Why Use a Rep
Using a rep doesn’t just make them experts on your product; they also are experts in their local market area. Since they have years of experience in the local market, they has no reason to leave that. They have a lifetime commitment to the territory.
The manufacturer and sales agency agree in advance on a set rate of commission and the agency pays all selling expenses.
Manufacturers who support their sales territories with reps often report achieving deeper market penetration than they could with a factory-direct salesperson.
Today’s multi-line field sales agent is highly educated and trained. Since there is no base salary to rely on, they must sell to live.
A new agent has only to learn your company’s products, culture and systems, and many agents won’t even need product training. All are well-versed in selling skills so you won’t have to train them how to sell.
Reps can increase your volume by selling outside your present marketing territory.
Since an agency must sell to live, your agency is interdependent with your firm. Your success is their success.
What Are the Advantages of Manufacturers’ Reps?
Hiring reps avoids all the fixed costs of direct sales employees, including: salary, medical insurance, workers compensation, human resources, travel and entertainment, and more.
If you have a relatively narrow product line, your rep can bundle your products with products from other manufacturers on and include your product in a package deal you could not easily put together yourself with you narrow line.
Reps have intimate knowledge of their territories. Most representatives have years or decades in their territories. That’s more than just market knowledge. Your rep has some personal connections with your customers, which is a big advantage over a direct salesperson who is just making a 1-2 year stop in the territory before moving to another territory.
What Are the Disadvantages of Manufacturers’ Reps?
While reps will be able to meet any goal you give them, you generally can’t tell them how to achieve it. Reps are independent businesspeople, and although they like challenges and stretch goals, most will want to set their own plans on how to achieve those goals rather than allowing a manufacturer to tell them how to meet their goals.
You hire the rep because they have customer relationships that you want to participate in, but if you expect that you will come to own the rep’s relationships you probably will not be successful with reps. Reps bring their customers’ relationships, but you will find that those relationships stay with the rep and are not transferrable to you.