The Rep and their Principal Companies
In an earlier CISCA Rep Corner we discussed the responsibilities of an Independent Manufacturers&’ Representative. In this column we will revisit that subject but expand upon it to include the other key ingredient, the synergy and collaboration between the Rep and their Principal Companies.
An Independent Manufacturers&’ Representative Firm&’s responsibility is to professionally represent their principal companies as the sales force for the company. This is an obvious benefit to the company for it eliminates the fixed overhead of a salesforce, and takes advantage of the synergy available with a Multi Line Representative Organization. A knowledgeable representative knows their architectural community and the specific products that are appropriate for each account. This results in a rapid promotional impact in the field with little wasted effort.
It is important for a Rep firm to conduct business in a professional manner, keep up with technology, and be creative. Some of the Reps responsibilities include:
- Locating projects in the conceptual or early design phases, utilizing Dodge Reports, CMD or referrals. and contacting the architectural firm for an appointment
- Presenting the principal company&’s appropriate products and concepts to the project architect and owner during the preliminary design phase. Listening to them.
- Assisting the project architect in the selection, modification and detailing of the products during the preliminary design and working drawing phase.
- Assisting the specification writer in specification preparation and technical research during the final working drawing and pre bid phase.
- Securing samples and details, coordinating all product modifications, and working with the manufacturer to create solutions for the project. Coordination with other project consultants.
- Furnishing the manufacturer with appropriate bid documents, assisting in preparation of material quotations and furnishing all bidders with quotations and required details.
- Engaging in price negotiations with contractors and securing purchase orders.
- Submitting samples and literature for approval.
- Coordinating the placing of orders with the manufacturer and the contractor.
- Following up on shipments.
- Troubleshooting throughout construction, attending job meetings.
- Assisting in collection of invoices.
- If and when the invoices are paid, receiving a commission.
The elapsed time of this process is often two to four years, with all Rep expenses and overhead paid by the representative company.
Independent manufacturer&’s representatives often have a very large investment in their business, a fact that is not commonly acknowledged in our industry. Offices, salaries, automobiles, insurance, workmen&’s compensation, communication, computers etc. Commissions received are not “profit”, but a contribution to overhead, as in all other businesses. It takes years of investment to create a successful enterprise.
In order for Independent Manufacturers&’ Representative Firm to be successful, the manufacturer also has a tremendous responsibility. The first and foremost responsibility is to produce a high quality product, at a reasonable price and provide on time delivery. That is only the beginning! In speaking with a number of manufacturers who have a very long and successful history utilizing Reps as their salesforce, a number of important factors appear again and again.
- Excellent communication at all levels within both organizations.
- Professional literature, CD&’s, Web Sites and technical specifications, keeping pace with technology.
- High quality sample program.
- Well thought out advertising program.
- Development of new innovative products.
- Outstanding in house technical capabilities at all levels.
- Dependable, accessible and friendly Customer Service.
- Rapid product problem resolution.
- Prompt payment of commissions
In preparation for this column, I spoke with many manufacturers and Reps. It was very interesting to note that most high quality manufacturers and high quality Reps have very long standing relationships. It was also interesting to note that in most successful relationships the Manufacturer and Rep viewed their relationship as a team effort, collaboration.
One particularly notable quote from the President of a long time CISCA Member Manufacturer, “my favorite checks to write each month are the commission checks”, the company is one of the most profitable and fastest growing in our industry!
Highly qualified Independent Manufacturers&’ Representatives receive calls and faxes on a regular basis to represent new product lines. It never ceases to amaze me how many of these firms have virtually none of the key elements required for a successful representation of their product. It is very common to be told, “we are working on it, will have it next month, next year”. Usually the promises are not fulfilled and the company is puzzled why they have not had an impact in the market, and why they have a constantly changing Rep Salesforce.
Mutual respect, teamwork, honesty, and hard work. Familiar words but as important today as they were 100 years ago.
William L. Shannon CSI, CISCA
President of Shannon Corporation
Recipient of the 2004 De Gelleke Award