By Rieva Lesonsky
Hiring a salesperson can be a huge decision for a small business owner—mostly because it’s often a huge expense. Good salespeople can command premium wages, leaving you in a Catch-22 situation: You need that salesperson to increase your sales, but without the sales, you can’t afford to hire the salesperson. So what can you do? One way to get around this dilemma is by hiring a manufacturers’ representative (or rep).
Kind of like freelancers, manufacturers’ reps are independent salespeople who are hired by several client companies. They’re most commonly found in business-to-business industries, and will usually focus on a specific industry so they can develop expertise.
Unlike in-house salespeople, reps are paid on commission, which means you’re only paying them if they get results for you. And since they typically work from their own offices, you don’t have to provide equipment and office space for them.
Reps are a great option for a growing company, since they usually want to see some level of success before they take on your business. If you’re a local business trying to expand regionally or a regional company looking to go national, a rep can be the perfect solution.
How do you hire a rep? First, determine what you need, including what are of the country you want to sell to and what type of customers you are seeking. The more narrowly you can focus, the better your chances of finding a rep with that particular expertise.
Referrals from other business owners or buyers in your industry are a good place to start finding reps. You can also advertise for reps online or in trade magazines. Contact manufacturers’ rep associations such as The Manufacturers’ Agents National Association or associations for your industry.
A good rep may work for businesses in the same industry, but they should not work for directly competitive companies. Also make sure the rep has adequate time to focus on your products, and talk to references to get a feel for the person’s reliability and effectiveness.
You’ll need a detailed contract that covers your expectations, payment and when the relationship can be terminated. Reps are independent contractors, so the contract is essential in spelling out how you want them to perform.
Stay in contact with your rep regularly and do all you can to help him or her succeed. A good rep can be the linchpin in your growth strategy.
Image by Flickr user buddawiggi (Creative Commons)Google+