Manufacturers use representatives for several reasons.

  • Reps have local geographic advantages. They know the local territory and have a rolodex of customer contacts. They carry complementary lines and are able to introduce your parts to existing customers.
  • They are owned and run by entrepreneurs, which may be better in some cases than having sales team members as employees on your team

  • They are paid a commission contingent on actually getting the business, thus lowering the cost and risk of building your own direct sales force.

Top 5 Techniques for a Productive Relationship with Reps and Distributors

However, there are several challenges:

  • The first is mindshare. Unless you are one of the top 3 lines on the line card, you will have a tough time getting enough rep mindshare. This results in problems ranging from overlooked or lost design opportunities to a lack of product knowledge and poor competitive performance.
  • Another problem is sales management. Reps are not your employees and there is a limit on directives that you can give them and the degree of compliance that you can expect.
  • Another problem is that reps get paid when the business is booked; and with transfer business, the production region is often not the same as the design region. If you are not tracking this well and transparently, the rep may not have visibility to his rewards for work he has done for you; which is demotivating.

Top 5 Techniques for Productive Reps and Distributors

Pay them on time

This sounds simple, but you will be surprised how many companies don’t do this. Are you one of them? Paying them accurate commissions on time should be your first priority. Companies that do not pay on time or pay incorrect amount, spend lots of time chasing disputes and end up demotivating people. Transparency in commission payouts can build trust and boost productivity.

Show them the money

Are you motivating your Reps and Distributors? People are inherently motivated by money and the transparency of the pipeline can boost morale and lift productivity. Reps and Distributors only get paid when the business is booked. In addition, Distributors stock their shelves which involves an upfront investment. Showing them the money appeals to their competitive spirit.

Lead from the front

Are you managing the sales team effectively and coordinating the activities across regions within your customers? Do you have an efficient way to route leads, follow-up on sample requests to convert them into opportunities? Do you approve Design Registration early in the process, so you don’t have two distributors chasing the same business and undercutting you own margin? All these are important, unless you like competing with yourself and bringing down your own margin.

Have a transparent and fair, yet secure process

Having a fair and transparent process can build trust and boost morale. Do not share one Rep’s data with another Rep or one Distributor’s data with another Distributor. They should feel their customers are not reassigned and the commission due is paid in a timely fashion.

Recognize that you get limited share from your reps and distributors

Typically, Reps and Distributors carry multiple lines and it is quite possible you may not be their biggest line. So plan accordingly and develop simple and efficient processes since their attention is divided. Ask them to enter what is important and necessary and not just enter data for the sake of it. Provide a way for them give feedback and compare their mindshare for your line as opposed to other manufacturers. Develop training, collateral and presentations on your products and have them easily available so they are well informed and trained to sell your product and not spend countless hours chasing you to get some presentation material.

System and Process to Manage Reps Effectively

NEHANET consists of a complete set of modules that allow you to manage all aspects of your rep interaction effectively from a single ‘rep’ portal or application. You can choose which of the following you wish to enable, depending on the particular circumstances of your business and of your relationships with your reps. To learn more about how you can improve and tighten up your current system, talk to us for a complimentary discussion to see the dynamic interrelationship between the 30 key sales and marketing process that differentiates the winners from average run companies. If you already have a system in place, we offer a dollar-for-dollar credit on the subscription fee for the remainder of the contract term for your current system.

Not managing Reps is expensive

Many manufacturers who manage thru reps do so in a very informal manner. Regional Sales Managers communicate with reps using emails and phone calls.

Design opportunities and forecasts are tracked in excel. Quotes and samples are requested by emails. Quote logs are kept in excel and approved quotes are often just word documents or excel forms. Shipment and backlog data is sent back and forth in excel via email.

Informal communication of this kind results in sub-par competitive performance. It is not possible to do meaningful win-loss analysis and manage the team effectively. Consolidating data and running reports is time-consuming and error prone. In addition, there is a serious security risk in having many versions of excel spreadsheets with sensitive sales information being emailed back and forth inside and outside your company.

Managing Reps is expensive

Component Manufacturers have tried different approaches to managing reps in a more systematic way, ranging from Access and other home grown database programs to deploying different CRM systems which may have been customized to differing degrees.

These approaches do not succeed as expected for one key reason – reps are not your employees and their interests and yours diverge on what information must be shared, by whom, and how often. Most common commercial CRM systems are more of the “contact’ management variety and lack the sophistication to handle the above complexities effectively.

In addition, many reps first track and manage their own business in a system like RepCRM and then have to satisfy the different reporting requirements from all their principals. Naturally, this reduces their desire to spend a lot of time on any one particular system being used at a manufacturer. It is vital that the emphasis be on “process automation” and focusing on simply helping reps get what they faster and easier, as opposed to productivity improvement, more management and more work for the reps, but it is surprising how many manufacturers do it incorrectly.

The bottom line is that a lot of money gets spent building and customizing software solutions for what often turns out to be mediocre adoption, poor data input, and less than satisfactory business results. Fortunately, NEHANET has invested millions of dollars building NEHANET so you don’t have to do the same.

Managing team communications

Your reps are spread over different geographies and time zones and give you limited mindshare. It is vital to streamline inbound and outbound communications. A “home page” that can be tailored by role and regions empowers you to get your vision, strategy and tactical directives out to the reps efficiently. You can also capture the “process directions” for reps, i.e.: how they should use the system and what they should expect in return from the system.

Example of a Home Page of Reps
Report of Leads older than 2 weeks

In addition, you can easily setup “management by exception” reports that highlight specific areas where reps may not be completing tasks per your expectations. For example, you may require that reps qualify or reject new leads within 2 weeks. A Global Report that shows reps the leads they have that are more than 2 weeks old is a simple way to help reps comply with your expectations. Ideally, these reports would show No
Results if everyone uses the system per your expectations.

Requesting and managing sample requests

Reps have an easy web based form where they can request samples. You can have them update the project or opportunity information as part of doing so. Your regionals can review and approve the sample requests. You can then notify the reps when the sample has shipped. More importantly, you do not want to be in the “free sample shipping” business, and you can use the system and this process to ensure that reps follow up with the customer properly on sample requests.

From the reps perspective, using an online system is easier than sending emails and having to track the status of different sample requests in Outlook or Excel.

Sample Request Grid View

Requesting and managing quotes

Similarly, you can provide your reps with an easy to use intuitive system to quickly request quotes which can then routed for approval if needed, depending on the quote rules that you have defined. From the reps’ perspective, they will have an online quote log that they can refer back to. They will get notifications from the system once the quote request has been approved. They will also be able to rapidly give the customer a professional quote on your paper with your standard terms and conditions.

You benefit from having a streamlined process — from being able to track quotes that your rep may give the OEM today and which you will need to refer to six months later when a CM may ask you for a quote for the same business.

Quotes Log Grid View

Managing trip/visit reports

Instead of having your reps type up and email in their customer visit reports, you can give them a standard and easy to use interface to send in trip reports. These trip reports are saved and are easily accessible for future reference. In addition, your reps or more likely your regional can create action items as they
relate to specific trip reports and assign these action items to particular individuals.

Having this information online and actionable is far more effective than having emails being sent around and around.

Trip/Visit Reports View

Managing opportunities

Reps are contact and action item oriented, and many of their opportunities are shared across multiple manufacturers, including you. They find it cumbersome to manage their own pipeline and then to provide you with periodic updates. You can instead provide them with an easy to use web portal where they can export their data with one click, make all their changes and export it all right back, without having to spend a lot of time and energy on the system. Their resistance to using the system goes down and the quality of your data goes up.

From the reps’ perspective, they can now easily track transfer business and keep track of the production locations for the designs they won for you. This helps them track their commissions and makes them more motivated to sell your products.

Opportunity Summary Grid View

Managing forecasts

If you are already sending out forecast spreadsheets in excel format to your reps once a month; then the NEHANET system will make a significant improvement to your process.

Forecasts are entered in only once and are then rolled over. Reps have access to their backlog and shipment data and can enter in their billings forecast (and bookings forecast if you so desire) with those numbers in mind for improved accuracy.

You get real-time forecast data updates with the errors and time taken with the excel model and can now easily run reports comparing actual shipments and backlogs with the billings forecast to get a better handle into your business.

Monthly Volume Report of Constrained Billing Forecast by Region by Part Number

Communicating shipments/backlogs

Instead of sharing backlog and shipment information with your reps by sending them an excel spreadsheet once a week with their data, you can now load in the information just once into NEHANET (or use our Data Integration Framework for real-time integration with no data duplication)

Sales History Grid View
Sales History Detail View

Your reps will have the latest backlog and shipment information at their fingertips, including customer request vs. commit dates and ship date details.

This will allow them to add more value to their interactions with your customers, which is ultimately good for your business.

Managing shared contacts

Reps view their rolodex as the key asset that they bring to your business and are often reluctant to
share it with you. You, on the other hand, want to capture the key contacts in your system, so that if there is a turnover in your rep sales force for some reason, that at least the emails and the contacts are
preserved for your use.

NEHANET makes it easy to load, manage, and share contacts between you and your reps. In addition, the system archives all outbound emails if required; and this provides an alternate method to store and keep track of key business contacts.


A single system improves efficiency

By giving reps a single place to interact with your Company, you make it easy for them to request samples and quotes while checking on the status of their earlier requests. They can check shipment and backlog status, submit forecasts, enter trip reports, and check their commission reports.

You also have a single system where you can information on many aspects of your business operations, where you can run reports, communicate with the team and make smarter and faster decisions. A single system saves time and makes finding information easier for all involved.

Effective communications drives sales results

A cohesive, well-coordinated team firing on all cylinders can make an immediate impact on your sales performance. Having integrated communications tools like home pages, dashboards, email alerts and more is a great way to get the business process automated and to drive communication at the same time.

RSMs can manage reps effectively

Instead of the reps emailing your RSMs and having your RSMs do data entry work, you can now make both productive. Reps need only enter information as and when needed thru an easy to use interface; and RSMs are freed from data entry, which allows them to focus on what they should be doing – managing your rep sales force.

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