How Do Sales Reps Work?

The holiday season is an incredibly busy time for us — and probably you.  So in lieu of writing a brand new post, I want to post excerpts from one of my most read articles:

WHAT ARE SALES REPS (representatives)?

Independent commission-based sales representatives, more formally referred to as “manufacturers’ representatives,” or more commonly, just “reps”, are a dominant force in many industries, and especially the wholesale gift industry.

Unlike wholesalers or distributors, who take actual possession and ownership of merchandise at discounts from the wholesale price, sales reps are a contract sales force representing the company or companies they work for. Typically they are paid a percentage of the wholesale price on the accounts they open, or to all accounts in their exclusive territories, the month after an invoice is paid by the retailer (wholesale account).

It works like this:

  1. Reps travel (and/or run a showroom in a gift mart) and present merchandise for the lines they represent.
  2. If an order is taken, the information is forwarded to the manufacturer, who then ships the merchandise, subject to the manufacturer’s terms and conditions.
  3. After payment is received, the manufacturer then cuts a commission check to the rep, usually the month following payment.

Standard commission rate in the gift industry is 15%, although some companies pay more or less than the standard amount.

Sometimes distributors also hire reps, although usually, the commission rates are lower, in the 10 to 12.5% range. Because distributors carry a lot more products and usually offer catalogs and other sales materials, the lower commission still results in excellent income to the rep, due to larger average orders.

For gift shops, purchasing from a rep offers many advantages, including:

  • You get service right to the door of your establishment, and a dedicated advocate if there is a problem with your order or customer service issue with the manufacturer.
  • You never pay more for the onsite services of a rep, the wholesale costs are the same. If you find that a company is trying to get you to go around the rep for a lower price, you are working with a disreputable company, and you should contact your rep immediately with the information.

On the other side of the coin, retailers who try to go around the rep, and request a better deal, are operating unethically.

Remember that sales reps, just like employees and spouses, vary widely in commitment, follow-through, and service. Please give your rep a chance to serve you before making snap judgments based on a lousy past experience.

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What Exactly Does a Sales Rep Do?

Your products are selling great at the store where you have your wholesale account, but you are overwhelmed with keeping up with or developing more accounts for your line.  Maybe it is time to hire a sales rep ….

The job of a rep is basically to “represent” the manufacturer’s, distributor’s, or importer’s line of products to prospective buyers, and make sales. Those buyers are typically retailers, but may include wholesalers, distributors, or service businesses as well, depending upon the industry and/or product line.

As part of their service, reps call on prospect businesses and present What Exactly Does a Sales Rep Do?the client’s products in a positive light (as a way to solve the buyer’s marketing needs). Effective reps must answer product questions intelligently; offer promotional materials, terms and other information; and ask for orders and re-orders in person, or by phone, fax, or email (and increasingly, via their own web sites – mine is at Idaho Gifts Wholesale if you want to see what I do).

Sales reps exist (somewhere) to target virtually every size of retailer from small mom-and-pop stores to large “big box” retailers, including chains. And of course, reps usually specialize in either the product lines they sell, and/or retailer categories they call upon.

In the gift industry, reps want to show profitable standbys, PLUS they need some of the newest, and most attractive or innovative products on the market.  Reps maintain the face-to-face contact with retailers, and make it easier for retailers to trust and try new lines.

Good sales reps work hard and perform many behind the scenes tasks such as the following:

  • Research stores to see if their vendors’ products will complement the current inventory
  • Call on stores numerous times if necessary, to generate an order
  • Spend a large amount of time on the phone, on the road, or in their showroom presenting products, answering questions, and finding just the right combination of products to sell to their buyers.
  • Take care to organize and follow up on leads they receive
  • Manage a large amount of information on their vendors and products along with information on store buyers – including their buying preferences
  • Make sales appointments – which buyers may or may not keep – and still maintain an upbeat attitude in the process
  • Keep track of vendor’s inventory while in the stores in order to make order recommendations and alert their vendors if there is buyer resistance and low inventory.
  • Process orders for their vendors in a timely manner
  • Maintain numerous customer databases, customer management records, bookkeeping and other paperwork

How to Find Recruit and Manage Sales Reps 75 x118

 

If you are interested in learning more about working with sales reps, check out my best selling eguide:  How to Find, Recruit and Manage Sales Reps

Working with Reps in the Fashion Industry

Several readers have asked about working with reps in the fashion industry.  Since I work don’t really work in the fashion industry (I don’t think selling souvenir t-shirts counts!), I did some research and come up with a few resources for my fashion friends.

First, I found this wonderful video on What a Fashion Rep Looks for in a New Brand:

 

The information in this video reflects important tips for most any product!  Good photography and professional materials are important for selling any items wholesale!

NOTE:  Make sure to check out some of the other videos listed on the right of this YouTube video (above).

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Another great resource is my industry friend, Jane Button. Jane is an expert in the fashion industry and has many great resources for you.  Here are a couple of her articles on hiring a sales rep in the fashion industry:

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Jane Hamill is also a fashion expert. On her website, Fashion Brain Academy, Jane describes her goal:

My goal is for every designer to make a living using their creativity while becoming business savvy – even if you hate sales and cringe at the idea of a marketing plan.

In her blog, Jane has a wonderful article called Are You Ready for a Sales Rep for Your Clothing or Accessories Line?  In her article, Jane mentions her mini workshop on how to find a sales rep for your clothing or accessory line that looks very interesting and informative!

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More great information I found was a three part article The Entrepreneurs Guide to Sewn Product Manufacturing
on Contracting for Clothing Sales Rep written by Kathleen Fasanella.  Heavily referenced in this article is her book called The Entrepreneur’s Guide to Sewn Product Manufacturing.  Although the book was written in 1998, folks are still using it as one of their guides in starting and working with reps in the fashion industry. (You might also check out Kathleen’s blog, Fashion Incubator, to access her extensive resources.)

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Last, but not least, here are three rep matching organizations that specialize in fashion sales reps.  If you are truly serious about selling your fashion nation wide, I would highly recommend joining one of these group.  The contacts and information you receive will be invaluable:

  • The Apparel Marketing Group
    We introduce manufacturers in the fashion industry to the right apparel sales reps in all the major markets of the USA.
  • Find Fashion
    We contact the 1000 mult-line independent sales rep in the database semi-annually to verify and update all company information.
  • Rep Hunter — Apparel
    RepHunter connects Principals and Sales Reps in the apparel industry with one another to increase the effectiveness of the sales process and save valuable time and money on the part of each.

 

 

Working with Sales Reps from a Sales Rep

If you have not already heard, I recently became a grandmother!  I am currently away from home visiting with my grandson and visiting with my daughter and the baby’s father.  Little Dante is the cutest little guy!  I am thoroughly enjoying my time with him!  Since my 28 year old daughter is “my baby” it has been a long time since I have spend to much time with an infant!

Today, I am sharing an past article on working with sales reps.  I hope you enjoy it!

After working for nearly twelve years as an independent sales representative to the gift industry, I could share plenty of interesting stories about producers and gift shops.  I doubt that I have “seen it all”, but there are some pretty interesting stories to be told!

Salesperson 2All and all, I have loved working as a gift rep with both producers and gift shops.  Actually, I love the retail environment from every angle … so many interesting things and people to deal with!  But being a sales rep, has put me in a position to help new or seasoned producers see their business in a different perspective.

I would like to share some tips on what to do or not to do when working with your reps – from a sales rep’s perspective:

1.    Treat your rep as your sales and/or marketing partner.  They are out there to help you make sales, not to compete with you!

2.    Pay your rep promptly and accurately.  Nothing will de-motivate your rep faster than going months with being paid.  Selling your products is what they do for a living and they need to be paid  – just like you would pay your employees.

3.    Try to follow up with your rep in a timely manner when he or she calls for information – most likely the request came from a potential buyer.  They longer you take to get back to the rep the less likely they will be able to close the sale.

4.    Be generous with flyers and sample.  Once again, these items are probably requested by a potential buyer.

5.    If you receive an order direct from the customer, don’t assume the rep is not doing their job.  Many buyers will order first time from a rep and then prefer to order direct from the company.  Or maybe the rep stopped by with the information and potential sale, but the buyer calls you instead.

6.    Be honest and upfront with your rep.  If you plan to hire someone else to cover some of their territory, for example, talk this over with your current rep.  It is de-motivating for your sales rep to find out sensitive information such as this from your customers.

7.    Be timely with price or product changes.  If you inform your customers about your changes and forget to tell your rep, you will make your rep look misinformed about everything in your line.

8.    Don’t be afraid to have a written agreement with your rep.  I have found that “good fences make good neighbors”.

9.    Give your rep(s) as much information as possible about your potential customers (if they are servicing your house accounts).  They more they know, the better they will sell for you.

10.    If you have a problem with a customer, make sure to talk this over with your rep.  They may be able to help you.

These are just a few tips – from a sales rep’s perspective – on hiring and working with sales reps.  As you continue growing your business, I am sure you will find more items to add to the list.

How to Find Retailers and Sales Reps Lists

 

I have received several requests from readers asking about lists for different retail buyers, sales reps from various industries, and media list to promote products – especially for the holiday season.

Although I personally, have not compiled such lists, I have friends in the industry that have.  Lists can be one of the fastest ways to increase your sales – whether they are lists of stores, sales reps or showroom.

Andreea Ayers, from Launch, Grow, Joy has compiled several list of retailers (each list contains 500 to 1500 stores) in the following categories:

  • Art Galleries
  • Baby & Kids Boutiques
  • Eco Friendly and Fair Trade Stores
  • Fashion, Apparel and Accessory Boutiques
  • Gift Shops
  • Hair Salons
  • Home and Garden Stores
  • Independent Books Stores
  • Spa and Spa Boutiques
  • Stationary and Paper Goods Stores
  • Yoga Studios and Boutiques

Click here to purchase one or more retail store lists!

 

Another industry leader, Don Debelak, has compiled lists of sales reps in 16 (and growing) niche markets.  His lists are for the following categories:

  • Baby and Children’s Products — a list of over 180 sales reps for children’s market
  • Convenience Stores — a list of over 90 sales reps and distributors
  • Kitchen Reps — a list of approximately 200 sales reps
  • Pet Product Reps — a list of over 100 sales reps
  • Gift Reps — a list of approximately 200 sales reps
  • Promotional Products — a list of over 120 sales reps
  • Mass Merchants and Drug Stores — a list of 100 sales reps
  • Toy and Hobby Products — a list of over 120 sales reps
  • Office and School Supplies – a list of over 80 sales reps
  • Outdoor Products — a list of over 400 sales reps
  • Christian Products — a list of over 100 sales reps
  • Kitchen Plumbing Fixtures — a list of over 150 sales reps and over 30 catalogs for the kitchen market
  • Hardware Market — a list of over 170 sales reps and articles on selling to the hardware market
  • Automotive Market — a list of over 160 sales reps
  • Lawn and Garden Market — a list of over 120 sales reps
  • Marine Market — a list of 90 sales reps

Click here to purchase one or more sales rep lists!

 

In addition to the sale rep lists, you might want to look at the lists of Showrooms compiled by Andreea:

  • Baby and Kids Products Showrooms
  • Fashion, Apparel and Accessory Showrooms
  • Gift, Home and Garden Showrooms
  • Stationary and Paper Goods Showrooms

Check here to order one or more showroom lists!

Using lists is a quick efficient way to increase your business.  The sources above a reputable sources that I personally recommend.