This will most likely be a short post. I don’t have much bad to say about reps in general. As with all things in life, there are some bad people out there who happen to work as a rep. But don’t let that color your judgement on all reps.
The main bad thing said about reps is that they cost money. Well, Duh. Of course they do. And I’m glad they do.
Since reps work on a commission of actual sales, they are a variable cost in the business. When your company is small and just starting out, that variable cost is small. Being small, it helps your company grow faster and less expensive.
The problem seems to come when companies have success and grow to many millions of dollars of revenue in a reps account – then the variable cost becomes a larger dollar amount. And that tends to draw the attention of financial types back at HQ.
So, I put the cost of reps down here as a bad thing only because I have seen too many times where that variable cost, while a small percentage number, can add up rather large dollar amounts…
A second and less talked about potential bad side of using a rep is lack of bandwidth. Since reps are paid on sales, and they are human, attention and effort tends to go towards the companies that are selling, growing, and show long-term potential. When you are starting out, you may get great attention and feedback from your rep and you may think of them as your new best friend. However, if the initial meetings with the retailer don’t go perfect and roadblocks are put up, you may find that your new best friend doesn’t call back quite as quickly any more.
This is where a good account manager or director of sales can really extend the leverage of rep force in the field. It is their job to stay on top of and continue to motivate the rep, even while the company or product is in a development phase.
Keeping mindshare of a rep force is one of the largest battles that most start up manufacturers have to face. However, if the manufacturer is making quick progress at knocking down the objections of the retailer and is basically doing the things that they should be doing, then they will naturally create momentum that will keep the rep and all interested parties engaged and positive.
Overall, I am a fan of using reps and the ideas discussed above do not detract from my stance.
Anyone out there who doesn’t like using reps, or wants to add any thoughts to the ‘bad’ side of reps?
Matt Gorski 