Credit pressures call for partners

Reps on the road

By Ed Brookes -- Casual Living, 11/1/2008 12:00:00 AM

These are definitely interesting times in the casual furniture industry. We will all be facing challenges, and hopefully some opportunities, over the next couple of months that will surely try our souls.

My use of the word "we" is really central to the point of this column. Every other month, I will be bringing the perspective of the professional sales representative to issues of the day. Our industry is the typical three-legged stool with the manufacturer, retailer and sales rep playing their parts. This is one business where the independent rep has a lot of control over how his or her brands are positioned in the marketplace.

Times have definitely changed and they seemed to have changed very quickly. We all need to react to this new reality and reevaluate how we approach our jobs and how we use our time.

What does this all mean to independent sales representatives? First off, our cost of doing business has increased along with that of our dealers and manufacturers. Between rising costs for fuel, healthcare, lodging etc., we need to plan our time and travel so as to get the best return on that investment.

As sales representatives we get compensated on selling products provided by our manufacturers. The more we sell, the more we make. Sounds pretty simple and I guess it is until you have to decide in a down economy how you are going to sell more. The easy answer is either sell to more people or sell more to the people you already have. Each territory will look at their situation a little differently and evaluate what will be the best course for them but I will bet neither of these two paths to growth will be an easy one. Nationally we are facing credit pressures with our current channel and as dealers drop out there is not a rush of new ones to take their place. What is the rep to do?

First, we are going to have to learn to manage our territories much more proactively. By this I mean really sitting down and evaluating your distribution not just for the next 12 months but looking out a few years. Are you in the right accounts? Are they representing your products in the best light? How is their credit and cash flow? Do they have staying power over the long term? What are their business plans? Does this mesh with your business plan? How can you help them succeed? These are questions that must be asked and discussions that we all need to have with our dealers.

Secondly, the phrase "selling to" has to be replaced with "selling through." We as sales people get paid on volume and our factories need that volume to continue to provide the products the marketplace wants. That will not change and we owe it to our manufacturers to maximize their volume in our territories. What we need to change in this era of managing our sales is our mindset. We need to commit to our dealers that we will take ownership of the products through to the end and do everything in our power to see that their inventory is manageable at the end of the season. This means sitting down on a regular basis and looking at what is selling, what is not and addressing what is not selling quickly and aggressively so as to supply more of what is selling. Nothing ever gets more valuable sitting in a warehouse.

We need to treat our floor space wisely and be confident we are putting the best lineup in front of the consumer. One less dog on the floor should reward you with one extra winner.

Lastly, in these trying times we need to be more visible in our stores. Not for the owners or the buyers, but for the salespeople on the floor who are also suffering during times of soft sales. How we really can help them is through more and better sales training.

As fewer consumers are coming in the doors we must be confident the floor salespeople know how to close that sale. There are a few forward-thinking manufacturers that offer professional training programs but if you do not represent one of them, purchase one or put your own together. If we can increase the closing rates even single digits it will more than pay for the investment. If we as sales reps do nothing but improve the quality of the floor sales personel we will go a long way in surviving this situation.

I really hope I am preaching to the choir. Over my career I have worked with a lot of rep forces and by and large they have been very professional and some of the best in the industry. With that being said it does all of us some good to look at what we do for a living under the light of this new day. It is going to be tough and it is going to take the best of all of us to make it through unscathed. We are in this together and we all are working to the same end. I firmly believe when this is behind us, the casual furniture industry will be better and stronger because of these challenges.