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Pros and Cons of Using Independent Sales Reps

Guest post by: Jeff Simon

Article Overview: Independent sales reps are a very important factor for any manufacturer needing to sell products. It is important to consider the factors when deciding whether or not to use sales reps. In deciding to use sales reps, you are trading some measure of direct control over the sale of your product in return for a large boost in market coverage over a short amount of time, as well as exposure to markets that would otherwise be difficult to enter.

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Pros and Cons of Using Independent Sales Reps

Independent sales reps are an extremely important factor for any manufacturer who wants to sell products to retailers. They can boost your business an amazing amount, but how do you know if manufacturer’s reps are the right thing for you? You’ll have to examine your business and determine your goals.
First of all, it’s important to understand how independent sales reps can help you. One of the most important things that a sales rep has to offer is their existing customer base. Sales reps have established relationships with their customers, and can quickly move related lines to market. Essentially, since they already know the customer, it’s easier for them to sell your product than it would be for you to do it yourself. Especially if you are looking to enter new territories, independent sales reps are one of the fastest ways to do it. You also have the added benefit of having the backing of a sales rep whose customers have an established level of trust with. If the customer has had good relations in the past with your sales rep, they’ll be confident in your product when your rep pitches it to them.
Independent sales reps tend to have fairly low overhead, since they require very little to sell your product. The direct costs associated with contracting new sales reps are essentially just those related to training them with your product, and providing the sales tools they need. They can also bring you new markets that you may or may not know about. Since most principals focus their direct sales efforts within certain industries or vertical markets, independent sales reps can sometimes bring in new applications for specific products within different vertical markets. Basically, they can open up your business in ways you may not have anticipated, due to their differing point of view, as well as their exposure to markets that you may have no experience dealing with.
With all that said, using manufacturer’s reps seems like a no brainer, right? Well, there are a few disadvantages as well that you need to be aware of before you decide to start placing your sales reps. First of all, you won’t have direct control of the activities of any sales rep that is selling your product, short of simply terminating your agreement with them. It can also sometimes be difficult to keep track of them. Because of this, you want to make sure you’re very clear with your agreements with your sales reps. While you don’t want to assume that sales reps will try to take advantage of you, you need to make sure that you’re covered in case of any mishaps. When giving an unaffiliated person the right to distribute your product, you need to make sure they will represent you in the ways you want them to, as well as make sure they take good care of your samples.
In addition, independent sales reps represent multiple principals. While this is part of their strength, allowing them to sell related lines to retailers easier than selling only one product, it also means that your product will not receive 100% of their attention. As with all businesses, there exists a minority of independent sales reps that will perform the majority of sales. As a result, it can be hard to find reps that will be productive for your business. But this should not make you lose hope. All it means is that it’s important for you to have a good method for getting in contact with sales reps.
In short, while working with independent sales reps can have some barriers to entry, the potential gains far outweigh the risks. Independent sales reps are one of the most effective ways to build your business.

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Home > Sales > Jeff Simon > Pros and Cons of Using Independent Sales Reps >
Article Tags: increase your sales, independent sales rep, manufacturers reps, sales agency

About the Author: Jeff Simon
RSS for Jeff's articles - Visit Jeff's website

For over twenty-five years, Jeffrey Simon has been professionally active in financial management, information systems management, software development, and project management. Most recently he has been a founder and principal owner of RepHunter, Inc., a successful startup conducting business over the Internet. During the last two decades he has been employed by GE Capital, and has consulted for clients including American Express, CIGNA, IBM, and Xcel Energy. He has conducted advanced technology training in the international enviroment, including seminars attended by representatives of the U. S. Government, the Canadian government, the British government, NATO, Boeing, DuPont, Exxon, General Electric, Grand Metropolitan, Hewlett-Packard, IBM, Monsanto, Siemens, Westinghouse, and numerous other major corporations. His recent interests include the application of artificial intelligence to analysis of the stock market. Jeffrey was graduated from the University of Minnesota Summa cum Laude in Mathematics, and holds an MBA from Pepperdine University. He may be reached at jas@rephunter.net.

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