Requirements for Successful Use of Independent Reps

Productive independent sales reps want quality products and services from quality companies. Ready your company to maximize your opportunity for a successful independent sales representation experience.

  1. Be "Rep-Ready" with an adequate business plan
    • Adequate capitalization—can you finance your raw materials, advertising, staff and all other expenses during your ramp up period? This also means that you have either already expended funds for the items on this page relevant to your business, or have the necessary budget for them. If you have not made this investment already or are not prepared to do so soon, you are not ready for reps.
    • Your business plan allows a "living wage" for the rep. For example, if a rep is going to spend 25% of his time on your line, then he needs to generate 25% of his income from it. To achieve a median income level, that means the rep would need to clear $14,000 from your commissions, net of expenses.
    • Your Branding
    • A compelling website
    • Marketing communications and messaging already crafted explaining the benefits and features of the products and services
    • A good pricing model
    • A compelling commission rate
    • Sales Model/Process - lead generation, cold calling scripts, sales pitches, answers to common objections, sales presentations and follow up
    • Sales Management Plan - training process, ongoing support, marketing materials
    • If you intend to sell your product through "big-box" retail, then you understand that to be successful you will need to be prepared for many requirements listed on this page and that it will take time to develop or prepare them. If you don't have for example UPC codes or adequate manufacturer's liability insurance, you need to get these in place before you are ready for reps. Please review this page in detail to determine what applies to your business model.
  2. Understand the Rep Channel
    • Understand that the rep cannot guarantee sales; rather the rep should guarantee access to buyers.
    • Understand time to place order
      • Even if you have the most desirable product imaginable, you don't just walk in to a buyer at Target and get the order next week;
      • Even if they like you, it could take six to nine months before order is in hand.
    • Understand EDI
    • With retail and especially with "Big Box", understand that each square inch of shelf space must achieve the retailer's revenue target; will your product do that?
    • Understand market ramp up time at retail (displays, arranging shelf-space, etc.)
    • Understand that large order size might overwhelm your ability to deliver
  3. Be Ready to Communicate with the Rep on the details as they fit your business
    • Current customer lists
    • Company history
    • Brand comparisons
    • Sales book - pricing and sell sheets
    • Liability Insurance
    • Terms for customer payments
    • Blank invoice for setting up accounts
    • Price lists
    • Volume incentives/Volume bonus programs
    • Holiday and Seasonal items
    • Product and New item information
      • Case Cube / Case Weight / Case Dimensions
      • Pallet Count / UPC / GTIN UPC / Item descriptions
      • Club Packs / Special Packs / Pallet programs / Shippers
      • Knock down (empty cartons/packaging)
    • Placement programs / slotting available
    • Private label, co-branding, branded
    • Delivered and FOB your plant
    • Remittance address
    • Minority-owned opportunities: WBENC.COM
    • Certifications or audits if necessary in your industry
  4. Be Ready to Recruit
    • In order to recruit and entice established independent sales reps, you need to have a sales pitch to "sell" yourself to these candidates.
    • "Closing" a rep is like closing a customer
  5. Be Ready to Interview
    • Have a process in place to filter out those who will not be good candidates.
  6. Be Ready to Contract
    • 1099 Form for Independent Contractors
    • Independent Sales Rep Contractor Agreement (see our sample forms at Training)
    • Non-disclosure Agreement
  7. Be Ready to Manage
    • Have accounting software
    • Have commission reporting capability
    • Plan to get up and running
    • Establish a sales management system

Portions used with permission from Uwe Jannsen and from Bob Cheek, Cheek Sales & Power Marketing.