an independent rep,” says Junker.
Randy Cohen, vice president of sales and marketing for Frank Lowe Rubber and Gasket Co. Inc. in Farmingdale, N.Y., has had positive experiences during the past 25 years with independent reps.
Frank Lowe uses this type of salesforce for many reasons, but Cohen says, “The number-one reason is to provide onsite service to the customers, to develop and build relationships … I have them across the country as opposed to me or my salespeople having to travel across the country—they’re a phone call away.”
Although choosing the direct employees with which to work may be a benefit, in many cases, the suppliers are able to build relationships with independent reps better than direct salespeople.
“[A] long-term relationship with an agency versus more short-term with a direct or regional salesperson [is advantageous] due to desire for advancement and the tendency of us all to move jobs every few years. That does not typically happen with an independent rep firm,” Junker adds.
He adds that most independent reps have also developed relationships that can come into play when making a sale.
“A well-trained and focused direct person can be just as hungry [for the sale] ... but you receive instant creditability as the manufacturer with a good agency, due to the relationship already in place with the companies’ other lines being sold or a relationship already in place with a new prospect that you don’t necessarily have with a direct salesperson,” says Junker.
Cohen agrees. “I would probably say the biggest difference for us, versus the measurement we’ve had with inside sales staff, is the years of experience that sales reps bring and the vast knowledge of working with manufacturers.”
Junker says that independent reps also have the ability to familiarize themselves with a company’s entire product line, which means the rep can assist a customer who’s not sure for what he is looking. “The independent rep can be a part of much more than the specific product line or system under review and, in many cases, has a very good understanding of the customer’s entire product line and business philosophies, so they can interact with both the customer and us to obtain the best business solution for the given opportunity,” says Junker.
The Times are Changing
Independent reps say they also sometimes have a broader product line to offer the customer than an individual salesperson might.
“We have more to offer the customer,” says Miller. “If a customer doesn’t like what a direct salesperson is offering, the salesperson won’t go back. However, I go back and sell different lines to the same people.”
Wanda Seaver, founder and president of SeVan Sales Inc., an independent rep firm in San Marcos, Calif., agrees. “We have direct contact with the customer and that provides us with valuable information that enables us to serve both the customer and the supplier. When we do our job right, the customer receives a better product and the supplier increases [its] market share,” says Seaver.
There are cost savings as well when using independent reps.
“Just the traveling alone is a tremendous savings,” says Cohen.
“We don’t pay unless there are sales made,” says Junker. “The independent reps take care of all their own expenses, etc., so the new cost is a known number based on the rate and the total sales dollars ... no hidden costs for insurances, travel expenses, vacations, etc., that you have for a direct person.”
Derek Miller of Window Components and Supply Inc. in Phoenix says that when working with captive salespeople, customers sometimes get more individualized attention, than with independent reps.
“In this region of 11 western states, we have six individuals with specific territories,” says Miller. “There’s more face time.”
However, Seavers says she still puts in lots of personal time with customers as an independent rep—which is good for business, but can be tough on her. She cites constant travel as one of the drawbacks to working as an independent rep. “[You are] learning how to balance your schedule so the suppliers you represent know that they are number-one on your line card. .... and finding time to always follow up with your customer,” Seaver says.
Making sure you’ve chosen the right companies to represent is also a concern.
“The risk is constantly worrying about your principals, adding that you are at the mercy of your principals,” says Miller. “It’s a huge risk.”
Likewise, once you have found a good principal, sometimes it’s still a concern.
“The more successful you become, the higher risk you are for that principal, since [your supplier] could cut that expense in half,” he says.
Seaver echoes Miller’s concern.
“Remember, we don’t get paid if both sides are not kept happy,” she says.
Tracy Califar, an independent rep for American Weather Seal and Hurd, says starting out is the toughest part.
“We got hooked up with some good companies and we just kept working,” he says. “Things take a while to grow.”
Likewise, Califar found that he had to start small.
“Not everybody wants to turn over existing territories that are thriving,” he says.
Robinson says the growing market doesn’t hurt, either.
“For the last 13 years, [the] window business has been growing. It’s been a pressure to the supplier but, since 2006, that has flipped for the manufacturers,” he says. “The supply side has been very aggressive. We’ve seen a real flip in where we’re spending our time trying to gain new business. It’s usually a three-year cycle and then it will grow again.”
Seaver has some advice for those starting out as independent reps. “Remember that as an independent rep, you are serving both the manufacturer and your customer,” she says. “Don’t hesitate to go the extra mile for your supplier or customer … they will remember. Always try to put yourself in both the customer and supplier’s shoes. It will always help you find the right answer.”
Robinson adds that it’s important to focus on product benefits—not price.
“Focus on upscale components and up-sell their benefits, instead of just, ‘mine is cheaper than yours,” he says.
As in any business, Seaver says reputation is of course important. “You determine how much it is worth,” says Seaver.
Window Manufacturers Weigh InHurd Windows and Doors in Medford, Wis., uses both independent reps and a company salesforce, but Joe Herman, vice president of sales and marketing says, “I really have no preference—I just want the best salesperson I can get. I don’t look at it as a savings or an added expense.”
Herman says that there isn’t much difference in cost for the company. He does say he has noticed that independent reps can be more eager for the sale of one of their products. “If they don’t sell, they don’t eat,” says Herman. “But we pay all of our salespeople on a commission basis so the good company guys that want to make more money are pretty ‘hungry’ as well.”
“Company salespeople only sell our products so we can control what they do. Our reps can sell other products, if they are non-competing. We do limit how many other lines they can sell, but they are independent, so corporate management has less control of there time,” adds Herman.
ISC Grew from Small Roots to National Independent Rep
Q: How did you get your start as an independent rep for the fenestration industry?
Q: How is ISC different than other rep organizations?
Q: Why did you decide to expand your company to cover the entire country?
Q: Where is your company most successful? Why?
Q: What qualities do you look for when hiring reps to work for you?
Q: What do you look for in a principal and new line?
Q: How important are the lines a rep sells?
Q: What is the biggest challenge you face in the daily operations of your company?
Q: How have the rising prices of travel expenses affected your company?
Q: With the housing market decline, have you had to adapt at all, make any changes to the way your company does
Q: Do you sell imported products from any of your principals?
Q: How do you think independent reps will respond to the growing amount of fenestration products imported from China?
Q: What do you hope to see for the future of ISC?
Sarah Batcheler is a contributing writer for DWM and Penny Stacey is assistant editor for DWM.