division for sales agents

FREQUENTLY ASKED QUESTIONS

 

What is an agent/agency?

Besides sales, what other functions does an agency perform?

Why would a manufacturer use an outsourced field sales force rather than direct sales? 


How does one become an agent?

How does an agent get paid? 


How do I find an agency?

What are some of the advantages of selling through an agent/agency?

 

 

What is an agent/agency? 
An agent/agency (sometimes referred to as a manufacturers' representative) is an independent business comprised of sales professionals acting as an independent proprietor, partnership or corporation representing two or more related and usually non-competitive products in a defined territory. An agent/agency is compensated primarily on a commission basis for goods shipped or billed from the manufacturer represented.

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Besides sales, what other functions does an agency perform? 

The agent/agency may also supply other valuable services such as trend analysis, credit reports, market research and market development information, sales analysis, new product development, customer service, demonstration, product quoting, product/sales training, and current product improvements.

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Why would a manufacturer use an outsourced field sales force rather than direct sales?
 

By representing several manufacturers, an agent/agency increases the effectiveness and cost-effectiveness of the basic selling function.  Multiple line selling creates a synergistic effect. A broader, better defined customer base provides more complete coverage resulting in deeper market penetration and increased sales. An agent/agency reduces the cost of selling since single visits can provide sales coverage for many products and ultimately save the retailer’s precious time. 
An agent/agency is paid by commission and, therefore, only for results. Manufacturers, who want to reduce or stabilize sales expenses relative to product sold, can turn to an agent/agency to perform or augment their sales function. An agent/agency pays his own expenses. A manufacturer avoids the need for an in-house sales force traveling to many independent accounts, which can be both cost and time prohibitive.

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How does one become an agent? 

Many who become agents begin with an already existing agency.  An agency looks for people with personality and skill sets appropriate to a good sales person. Among qualities an agency seeks are the ability to get along well with people, a positive attitude in the face of rejection, the ability to manage time well, a good work ethic that includes follow through and mastery of product lines and a deep respect for customers.
 Because many agencies specialize in a particular sports area, agencies often look for a passion for that sport. A person who was a varsity sports player in college or high school may make a good fit for an agency that specializes in athletic goods. A good skier or camper may fit similarly for agencies specializing in winter sports or wilderness outdoors. An background in retailing is also a plus. A person who has worked in sales or management in a sporting goods store or specialty sport shop brings a useful perspective to an agency.

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How does an agent get paid? 

Typically, an agent/agency receives credit for all sales within its territory, and receives a commission for these sales through a mutually agreed upon written contract with the manufacturer. An agent/agency is paid only after the sale is made. The agent/agency pays for the costs to select, train, compensate, discipline and terminate their own employees, reducing the legal exposure of manufacturers.
 A sub-agent (one who works in an agency other than as a partner) often works on a draw against commission. He/she must cover expenses which might include auto, phone, computer and travel expenses (including food and hotel expenses). Depending on the size of territory, expenses might range between $12,000 and $25,000 per year.

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How do I find an agency?
Using this website, you can search for agencies by territory or by product line, or by both.

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What are some of the advantages of selling through an agent/agency?
    •    Multiple line selling creates a synergistic effect. Having a better defined customer base with more 
         complete coverage, an agent/agency can achieve deeper market penetration and increased sales.
    •    Sales costs are known. An agent/agency is paid based on results.
    •    An agency provides manufacturers with a well-educated sales team highly invested in industry 
         programs.
    •    An agent/agency has local acceptance. Agents are familiar in the sales territory and trusted by 
         their accounts. Since they are not transferred from territory to territory, they have a vested interest 
         in their products and customers.
    •    An agent/agency provides important feedback through consultation on end user/customer 
         applications, trouble shooting, specification and product packaging. Should a problem arise, many 
         accounts feel it is easier to get in touch with an agent/agency if it is local.
    •    An agent/agency provides quick entry into the market because there is often a strong relationship 
         between an agent/agency and the account, knowing not only those responsible for purchasing but 
         also other decision-makers within the business.
    •    Because of familiarity with accounts in their territory, an agent/agency is able to identify accounts
         into which new products can be introduced and sold.
    •    Interfacing with accounts, an agent/agency can provide more objective evaluation and account 
         feedback of new products or ideas for improving existing products.
    •    An agent/agency provides information and support to dealers and end users through product 
         know-how, employee training, field and test demonstrations and consultative selling.

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