Gift Rep Sandy

The saying “Time is money” is especially true for sales reps!  Anywhere you can save time in one aspect of your business leaves more time to make sales.  Listed here are a few of tips to help you save time and money in your business:

1.    Stay with family and friends whenever and wherever possible.  Motel costs can add up in a hurry.  Staying with family or friends saves you money, and also gives you a local contact person to help with directions, store referrals and familiarity with your territory.

2.    When possible, pack quick snacks to eat on the road.  Packing snack foods such as trail mix, granola bars, nuts or jerky are a good source of energy food when you don’t have time to stop for lunch.  (Ever gotten that last minute phone call rescheduling an appointment right during your lunch time?)  Packing a cooler with a good supply of water or your favorite canned beverage is also a good money and time saving trick.

3.    Prepack your suitcase with a complete set of products you use daily. Include a pre-packed set of make-up and toiletries, refillable shampoo or lotion bottles, vitamins, pain killer and any products you use on a daily or weekly basis.

4.    Keep maps of your territory in your vehicle.  Packing a general state or region map along with detail maps of the larger metropolitan area are can save a time when trying to locate potential buyers.  I found using maps is MUCH MORE effective then asking a local resident for directions who can ultimately give you bad directions and tell you, “You can’t miss it!”

5.    Keep a detailed customer and vendor contact list handy.  If you use Microsoft Access for your database, you can easily sort and print out lists by sales route.  Using printed lists with complete contact information saves time and aids your memory when contacting or visiting your customers.  No more embarrassing moments trying to remember the buyer’s name!

You will learn plenty more time saving tricks along the way as your continue to work your business.

Building a Livable Income.  As a rule of thumb, it takes 2 – 3 years to build and refine a customer base and vendor products lines needed to sustain a livable income.  Following is an outline of income potentials to expect in the early years:

•    The first 6 months to a year will be a major cash drain as you will be spending money on travel and tools to generate potential buyers and orders, but may not be receiving enough commission payments to meet those costs.

•    The second 6 months to a year will give you enough income to meet most of your business expenses.  If you have done well, you will break even somewhere during this time frame.

•    Sometime during your second year, you can expect to generate enough orders to pay your business expenses and make a ‘bare-bones’ living.

•    If you have worked consistenantly and persistently over the first two to two and a half years, you should be able to sustain a fairly good group of loyal buyers and producers to provide a sustainable income for your efforts.

One major advantage of sales repping over other start up businesses is the low start up and overhead costs associated with this type of business.  Whereas, most new businesses require a large cash investment for products, office and equipment, sales repping requires only a car, business card and your dedication to working the business!  But as with any start-up business, planning for the ups and downs of cash flow will make or break your business.

Positioning Your Sales Representative Business, although not an open conflict situation, is important indicator to the way you are treated within the sales channels.  Not only do you need the trust and respect of your vendors, you also need the trust and respect of your buyers.

To position your services as one of the players in the marketing channels is very important.  You can loose value to your buyers if you seem to be an outsider playing in or during the buying process.  Listed here are a couple ways to encourage this positioning:

•    Treating each sale as though the buyer is purchasing your personally manufactured products.  In other words, you are taking ownership as a sales partner with each vendor your represent.  After all, these are not abstract products you are representing.  They are products and companies you care about.

•    Showing your buyers you bring value to their buying experience.  If you give your buyers the best service you can give, they sense your dedication and see your value.  Also, buyers are more likely to order with you, as someone they know and trust, rather than ordering direct from the vendor or from another sales rep.

One of the more frequent questions I receive, especially from smaller stores who are not familiar with working through a sales rep, is concerning price structures.  “Will this item cost me more if I buy though you?”  Because distributors often charge a high price for products they distributor and deliver, some buyers assume that a sales rep’s position is similar.  Also, many buyers are unaware that the producer is paying the sales rep to service their account.  (I think buyers are conditioned to be skeptical about getting something for nothing!)  Personally, I needed to educate some of my buyers about my role and relationship between them and the vendor – stressing that I am a service company working to make their buying experience fun and easy.  Once again, I reinforced my role in the marketing channels.

This concern can also be an issue you need to sell to your producers.  Many start-up companies especially, may not understand your important role in the channels of distribution.  Producers have told me:  “Why should I pay you to sell my products when I have done all the work?”  This question tells me they do not understand the gift market nor understand the value my role is within that market.  After all, it takes several years to compile and develop relationship with buyers from dozens or even hundreds of gift stores.

More selling and marketing conflicts:

Selling through Distributors vs. Direct Lines Sales Conflicts occurs when representing an individual producer whose products are also offered by the distributor you represent.  In order to have greater coverage of their product line, a vendor may agree to have a distributor, who services a large region, offer their products.  Distributors often pay a lesser commission than direct line or ‘sub-rep’ sales, but on the other hand, a distributor adds new lines and products to your offerings.

Show Rep to Territory Rep Conflicts occur when one rep has a certain territory, but a buyer from that designated territory buys product at a gift show held in another territory.  Producers often have reps in other areas who may exhibit at gift shows in their region, and buyers often visit gift shows in different areas to find new and unique products for their store.

Website Rep to Territory Rep Conflicts, similar to the show rep vs. the territory rep, occurs when one rep has a website and sells to a buyer in a territory serviced by another rep.

Vendor House Accounts vs. Territory Rep Conflicts.  If you are a sales rep who services your territory very thoroughly, it is common for a vendor’s house account to want to buy from you.  You are already in their store taking orders for other lines, so the buyer finds it easy to place orders for producers who consider them as house accounts.

Vendor Product Conflicts.  When represented numerous different product lines, conflicts happen with your vendors concerning specific product lines.  Most common conflicts can include the following:

•    Product overlap between vendors
•    Exclusivity of products or product lines

Gift Stores vs. Mass Market Conflicts.  As noted in early chapters, gift stores are upset when a product is found both their store and in a mass market outlet.  By nature, gift stores like unique products with high-end packaging not found in other retail outlets.  If a consumer sees a item in a large chain store, discount outlet or grocery store chain, it changes the perception of that product from a unique item to one that is purchased anywhere at anytime.  A gift stores do not wish to portray this kind of image to their customers!

Listed below are some of the conflicts you can encounter during your sales repping of various different companies

Rep to Rep Conflicts occur when a producer hires two or more reps having overlapping territories.  If a producer decides not to designate an assigned or exclusive territory to their reps, this is a common occurrence and causes conflict when trying to determine which accounts belong to which rep.

Rep Group to Independent Rep Conflict occurs when a producer is interested in having a larger rep group, who covers several states, represent their products rather than hire an independent sales representative.  Although, at first glance this solution looks like a better option for the producer, I found larger rep groups generally don’t saturate the territory like an independent rep.  In other words, if a sales rep travels from one sales territory to cover another territory, they often ‘cream’ the region by servicing the large accounts and neglecting the smaller remaining profitable customers.

Wholesalers/Distributors to Rep Conflicts occur when a wholesaler or distributor (or just distributor) is selling your vendor products in the same territory as you.  Even though, in the gift industry, a sales rep is normally a better sales force option for a producer, distributors are a matter of choice when there is no or little sales representation in a territory or region.  As noted from the definition listed above, distributors buy, inventory products and often deliver (or hires a rack jobber to deliver) within a predetermined sales route.  In this case, a gift store is forced to buy whatever stock the distributor currently has, but receives the purchased product on the spot.

While selling gift products, you have contact with many different marketing channels which will bring many different variables to your business.  Producers sell directly to stores or consumers, through you, the sales rep, through distributors and wholesales, or through gift shows and gift marts.   Before describing the different types of potential conflicts, let’s look at the different players involved in wholesale marketing:

•    Brokers: Similar to manufacturers’ representatives, but work almost exclusively in higher volume food markets such as grocery and food service. Commission rates of 2 – 5% which is generally much lower than for “reps”, due to larger volumes.

•    Distributors: An intermediary between producers and retailers, with large warehousing capacity and a sales and delivery force servicing stores in their area or region. Different from reps, in that they purchase directly in quantity, and take both ownership and possession of the products, for delivery. Distributors sell (often with the use of reps or brokers) and collect payments directly from the stores. Distributors are the dominant method of food distribution in grocery and food service.  Standard discount rate:  25-50% of wholesale price.

•    Manufacturers Representatives: Independent sales representatives, or “reps” who call on retailers in many categories to sell your products, and items from many other companies, on a commission basis, paid monthly. The producer ships, invoices, and collects from the retailers, who are the mutual customers of both the manufacturer and the importer. A dominant force in the gift, and aspects of the specialty gourmet industry.  Standard commission rate: 10-20%.

•    Producers, Vendors or Manufacturers: Names for manufacturers who choose to produce a product for a target market or markets.

•    Rack Jobbers:  A wholesale middleman supplying certain classes of merchandise handled by distributors such as snack foods, postcards, etc. The rack jobber commonly inventories display racks in retail stores, periodically checks the stock, and replenishes inventories. Also called a service merchandiser.

•    Retailers: Companies that – usually from a physical structure, but increasingly over the internet – sell products directly to end consumers and collect sales tax (where applicable) on the transactions. Some direct sales companies and other such organizations also fit in this category. Note the confusion of terms, since retailers buy at wholesale and sell at retail, which what makes them “retailers”.

•    Wholesalers: Similar to a distributor, EXCEPT they generally do not have a sales force or offer on-site delivery, instead shipping to retailers by common carrier from central warehouses.  Standard discount rate:  25-50% of wholesale price.

Many larger producers work through many different marketing channels that can conflict with your sales or sales territories.  For example, a specialty food producer may hire a sales rep to sell their products to a gift store and also hire a distributor to sell to other retail venues such as specialty grocery stores.  Or a producer may decide to sell direct to retail stores and consumers in certain areas and hire one or more sales reps to expand their markets elsewhere.

Selling and servicing web customers is very different from servicing gift shows in your territory.  Since the potential for receiving orders or inquiries from buyers is outside your travel region, you may never meet some of these buyers and the only contact they have with you is via your website.  Developing a relationship with these buyers is a challenge to the way you have done business.

There are several points to consider when selling to web customers:

• Web customers, outside your customer base, most likely found your website via a search engine.  You need to qualify them as buyers, so the Buyers Registration and Password Request Form need to be linked and displayed prominently on your site.  If you set up your website correctly from the beginning, customer should find this form easily.

• Web customers are strangers – you have not met them nor have you been in their store.  Because of the unknown factor, I highly recommend you process all orders via a credit card.  Most web buyers are accustom to paying for their purchases with their credit card, so this requirement should not be an inconvenience.

• The best way to develop and maintain a web relationship is sending out monthly (or at least quarterly) e-newsletters.  Emailing periodic information on sales and new products remind your buyers of who you are and what you sell.

During the four or more years I have maintained my website, I have gotten numerous requests from stores inside and outside my sales travel route.  When possible, I always tried to visit those stores within my territory.  Most buyers appreciated my extra efforts in doing so and would ‘reward’ me by placing more orders at that time.  In theory, my site also increased my customer base within my territory.  My website became a very useful tool in locating new stores, gift basket companies, and gift buyers that I may not find through traveling to their towns.

With a website, you have the unique opportunity to market outside the territory you visit.  Since there are no boundaries or restrictions to the number and type of buyers you attract via a website, the opportunities to increase sales and customer base is endless.

Best way to market your website to customers beyond your territory is through search engine optimization.  Most search engines rank your site by “hits” from potential visitors who are using certain keywords when they search.  When you develop your site, your keywords (which are ‘peppered’ throughout your copy) should list your niche market and specialty products as described above.

With the work done to accumulate and invite buyers to your site through the password request process, you have already drive traffic to your site.  With this established framework, potential buyers outside your territory can find your site easier than if there was no traffic to your site at all.  If there are no visitors to your site, it is unlikely you will rank very high in the search engines.

To jump start this process, submit your website information to the major search engines such as yahoo, goggle, lycos or msn. Even if you don’t manually submit your information, often search engines can locate your site through their “spiders” who are combing the content of new sites to add to their index

Other web based venues to get your name and products noticed is to list your company with web directories.  Directories, which are different than search engines, list your site by category similar to a yellow page listing. Often a search engine compile a directory with separate submission forms or requirements.

Researching and adding your site to active web blogs, Facebook pages and industry listservs also generate traffic and buyers.  Anytime you post on any active blogs, facebook page or listservs, adding your web URL in your signature is a subtle advertisement for you website.

Another method for driving traffic to your site is advertising your website and/or product offerings in trade magazines and journals.  Trade magazines such as Country Business, Gourmet News, Home Décor etc. are read by your potential customers.  Having advertising or listing in these magazines give you a wide exposure to retail stores across the country.

Many trade magazines also have industry mailing lists you can purchase.  Many magazines or organizations offer snail mailing lists or email lists which contain qualified buyers within the gift industry.

If you attend a gift show, add your web URL to all the information listing your company and products.

There are many options you can use to market your website.  Since you visit most of your customers during your sales trips, you have a golden opportunity to build traffic by telling every buyer you know about your site.

Other ways to market your website to your current customers is to:

• Add your website URL to EVERY flyer, business card, literature or correspondence you have with a buyer
• Encourage every buyer to fill out a Password Request form when you are visiting their store
• Hand out Password Request forms at any shows where you are exhibiting
• If you mail a hard-copy newsletter to your customer, makes sure to give detailed instructions on how to access and request a password to your website
• When ever you receive a request for catalogs or flyers, refer your buyers first to your website
• Encourage your vendors to refer potential customers to your website
• Leave Password Request flyers with organizations or agencies that may work with potential buyers
• Tell everyone you know about your website!

With the Password Request system described above, you promote traffic to your site by emailing potential buyers a password.  Most buyers are interested in your site, and will view it after you send them a password.  This system is the beginning of your web traffic!  Rather than waiting for buyers to come to you, you are inviting them to your site.  As time goes on and more buyers are accessing your site via the passwords you issued them, the higher your ratings climb on the search engines.  And the higher your ratings on the search engines, the more buyers will access your site.

Developing up a wholesale-only website is very different than developing a retail website.  You have different pricing structures, different customer base, and different marketing strategies than a retail site — all very important points to consider when deciding how to set up and market your site.  Once again, I was exploring an “unknown” arena where little or no written information was available about wholesale websites. Following are tips and information I learned along the way while developing my own site:

1. Home or Welcome page outlining an overview of your website.  First place buyers look needs to explain that you are a wholesale site selling products as a sales rep to the companies you list on your site.
2. Password protected pages for wholesale pricing.  In order to eliminate the casual consumer from access wholesale pricing, pages can require a password before they are displayed.
3. Buyer’s registration/password request form.  In order to access the password protected pages, buyers need a registration form to provide information to qualify them as a legitimate retailer. 
   
4. Page listings by company rather than products. As a sales rep, you represent companies rather than individual products, so products on the site need listings by vendor or company.  Giving each company a landing or home page, gives you the opportunity to lists specific terms and product for each of the companies you represent.
5. Detailed FAQ page within the top level pages.  Since your wholesale site is very different from a typical retail website, you need to explain about different terms, shipping requirements, etc. per company.
6. Use keywords announcing your target audience and products throughout your copy.   Keywords are words search users enter to find what they’re looking for on the Internet. Obviously, these are the words you want to use to ensure that your website appears in search results page.
7. About My Company page creates a personal perspective to your website.  Telling a bit of history or background to your company changes your presence from an unknown faceless cyber entity into a real person on the web.
8.  Contact page listing all your contact information is very important.  List your mailing address, phone number or numbers, fax number and email.