Step 5 - Form Rep Councils to Improve the Rep-Manufacturer Relationship

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• Getting the Most Out of the Rep Council
• Rep Councils — The Perfect Communication Tool
• A Rep Council Checklist
• Rep Councils Eliminate Us vs. Them Environment
• Listening When It Matters — Steps for Setting Up a Rep Council
• Manufacturer Fine Tunes Its Rep Council
• Real-World Tips for Effective Rep Councils
• The Case for Rep Councils

• MANAcasts: Working With Rep Councils  |  Business Networking Group 2.0 – The Rep Council

Once you establish your manufacturers’ representative network, you want them to sell lots for you. You work together as “Partners in Profits” and an effective tool that fosters this type of a relationship is a Rep Council. The Rep Council provides focused feedback and recommendations on ways you can improve how you work with each other. You select a small number of your manufacturers’ representatives and sales management staff to make up the Rep Council.

Getting the Most Out of the Rep Council

The first thing a manufacturer should ask when considering the creation of a rep council is:
What do I expect my rep council to accomplish?

Remember that the whole idea of having a rep council is to achieve positive interaction — the working together to achieve common goals. Until this question is asked and answered, all the procedural planning in the world will simply serve as window dressing.

When considering answers to the aforementioned question, those answers should be general as well as specific. Since every manufacturer-agent situation is different from all others, one answer isn’t going to fit all. However, appropriate answers might be the desire to:

• Plan pricing strategies, marketing initiatives and sales planning.
• Develop plans to more effectively handle local trade shows.
• Address how the council will work together on long-range plans for market expansion.
• Generate ways to improve service and support of mutual customers.

Unless goals and priorities are established, it will be difficult to get an effective council moving.

One of the most frustrating aspects of rep council participation is for the agent to arrive at the appropriate time and place for the first meeting and have the manufacturer open the proceedings by asking “What should we do to have a good rep council?” That’s a question that should have been asked and answered long before the first session. Well before that first meeting, the manufacturer should be engaged in detailed conversations with his agents, determining where the council is going and what is to be accomplished.

Manufacturers who start a rep council with little or no input from their agents predictably will be disappointed with the results. Manufacturers who involve their agents during the preliminary planning stage, however, maintain that their councils are more effective than those run by manufacturers who dictate council terms to their agents. After all, the idea behind a rep council is cooperative effort. Why not start that effort from the very beginning?

For the purposes of our discussion, let’s assume that the manufacturer has involved his rep council members in the preliminary planning stage, either by lengthy phone conversations or even a detailed survey. What then is the next step?

The logical place to begin is with the selection and appointment of all those who will serve on that first rep council. If a working number of reps have been involved in your planning stages, it’s logical that those who have shared in that involvement would serve on the first council.

It’s not unusual that manufacturers who do plan their councils with several agents, do it with fewer than they know will be a part of the advisory team once the council is established. When all the plans have been made and it’s time for that first meeting, those manufacturers generally appoint the remaining council members.

For your first council members it’s best to seek out agents who have had experience serving on other such councils. Having an experienced group means that you will flounder very little. However, you should be prepared for some pointed comments from those agents. Their suggestions, based on past experiences, may surprise you, but pay attention and listen to their contributions.

The makeup of the manufacturer’s rep council should be determined by the way the manufacturer and his rep “consultants” envision the council working. If the plan is to appoint members based upon geographical considerations, special care should be taken to ensure that the country is covered equitably. On the other hand, if the council is to be representative of skills, specialties or markets, then the same care should be taken to ensure there is equitable representation. The single most important path to follow is that nothing is done arbitrarily and that there is no reason to cause someone to complain.

Keep in mind that membership and participation in a rep council is not some form of award. Rather it is an important and integral part of the job. One criterion to follow when selecting council members is that they should be agents who will do the job well.

Also keep in mind that reps aren’t the only individuals who make up the council — also represented are personnel from the manufacturer’s side. People from that side should include top management and those with important functional specialties.

When it comes to size, there is really no formula to apply that will guarantee success. It comes back to what you hope to accomplish. The size of the rep council is important only in that it reflects representation of both the agents and the manufacturer and that it is appropriate for the task to be accomplished.

Length of Service

How long should an agent stay on the rep council? Among considerations is the continuity of your council. It is desirable to have some part of the council stay in service for more than one year. At the same time you don’t want to have the same people in place year after year. An ideal solution is to have staggered membership. Have terms running from one to three years. That way you ensure there will be some turnover each year, but you won’t be starting from scratch. There is a tremendous loss in productivity when you have to start from scratch each year. When establishing the council, from day one ensure that you will have such staggered turnover by establishing one-, two- and three-year terms. After you’ve begun, you can settle into regular two- or three-year terms for all your members and you’ll be ensured of a regular infusion of new blood and new ideas every year.

Frequency of Meetings

Once established, how often should a rep council meet?

Most manufacturers convene on an annual basis and that seems to be a common practice. Some others also call special council sessions when they or their agents feel they are needed.

Timing of meetings also should be important. Those manufacturers who have seasonal sales situations should consider the time spent out in the field by the council members. It goes without saying that no council meetings should be scheduled during peak selling seasons. Make sure you obtain feedback from all the council members before scheduling a meeting date. Also keep in mind that agents represent other manufacturers, so time is needed to accommodate the needs of those manufacturers.

Meeting Locations

Then, there’s the decision of where to hold the council meeting. If holding the meeting at the plant is integral to the meeting’s success, then by all means, schedule it accordingly. Meeting at the plant also provides council members with an opportunity to meet and interact with other people at the plant whom they should get to know well.

Alternatively, the meeting could be held elsewhere. One of the choices is a resort and there are some factors to keep in mind when scheduling a meeting at a resort. Those meetings typically run for more than one day, often two or three. In addition, the meeting isn’t scheduled there for everyone to stay indoors. Think about the time needed and the expense related to a resort rep council meeting. Some manufacturers alternate between one year at the plant and the next at a resort location. Non-resort venues in central locations are also used.

Scheduling your rep council meeting to coincide with an industry trade show is another possibility that may only work if the agenda is very short, like resolving a single issue. The thinking goes that working a trade show is difficult enough as it is. When faced with the prospect of working both the show and the council meeting, neither provides an ideal opportunity to perform at the highest level.

Expenses

Who pays for participation in rep council activities? Most manufacturers pick up all council members’ expenses for the meeting, including transportation, lodging and food. It is not appropriate, however, for a council member to expect a manufacturer to pick up the expenses for others an agent brings to a meeting. If an agent is accompanied by a spouse, for instance, the agent should pay those additional expenses, unless otherwise notified by the manufacturer.

Responsibilities

Agent and manufacturer members should have specific rep council assignments and each should be accountable for successfully completing those assignments. At the outset, it is the manufacturer’s responsibility to actually run the meeting, but all members should consider it their responsibility to actively participate in the proceedings. Good practice dictates you create an “Operating Charter” for your Rep Council and we attached a sample one at the end of this report.

Agendas

What should and what should not be covered during a rep council meeting can spell the difference between success and failure. When councils fail, often the reason is because one side or the other sees the council as a place to resolve personal disputes or because members don’t take their responsibilities seriously.

Rep councils are not bargaining units. Any discussions that reflect a we/they situation are inappropriate. Also, it’s totally inappropriate for agent or manufacturer council members to discuss individual problems.

Thus it is important to decide in advance the appropriate subject matter to be covered during a rep council meeting. What is appropriate is anything that is important to tasks set by the council, anything that will help sell more product, and anything that will strengthen the bonds between manufacturers and agents. This doesn’t mean that members should function as a rubber stamp. Rather, it means that the council should stick to topics that directly relate to their common interests.

Follow-up

A natural outgrowth of any successful rep council is the establishment of action items; that is, whatever steps the council has mutually agreed upon that should be completed before the next meeting. The responsibility for seeing that action is taken falls squarely on the shoulders of the manufacturer’s employees as well as the agent members. Quite apart from each member carrying out assigned tasks, one agent member and one manufacturer’s employee should be assigned the responsibility for communicating with everyone who should be included in the loop.

Remember that it is very important for everyone to be aware of council activity. It’s also important that individual members be able to communicate when they have things that they feel should be presented to the council.

Is a Council Right for You?

Whether a rep council is or is not desirable for your operation is a personal decision based on personal needs. However, judging from historical input from the field, the existence of some type of council, formal or informal, makes sense for most. Such councils make everyone more productive. At the same time, participation in these councils is hard work. There will be conflicts and doing the job right takes a lot of time — but in the long run, the benefits in terms of better communication and improved relationships between principal and agent far outweigh any negatives.

Rep Councils and Why You Need Them

We address this section primarily to sales managers and rep-managers who are responsible for a rep network. Reps, like your teenage kid, will tell you what you want to hear when you ask a question. Unlike your teenage kids, there is a good reason or perhaps a better reason for reps to tell you what you want to hear. They don’t want to antagonize a good principal and get on your wrong side. Being on the wrong side of a principal can lead to the loss of income or the line. This is one of the main reasons to have a rep council.

A rep council is an advisory board appointed by you, the manufacturer, to advise you and your management. The council should consist of rep firm principals who are good business people, not just your friends. They are there to be your eyes and ears in the field and a reality check for sales and marketing programs. You need honest and accurate feedback on customer trends, pricing strategies, marketing initiatives and sales planning. Rep councils usually meet face-to-face once or twice per year. A good time is when you are in your planning cycle for the following year.

A rep council is a good way for you to introduce your rep sales network to the management of your company. Get the management involved in your rep council meeting. Have the finance person who authorizes the commission checks interact with your reps. Have the CEO talk about strategic direction of the company. This is good for a couple of reasons. If the management of your company knows and understands what reps do and how they do it, it will be easier for you as the rep manager to sell your programs internally. The second reason is that your reps will be more connected to your company and its product line. As rep sales managers, we always look for our unfair share of time from our reps.

Use the rep council to represent the other reps in your network. Assign members of the rep council to get honest and frank input from the reps in your network. At your rep council meeting, go over the results of that feedback and listen. If you can answer questions, then answer them; if not, get back to the rep network with answers. Remember, this is a business meeting and should be run as one. Minutes should be taken and distributed. The rep council is a great conduit back to the rest of the rep network. They have some credibility that you don’t.

Rep councils are a good forum to plan your next sales meeting. Find out what the reps think they need for training. Ask for advice on topics that you believe should be covered. This information can help make your next sales meeting a real winner.

Do not use the rep council to hide from tough decisions you need to make. The rep council is an advisory board, not a policy or strategy making body. You and the management are responsible for the decisions that affect your company. The rep council only offers input for decision making.

So what value does a rep council bring the rep? The rep should have a principal that is supportive of and knowledgeable about reps. This translates to trust, better understanding and larger commission income.

If you don’t have a rep council now, start the ball rolling and get one in place. If you are a rep and have a principal that could use a rep council, make the suggestion. Rep councils are well worth the time and effort.

Rep Councils Serve As Territory Eyes and Ears

If the independent manufacturers’ representative serves as the “eyes and ears” in the territory, then one of the most effective means to truly see and hear what’s going on is the rep council. That’s the view of two manufacturers well experienced in the operation of rep councils. Both Vanguard Piping Systems and Eriez Magnetics have operated rep councils for years, and both have learned to depend upon the input they receive from their reps in order to better serve the market.

While both companies took slightly different routes to their implementation of rep councils, each has arrived at the same conclusions:

• Regular council meetings can head off problems and concerns before they become major headaches.
• Reps appreciate the opportunity to exercise a loud and clear voice with their principals.
• Councils are valuable tools for manufacturers to communicate with their reps and reps to communicate with their principals.

Charlie Ingram, vice president sales and marketing for Eriez Magnetics, explains that his company’s rep council began operations, shortly after he joined the company. “I previously had considerable experience working with distributor councils and working with a direct sales force. I felt strongly that having a rep council would help us. At the time, we felt we had excellent communication with our reps, but our goal was to formalize that communication into business meetings that ultimately would help us better serve our mutual customers.”

He adds that an underlying reason for the council was the desire to completely eliminate any form of an “us vs. them” attitude and to firmly establish an agenda focused on the rep-manufacturer relationship. “We worked very hard to set up a platform that would allow us to discuss how we could collectively serve our customers better by finding what each of us could do better to improve our methods of communication and service. In other words, we were looking to get to the point where one plus one would equal three.”

The Erie, Pennsylvania-based Eriez Magnetics designs, develops, manufactures and markets magnetic separation, metal detection and materials feeding, screening, conveying and controlling equipment for the processing and metalworking industries.

Getting a “Feel” for the Rep

Vanguard Piping Systems, McPherson, Kansas, espoused similar reasons for starting its rep council. According to Dalyn Cantrell, national residential sales manager, “We simply wanted to get a better ‘feel’ for what our reps face every day in the field. They are the ones who are face-to-face with the people that make our company successful. In order to continue to grow and improve as a manufacturer, we have to listen to our customers. The rep council fills that need.”

Vanguard Piping Systems manufactures cross-linked polyethylene (PEX) tubing and accessories for a variety of plumbing applications. The company has been recognized three times as one of the 500 fastest-growing U.S. companies by Inc. magazine.

Looking back at the beginnings of his company’s rep council, Ingram recalls that there was some concern among management that the council might evolve into sessions where only rep complaints would be aired, and “all we’d be talking about would be what everyone is doing wrong.” Such whining sessions were avoided, however, as the effort was made to “seed” the council with reps that had served in similar capacities elsewhere. “I made a concerted effort to survey reps that had served on other rep councils and to determine what were and were not meaningful experiences,” he explained. “I made sure that our charter members reflected a balance among our reps. It was made up of those who had been with us for a while, together with some who were fairly new.”

Ingram emphasized that much of what he did with his rep council was culled from information gained at a MANA seminar that was dedicated to the subject of running successful councils. “I remember one of the examples from that seminar cited a manufacturer that formed a council made up only of his five or six top-performing agencies. This didn’t work, because all they chose from were reps that made up a virtual ‘love fest.’ Everyone was happy, and they didn’t get any input from others who might have suggestions on how to make things better in the territory.”

On the subject of the tendency of having rep councils turn into “whining” sessions, Vanguard’s Cantrell offers that “Yes, sure there’s a possibility that can happen, but that’s not entirely a negative. We want our reps to bring every issue they can think of to the table. If it turns out to be a personal issue, however, our approach is to say ‘Look, that’s not something we necessarily face on a national level. We’ll deal with that later. Right now, we want to work on things that impact all of us.”

She continued that “one of the biggest challenges that we faced in the beginning was conveying to all of our reps that the rep council meetings were for them! We wanted them to vent — in either a positive or negative manner — and those of us from the factory were there to listen — not talk. Our rep council members are given a list of contacts (other Vanguard reps) months prior to the meeting, and they make and bring the ‘agenda items’ to us at the meeting. We are prepared to discuss anything, and we want to. Once we got our reps to understand that if they didn’t come to the meeting armed with agenda items we were wasting our time, everything went very smoothly.”

Both manufacturers emphasize the positive aspect of having a rep council in that a rep should be complimented that he’s asked to participate. “We’re especially picky,” notes Cantrell. “As a result, we’ve got great reps making up our council, and it works well for us.

Ingram adds that for any rep asked to participate in his company’s rep council, “It should be viewed as a reward. It’s not just another business meeting. Rather there’s an amount of prestige that goes along with us asking them to serve.”

Length of Council Service

Both companies explain that having a plan in place for rotating rep council members on and off is important in terms of ensuring that fresh ideas are contributed. According to Ingram, Eriez Magnetics’ “goal is to have a council composed of seven members, each of whom serves a three-year term. Two members at a time are rotated off.”

Cantrell explains that “With our very first council, three members served a year and three others served a two-year term. This started our rotation of two-year terms that included annual meetings, with half of the group rotating off after four meetings.”

Importance of Regular Meetings

One of the keys to the success of an ongoing rep council rests with the continuity of the effort. Both companies have regularly scheduled meetings and they follow up the meetings with action.

According to Cantrell, “We conduct our meetings annually at an ‘off-site’ location. We find that going somewhere ‘neutral’ makes our meetings much more productive as we all are able to focus on the agenda — and nothing else. For instance, our last meeting was in Denver, and our next meeting will be somewhere in the eastern region, perhaps Washington D.C. or Nashville. We also try to rotate regions for our locations. After we go east, we will probably shoot for San Antonio or Chicago in the central region.”

Likewise, Ingram notes, “Our meetings take place every nine to 12 months. Almost all of them are off-site from the factory. We look to find some sort of neutral ground that allows us to get outside our normal environment. We’ve tried both business and resort locations someplace in the middle third of the country. That makes it easy for just about everyone to attend.” He adds that Eriez also has conducted its rep council meetings in conjunction with various association and trade events/conferences.

No meeting can be successful unless plans are laid ahead of time, and that’s what Eriez does, according to Ingram. “Each of the six reps that comprise our council have their own team of five or six reps that they communicate with. Prior to the regularly scheduled rep council meeting, we’ll send out a form from headquarters to all of our reps. That form includes all the issues we’d like to have addressed and discussed. At the same time, we ask that our six council members solicit subjects/ideas for the agenda. After we receive those suggestions, we’ll put together the formal agenda we’ll cover during the meeting.

“The meeting itself generally covers an entire day with dinner the evening before. After the meeting we follow a formal and an informal process. We’ll formally put together a report that covers every agenda item. This is circulated among all members of internal management and our field sales offices. The rep council members typically provide their own report back to the five or six reps that they work with.”

For its rep council Vanguard has divided the country into three separate sales regions: East, West and Central. Cantrell explains, “Each region has a regional manager and for the first rep council, each regional manager chose two reps from each of their regions. That gave us a total of six reps. If the meeting is scheduled for a location outside the rep council members’ territories, the local rep is invited as well. As a result, we either have six or seven reps in attendance at each meeting. Only the six council members are assigned other reps to contact prior to the meeting.

Cantrell continues, “Since we began our rep council, we’ve found that two meetings a year were too much and we didn’t have enough time between meetings to address issues that needed to be addressed. It was also very expensive to conduct those two meetings a year and take our key reps off the street when they could have been selling our products. At the request of our rep council members, we now have an annual meeting and members serve three-year terms. Departing members are replaced by someone else in the region, chosen by the regional manager. Of course, chosen reps must be willing to serve on the council. If they choose not to, another rep is chosen.”

Placing a Value on the Council

Looking back over several years of success with their rep councils, both manufacturers offer that the effort has been well worth it. Ingram notes, however, that the rep council is a body that must be relied upon as a contribution to the marketing and sales effort. “The rep council isn’t something you can necessarily pull out of a box every once in a while,” he says. “On the contrary, we use the council throughout the year. Our council members are tapped regularly for their opinions on multiple issues throughout the year. Examples of subjects we’ve consulted them on have been payment terms, literature formats, and new policies.”

He concludes that while there is a certain expense affixed to conducting the rep council meetings, “Overall, I don’t think the expenses have been extravagant. On the other hand, there’s no question that the council has resulted in any number of money-saving, money-making suggestions.”

In the same vein, Cantrell adds, “While our council hasn’t necessarily changed the way we work with our reps, it has solidified and enhanced our relationship with our reps. By having the meetings and coming away with a ‘to-do’ list, and then actually acting on most of the issues, we show that the council, and all of our reps for that matter, really do make a difference. It also shows that Vanguard cares about what they have to say. Our reps play a huge role in our day-to-day business and our continued growth and success. The council gives us the opportunity to listen to the market through the voices of our reps. It works!”

Better Late Than Never With A Rep Council

The only complaint Michel Podevyn, chairman, Spiroflow Ltd., voices concerning his company’s rep council is that he didn’t start it sooner. Those words should be read as a ringing endorsement for the concept of creating and listening to the members of the council since its inception a little over a year ago.

The Consensus Advantage

As Podevyn explains, Spiroflow started their rep council with the primary purpose of taking advantage of a consensus from a small group of people “whose views we respected.” He emphasizes that those who comprise the council may not be the highest performers in terms of turnover or sales. “Rather, they are individuals we hold in high regard in terms of the industries that we are involved in.” Geographically, members of the council come from the following areas: California, North Carolina, Massachusetts, Louisiana and from the Philadelphia and Seattle areas.

The council is set up to meet twice annually. “Initially, we felt it was important to hold our first meeting here in Charlotte,” explains Podevyn. “From the outset, we wanted to maximize our time with the members and take advantage of the proximity to our plant so members from farther away (e.g., the West Coast) could become familiar with our manufacturing process and the plant personnel. Following our first meeting, our goal is to either pick a central geographical location or have subsequent meetings near one of our member’s locations and have them host the meeting with us covering all costs.” He adds that a resort location would only be considered for the meeting after checking with the council’s members for their preference. “If everyone agreed a resort was a good idea, we’d try to make it over a weekend.”

Only the Vocal Need Apply

When it came to picking council members, Podevyn emphasizes the importance of choosing people who have an opinion and are willing to voice it. “I made sure I knew the agents we were going to ask to participate and I was sure they’d accept. Furthermore, we didn’t want anyone who was going to hold anything back.” After he chose those he wanted on the council, he called to ask for their participation. “They were all very enthusiastic and honored that they had been chosen. Once I had their acceptance, I sent them an agenda for the first meeting and asked if they would like to add, delete or suggest any changes. After just a few changes, we had our agenda.”

Looking back over the first council meeting, Podevyn critiqued it by saying, “I conducted the meeting and we religiously stuck to the agenda. We got what we wanted. No one held anything back. We took detailed minutes of the day and a half meeting and in a little over a week we had an action column that evolved from the meeting. Several of the action items will require work from people within the company and a few of the reps volunteered to provide input. Some of the action items will take more than a year to implement, but all the ideas were excellent.”

Listen, Appreciate and Provide Feedback

For anyone else considering the implementation of a rep council, Podevyn was adamant that “they be prepared to listen to what their reps tell them. Remember, listening doesn’t necessarily mean you’re going to implement something to the tee, but listening is critical to the communications process. And by listening, I mean you let the participants, who have taken as many as four days away from their businesses, realize that you truly appreciate what they are doing for you. Unless you are prepared to do that, they won’t participate again.”

He adds that even if “you don’t agree with suggestions the council offers, you must tell them why. Then come back with a compromise plan. Feedback is critical. If you have a meeting and everyone goes away feeling nice and warm and then nothing happens, you won’t succeed. Remember you’re working with sales organizations here. If you give them a checkbook, they will empty the account accomplishing things that will help them sell better. A lot of the ideas the council will offer can be cost prohibitive, but that doesn’t mean they’re not good ideas and can’t be implemented long-term.”

New Blood Keeps a Council Alive

Podevyn remains enthusiastic for the use of the council in the future but he realizes the need for new blood and new ideas. “For the future, we’ll probably ask our council members to sit on the council for only a year. However, any of them who volunteer to serve longer would be graciously accepted. However, I hope if that happens that they would send a different person to participate in the next session. That way we’d get new people but achieve some continuity at the same time.” He added that eventually there would be an effort to stagger the membership so there was a regular turnover of agencies — while at the same time maintaining the continuity needed for the successful operation of the council.

In hindsight, Podevyn admits “I wish we had a rep council from day one, particularly because the original company was a joint venture with a company from the United Kingdom. Initially, all we really heard was what our two partners thought were good ideas. I can see that we’ve already greatly benefited as a company from the council instead of talking among ourselves.”

Rep Councils Show Manufacturers’ Commitment

“A properly established and run rep council is a critically important piece of the relationship between a manufacturers’ representative and a principal.”

With those words of introduction, you know in a hurry where Bob Gerrard comes from in a discussion of rep councils.

Gerrard, of Gerrard & Associates, Inc., Mooresville, North Carolina, knows from whence he speaks, since he’s been an instigator, advocate and participant in the operation of three rep councils in his career. Gerrard & Associates, a manufacturers’ rep, sells dry bulk material handling equipment. The agency has five employees and represents the lines of 13 manufacturers. Its territory covers North and South Carolina.

“I was involved in starting up all of them,” explains Gerrard, “and basically they were initiated for one of two reasons. The first manufacturer was simply in serious trouble. They weren’t shipping, performing or delivering products on time. The other two companies I’m experienced with realized that it was just a good idea to have a rep council.”

Considering first things first, Gerrard related his experience with the manufacturer who wasn’t performing. “The first rep council was one that was started by the reps, not the manufacturer. We had reached a point where something had to be done — it was a case of self-survival. The manufacturer in question was one that was very important to all of us, but so many problems had developed that I felt the reps had to get together to discuss mutual problems. All of the reps I contacted for the council shared my concerns and realized something had to be done. Once we got the reps in line, I called the manufacturer and let him know what we were doing. He was invited to participate in the council meeting. Actually what I told him was that there were the beginnings of a revolt going on among his reps, he could meet with us or not, but we were going to meet anyway.”

Gerrard continued that the manufacturer (the vice president of sales) agreed to meet with the reps, “but he was more politically correct than anything else. His message was to go ahead, have the meeting as if I’m not there. That’s a typical reaction from someone who views the rep council as a threat. As the meeting moved on, however, it wasn’t long before he realized we were not a threat. We just wanted to make a bad situation good.”

Gerrard continued that the manufacturing executive was impressed with the interaction among the reps and the fact that the issues tackled were not petty, rather they were substantive. “Actually it was an education for him. He saw that we were true professionals and could contribute. There were also no real surprises for him and his company, he knew the company was in trouble.”

The end result in this case was that the manufacturer kept the rep council running successfully for a little over a year and made efforts to communicate with their network of reps. Eventually, however, they fired all their reps and went with a direct sales force.

In the two other instances where Gerrard was involved in the establishment of rep councils, he explains that both evolved from each manufacturer’s genuine desire to foster better communications with their network of reps.

From his experience with manufacturers and their rep councils, Gerrard maintains you can tell a lot about how a manufacturer perceives his reps. “Many will just give lip service to better relations with reps, but a company that is serious about creating partnerships with their reps will embrace the concept of a rep council.”

On some of the logistical issues that surround the operation of a rep council, Gerrard has some firm ideas on what should be done:

• “When it comes to payment of expenses, I believe the manufacturer should pay all related expenses for a rep council. Remember the rep council is not a sales meeting, rather it’s an opportunity for both sides (manufacturer and rep) to gain through communication. It’s important for the manufacturer to pay expenses because the rep is making a significant investment of his time, since he is being pulled out of the field and away from his customers. What this gets back to is, What is the manufacturer’s perception of how valuable the rep’s time is, or is he simply taking the rep off the golf course?”
• In Gerrard’s opinion, the rep council meetings must be conducted at or near the company site. “While they shouldn’t be held at the factory, factory personnel should be available to the meeting participants.”
• How often rep council meetings are conducted is dependent upon how big the agenda is and how active the council has been between regularly scheduled meetings. Gerrard emphasizes that councils should be active between meetings, gathering comments and suggestions from participants. He also maintains that an annual rep council meeting was generally sufficient and it works especially well if it can be scheduled around an industry trade show that participants would normally be attending.
• When it comes to the agenda, he maintains that it should be set by both the manufacturer and the rep members, but “at the same time, it’s important to remember that it’s normally the manufacturer who starts the council, so he should have major input into the agenda.” When it comes to the agenda, Gerrard cautions that not having a serious and well-thought-out agenda can be a serious error. “I’ve developed that opinion by way of observation. I am stunned by the number of manufacturers who don’t understand their own marketplace — and that’s reflected in their lack of knowledge when it comes to putting an agenda together.” He adds that an agenda should develop naturally as the manufacturer and his reps realize that they have something important to talk about.
• Once a council meeting is conducted, it’s up to the manufacturer to take care of notes, the dissemination of the minutes and any follow-up required from the meeting.
• What should a busy rep’s reaction be if he is asked to serve on a rep council? According to Gerrard, “As long as a serious and significant agenda is presented, he should be complimented and make every effort to participate. If his first reaction is ‘I’m too busy in the field for this,’ then he’s in the wrong business.”

The Good, the Bad, And the Ugly about Rep Councils

The title of an old Clint Eastwood movie, The Good, the Bad, and the Ugly, comes to mind as a number of manufacturers’ representatives were asked for their thoughts regarding rep councils. There was just about a universal feeling that reps were positively disposed toward such councils, given a few important caveats. Among those caveats were:

• Manufacturers should set the agenda for such councils.
• Manufacturers should allow for the free communication of ideas during such councils.
• Following council meetings, action must be taken and communication undertaken, thereby giving weight to the reps’ efforts in participating.
• Principals must approach such councils with an open mind and be willing to accept and often act on the input of their reps.

To let you know where this thinking comes from, what follows is a sampling of the views of several of the manufacturers’ representatives contacted for this article.

Taking the Good with the Bad

The original reference to “the good and the bad” comes from Ed Reese, Motion Components, Brea, California. Motion Components sells a variety of industrial products, including ball screws, acme screws, slip rings and ball bearings to OEM customers.

According to Reese, “I had a situation where I wasn’t on the rep council but one of my people was. After attending a two- or three-day council meeting, he came back to us with his version of the feedback. Two weeks later the principal suddenly announces sweeping changes in their sales and marketing program. These were all changes that were never alluded to in the council meeting. And when they announced their changes they told us, ‘We need your feedback.’ I said ‘No, we need yours.’ Then I asked them if they were thinking about this drastic change, why didn’t they bring it up at the council meeting instead of springing it on us two weeks later? Their response was they didn’t think that was the place to do it.”

If that was the bad side, Reese also knows what the good side is like. “We have another principal and while there is no formal council, we do get invited from time to time to get together. They bring in their top reps and we just chat about things that are important to all of us. This type of communication has led to many important changes with their inside sales group and also led to additional changes in manufacturing where they as a company didn’t realize they needed more production to meet market demand.”

Only the Well-Run Rep Council Need Apply

“Rep councils can be very productive for the manufacturer and his reps, but they have to be operated properly.” That’s the view of Gene Fields, South-West Independent Marketing, Inc., Santa Ana, California. Fields explains that for several years he sat on the manufacturer’s side of the desk before becoming a rep, and over the years he’s seen the best and the worst among rep councils.

“If I could offer an overview,” he says, “it’s that if the manufacturer doesn’t maintain control of the council meeting, it won’t go well. If he lets reps run helter-skelter with the thing, it will turn into an ugly experience. That can be avoided by creating and sticking to an agenda. Inherent in the agenda is the fact that it is the manufacturer’s rep council and he’s in control. If he exercises that control, then the results will be beneficial.”

Fields recalls one instance where the manufacturer did not exercise the necessary control and suffered the worst kind of results. “It wasn’t long into the meeting when all the reps became so angry that they just got up and stormed out of the meeting — it was over almost before it began.

“A major benefit to the principal in the operation of a well-run rep council is that he receives excellent feedback from the field. Concurrently, the rep benefits by being able to give his input regarding any number of matters including the kinds of products the manufacturer needs to introduce, or changes in his sales policy or adjustments in pricing policies.”

Fields concludes by offering this advice: “My recommendation is for manufacturers to have rep councils and to control them. And for reps, if they are asked to participate, do so. It’s a compliment and your active participation will only make them more effective.”

Councils Not the Norm in Some Industries

Frustration was voiced by Jim Robinson, JAYROB Assocs., Leucadia, California, when the subject of rep councils was raised. “If something like a rep council developed in my industry, it would be enlightening and shocking.” Robinson sells plastic injection molding/extrusion machinery, auxiliary equipment and plastic raw materials to end users, the government and OEMs.

He maintains that in his industry, where the $40 to $50 billion a year companies are the norm, such councils would truly benefit those involved, but it’s very difficult to get things started. “I’ve tried to put together councils with two different principals, but each time the principal fought it off.” He adds that it is generally the principal who is number-one in the market that resists councils the most. “These companies are generally very dogmatic in their relations with reps.”

Robinson believes that such councils serve a positive function “given my philosophy that the more a rep can be made to feel a part of the manufacturer’s organization, the more he can make it transparent to his customers he is not an independent representative. Participation in a council lets the rep appear as a fully informed, knowledgeable and dedicated arm of the manufacturer. In order to do that you need a good understanding and sense of partnership on both sides — and that’s what such councils create.”

He advises that principals can greatly improve the performance of their reps “by making them more of a team. They’ve got to communicate a feeling of partnership rather than dictatorship.”

Strength in Numbers

The collective strength of the reps’ voice is a major reason Tom Hippensteel, Sr., Mr. Hip Marketing Corp., Tustin, California, believes in the operation of rep councils. “I’ve served on a couple and they’re especially good because they provide a venue whereby the principal can be exposed to a problem that an individual rep would never mention. For instance, a single rep may not want to tell his principal that they have the worst quotes of anyone in the field. He’d be afraid of the repercussions. But if the entire group discusses the issue, that’s another matter. Certain problems can be exposed and discussed for the good of all.”

Hippensteel, who represents castings, forgings, stampings, rubber, plastic, fasteners and machining, did offer the following suggestion for a council meeting: “Have someone other than the principal’s sales manager record everything said at the meeting. Be sure to record all comments and suggestions, unless all in attendance agree something should be kept off the record.”

Be Prepared to Handle Sensitive Issues

Paul Kruschke, Industry to Industry, Inc., New Berlin, Wisconsin, made the mistake of being so proactive in favor of creating a rep council that his principal named him chairman for the group. “To be honest, I put at least 40 hours into preparing for the meeting that the principal really had very little to do with. I based my preparation on a combination of information from MANA and some creativity. What turned out was an interesting experience, especially because at some point we ventured into confidential areas of our principal’s operation. We learned that you must be prepared to take care of sensitive issues. At the same time, if something derogatory about the principal is brought up during the meeting, we required that participants had to be prepared to provide a solution or suggestion that would assist the principal.”

At its best, Kruschke maintains rep councils provide an “extremely good opportunity for principals to learn firsthand from us what’s going on in the field. Second, there’s the opportunity to learn what the competition is doing when they hear it firsthand from us. And finally, the council serves as a vehicle where concerns or problems reps may have can be addressed in an organized manner.”

Kruschke continued, however, that what was tragic about the whole experience was that while he believed “the principal really wanted to hear certain things, he didn’t have a determined agenda to share with us. As a result, only some of the important areas were covered.”

In the future, Kruschke maintains he would be glad to serve on another rep council. “The only thing I need is that the principal demonstrate to me that he is open minded enough to not only discuss confidential matters with his reps, but also to commit to take action based on the input of his council. That action should take the form of some sort of communication to the rest of his rep organization.”

Communication Benefits All

While admitting that he had no direct experience in participating on a rep council, William J. Dunkley, Jr., Midwest Air Equipment Company, London, Ohio, describes himself as an advocate. “Just recently one of my principals asked me to participate and I think the experience will be very worthwhile. From the rep’s perspective it’s beneficial because it allows us to provide the manufacturer with input directly from the field. For instance, we can let him know what we think about the quality of his product based on our experience with customers. “Basically, we can communicate directly to him what the needs of the marketplace are. Such councils are of benefit to the manufacturer because they know we have our fingers on the pulse of the marketplace and they know they’ll have a forum from which they can draw upon our experience.”

Worth the Effort

Ken Roinos, RLJ Associates, Inc., Scotia, New York, admits the idea of serving on a rep council sounds mighty appealing. “I’ve never been on a council but whenever I’ve met other reps at training programs sponsored by principals, the networking has been very beneficial. In addition to what one rep can learn from another, the feedback the principals would receive from such a group would be well worth the effort.”

Roinos sells welding equipment, composite parts and waterjet cutting systems to contractors, OEMs, and end users.

He also maintains that rep councils could serve as the ideal medium to carry criticism to the manufacturer concerning how they may be perceived in the field. “Remember, there’s safety in the numbers of a rep council. Most of these principals are successful businesspeople, so when more than one person delivers a criticism to them, chances are they’re going to listen.”

The Need for More Rep Councils

If all manufacturers were to operate as those contacted for this article, then they would depend on rep councils as a major tool in the communication process with their field sales force. Unfortunately, that’s not the case, because there is a great need and plenty of room for more rep councils. While we’re waiting for that growth to occur, however, read what the following manufacturers had to say about their experiences.

The need for the rep council to focus more on ways to increase business was the wish of Don Reynolds, Jordan Controls, Inc., Milwaukee, Wisconsin. Jordan manufactures products for process control industries.

As Reynolds explains his company’s experience, “We conduct rep council meetings about every six months, generally following guidelines provided by MANA. We begin with a pretty hefty agenda and many of the subjects covered are the ‘touchy feely’ type. They include things such as the need to change commission structure, not the rate, just how we split commissions. Council members wanted to have a notification on field service when they go out in the field rather than the normal notification after they return. They voiced their desire to have a new product catalog with their name on it. We go right down the list and accomplish all items. Long-term our desire is to cover subjects that will help us increase business. What we’ve done so far is to make changes so that it’s easier for reps to do business with us. During our next meeting it’s my hope we can come up with items that will help us both increase business.”

While Reynolds is very high on the operation of rep councils, he voices some disappointment in how results of the council meeting are communicated to all reps — those not on the council. “I believe a lot of reps in the field don’t pay attention to the results of the rep council meeting. Following a council meeting and after we’ve disseminated minutes of the meeting, I’ll have our regional sales managers go out in the field and ask reps what they thought of the various action items. Most of them never read the minutes. Their answer is that if we realized all the paperwork they had to complete, we wouldn’t read them either.”
He adds, however, that he believes the operation of the rep council is maturing, and since the pent-up demand for many of the earlier action items has been met, “I believe we’ll begin to focus more and more on ways to increase business and provide our customers with greater satisfaction.”

In terms of actually naming members to a formal rep council, H.B. Turner, Heatron, Inc., Leavenworth, Kansas, explains “While we never called what we do a rep council, for the past two years we’ve employed a process whereby we have a group of reps that helped us design a sales expectation performance program for our agencies. Then they designed some forecast software that they work with. During the second year, the group revamped our contract, putting in commissions structured on a graduated scale. This was done so they would be compensated for new business and receive an additional 2% when they reach goals. Our plan for the third year is to have them monitor the work they did during the first two years.

“The group we’ve worked with has been given specific goals. We’ve never had a council that has dealt with day-to-day operations. With the task assigned to them, the reps have a great deal of input, although we have the final say.”

Turner adds that in his view “a council or network of reps is a very good idea. In many ways it assists the manufacturer in showing his dedication to the rep sales force and his belief in marketing through agents.”

Heatron is a manufacturer and designer of custom heating elements, including cartridge heaters, band, strip and aluminum heaters.

And finally, a third manufacturer compares a well-run rep council to a company newsletter. “I advocate the use of a rep council, but I think they’re a little like a newsletter in that everything goes fine for a couple of years and then they die a natural death. Likewise, councils run well for a while and then they die their natural death.”

He adds that “we’ve had them in the past and they’ve worked well. Right now we don’t see any need for the input they can provide. But I’m sure we’ll have them again in the future.”

When his company has had councils in operation, this manufacturer noticed a couple of dangers. “We’ve used councils and have a lot of experience with them. Their effectiveness is obviously a direct result of how well managed they are. Somebody had to take charge and that has to be the manufacturer who appoints one person as the lead person. If you don’t get strong and competent leadership from that person, then the whole process breaks down. And when it breaks down, everybody loses interest and it dies. If done correctly the rep council offers tremendous value in generating ideas from the reps. In addition, typically the rep members of the council are the ones who are more committed to the line and their opinions are valued by the manufacturer.”

While vouching for their effectiveness, he also warns “If not managed properly, the council can disintegrate into simply a means for beating up everyone on matters such as price, delivery and product quality. And, if held at the factory, it can reach a point where people there will dread the rep council.”

Then there’s the problem of the manufacturer making promises to the rep council and not following through. “If the manufacturer says he is going to make this or that change and doesn’t do it, the confidence your reps have in you is shaken. In that case the rep asks what was the sense in us providing all this feedback if you’re not going to do anything with it?”

Rep Council Review

Appearing in the pages of Agency Sales over the past several months have been related articles on the subject of rep councils. The subject has been viewed from a number of perspectives including:

• Manufacturers who have and have not worked with councils.
• Reps who have worked on councils and those who wished they had.
• How to start and maintain the council.
• How to plan and cover an agenda.
• How to populate and rotate membership on the council.

While it would be ideal to go back and read every article that has appeared in this series, what follows will serve as a review or checklist to consider when approaching the rep council from either the manufacturer or rep point of view.

Communicate Your Council Goals

Obviously the best place to start is the beginning — so let’s go there. At the outset, to ensure that your plans for operating a rep council don’t proceed in a void, it’s critical to communicate. Communicate with every person who will be involved with the operation of the council. As to what you’re going to communicate, start with the goals you hope to accomplish. At the same time, let all who will be touched by the council know what your role in the process will be. Once that’s done, there won’t be any surprises as the process evolves.

Member Selection

Next, address the process of selecting your council’s members. Many manufacturers have found that they’ve had better experiences by choosing manufacturers’ representatives to serve who have been with the manufacturer the longest. They know the manufacturer, his product, his personnel and the marketplace better than anyone else. In addition to the knowledge that length of service provides, their tenure will also provide them with a willingness to participate in the process with a high level of candor and objectivity.

The newer or less experienced reps should not be excluded from the process, but at the beginning it’s often helpful to have the more seasoned veterans available who can help you hit the ground running.

On the manufacturer’s side, the personnel who sit on the council and participate in its workings should be senior personnel who carry the appropriate titles. At the same time, they should be empowered to make decisions on behalf of their company without having to check with some higher ups.

Length of Service

Then there’s the question of how long should members serve on the council. The quick answer is that they should stay in place for as long as it takes them to get something accomplished. Given that a manufacturer’s council will probably meet once or twice annually, it would appear that a one-year term is hardly desirable. Several of the manufacturers contacted during the preparation of this series of articles leaned more toward a two- or three-year term. And one manufacturer who uses the latter time period ensured the production of his council by planning a major goal for them to achieve each year. That way both the principal and his reps realized a feeling of accomplishment.

Length of time on the council for rep members should be staggered so that while there is a continued infusion of new blood, there are also a number of experienced reps who stay on, thereby guaranteeing stability in the council’s operation.

Market the Council

Since the success of any manufacturing venture can only be achieved via a comprehensive marketing effort, so too should the operation of the rep council. In other words, once it’s up and running, to give it a chance to succeed, see to it that it is constantly marketed to the entire representative sales force. As can be read in this series of articles, this can be accomplished through newsletters, having the manufacturer’s regional managers communicate the word in person, or having the rep members of the council communicate to their peers. In any event, the efforts of the council will be wasted if there is not a concerted effort to get the word out.

Council Size

Function and representation should be the key words when considering how large (or small) to make the council. Keep in mind that if it is too large, it becomes cumbersome and very difficult to accomplish tasks. When thinking of size, consider what it is you want to accomplish and then decide what number would be needed to get the job done.

Keep it Going

If the council meets only once or twice a year, that doesn’t mean that’s all there is to the job. Before and after the formal meeting, the council should still be operating, whether it’s planning, communicating or implementing new plans.

Expenses and Location

Finally, there are expenses and location to be considered. Most of the manufacturers we contacted maintained that since they knew they were taking their reps out of the field and causing them to lose time in their territories, they felt it more than appropriate to take care of expenses. At the same time, that’s the same kind of reasoning that caused some manufacturers to occasionally conduct their council meetings at resorts — away from the plant — as a form of partial reward for the efforts their reps were making by their participation. However, many did emphasize the importance of holding the meetings at plants to allow reps to become more familiar with the manufacturing process and the personnel they are so dependent upon.

Other Considerations

If those are some considerations to keep in mind when planning a rep council, once it’s up and running, there are some other elements to keep in mind. For instance:

• When a small group of people gets together, there’s always the danger that someone has a personal agenda. Avoid that at all costs.
• Goals should be realistic and reachable. There’s nothing worse than a volunteer serving his time and realizing that nothing he did made any difference — that whatever was set as a goal could never be reached.
• Responsibility and accountability should move to the fore. Be sure that each member of the council knows what their responsibilities are and emphasize the point that they are expected to follow up on all their assignments.
• In communicating the agenda, emphasize that each member of the council has the opportunity to submit topics that they feel are important.
• One member of the council should carry the responsibility to take minutes of all meetings and then follow up by communicating those minutes in a timely fashion.
• Feedback is critical to the successful operation of the council. As a result, manufacturers should let members know what they thought of the council meeting and they should require council members to provide similar input from their vantage point.
• Council members should be encouraged to work closely together and the manufacturer should make his personnel available to council members.

Sample Operating Charter for Rep Council
(modify as needed)

Challenge: To continuously seek to improve principal’s way of doing business

1. Objective:

The Rep Council exists as an advisory group to provide ideas, information, insight and assistance to principal in developing policies, procedures and strategies in order to maximize sales and customer satisfaction.

2. Membership Structure:

Principal invites one representative from each of seven manufacturers’ reps agencies from the United States and Canada. Agency size, geographic location, markets served and Principal tenure will be factors for membership selection.

From the Principal, the President and CEO, Vice-President of Sales and Marketing, Director of North American Sales and Director of Corporate Communications serve on the Rep Council. Additional personnel participate as appropriate.

3. Terms:

Three-year staggered, for representatives. The standard term period runs from January 1–December 31. Principals select new members to fill vacancies when reps retire.

4. Meetings:

The Rep Council meets approximately every nine (9) to twelve (12) months, or three times during representative’s term.

5. Expenses:

Principal pays Rep Council Members for all Council meeting transportation, hotel and meal expenses.

6. Discussion Topics:

The Rep Council review subjects that benefit all agencies collectively. Principal will review concerns of individual agencies separately, outside of this forum.

Discussion topics include sales policies, new products, communications, promotions, competition, delivery and service, and sales aids. The Rep Council may discuss other topics if necessary.

The Council assigns rep members liaison responsibility for non-council agencies to provide input and two-way communication relating to Council activities. This includes discussion topic input for an agenda that Principal sends to each Council member 2–4 weeks prior to a meeting.

7. Meeting Follow-Up:

Principal will distribute a summary of each meeting to all rep agencies. Principal encourage Rep Council members to provide their team member agencies with their own feedback and summaries.

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While the previous article describes what transpired earlier this year during the course of a three-day MANAchat devoted to the subject of rep councils, what follows can serve as a primer or checklist to consider when approaching the rep council from either the manufacturer or rep point of view.

✔ Communicating Goals

At the outset, to ensure that your plans for operating a rep council don’t proceed in a vacuum, it’s critical to communicate.

Communicate with every person who will be involved with the operation of the council. As to what you’re going to communicate, start with the goals you hope to accomplish. At the same time, let all who will be touched by the council know what your role in the process will be. Once that’s accomplished, there won’t be any surprises as the process evolves.

✔ Selecting Members

Many manufacturers have found that they’ve had better experiences by choosing manufacturers’ representatives to serve who have been with the manufacturer the longest. They know the manufacturer, his product, his personnel, and the marketplace better than anyone else. In addition to the knowledge that length of service provides, their tenure will also provide them with a willingness to participate in the process with a high level of candor and objectivity.

The newer or less experienced reps should not be excluded from the process, but at the beginning it’s often helpful to have the more seasoned veterans available who can help you hit the ground running.

On the manufacturer’s side, the personnel who sit on the council and participate in its workings should be senior personnel who carry the appropriate titles. At the same time, they should be empowered to make decisions on behalf of their company without having to check with some higher ups.

✔ Length of Service

Then there’s the question of how long members should serve on the council.

The quick answer is that they should stay in place for as long as it takes them to get something done. Given that a manufacturer’s council will probably meet once or twice annually, it would appear that a one-year term is hardly desirable. Many manufacturers lean more toward a two- or three-year term. One manufacturer who uses the latter time period ensured the productivity of his council by planning a major goal for them to achieve each year. That way both the principal and his reps realized a feeling of accomplishment.

Length of time on the council for rep members should be staggered so that while there is a continued infusion of new blood, there are also a number of experienced reps who stay on, thereby guaranteeing stability in the council’s operation.

✔ Marketing the Council

Since the success of any manufacturing venture can only be achieved via a comprehensive marketing effort, so too should the operation of the rep council. In other words, once it’s up and running, to give it a chance to succeed, see to it that it is constantly marketed to the entire representative sales force.

This can be accomplished through newsletters, having the manufacturer’s regional managers communicate the word in person, or having the rep members of the council communicate to their peers. In any event, the efforts of the council will be wasted if there is not a concrete effort to get the word out.

✔ Council Size

Function and representation should be the key words when considering how large — or small — to make the council. Keep in mind that if it is too large, it becomes cumbersome and difficult to accomplish tasks. When thinking of size, consider what it is you want to accomplish and then decide what number would be needed to get the job done.

✔ Continuity

If the council meets only once or twice annually, that doesn’t mean that’s all there is to the job. Before and after the formal meeting, the council should still be operating, whether it’s planning, communicating or implementing new plans.

✔ Location and Expenses

Finally, there are expenses and location to be considered when planning and scheduling your council meetings. Many manufacturers maintain that since they knew they were taking their reps out of the field and causing them to lose time in their territories, they felt it more than appropriate to take care of expenses. At the same time, that’s the same kind of reasoning that caused some manufacturers to occasionally conduct their council meetings at resorts — away from the plant — as a form of partial reward for the efforts their reps were making by their participation. However, many did emphasize the importance of holding the meeting at plants to allow reps to become more familiar with the manufacturing process and the personnel they are so dependent upon.

✔ Additional Considerations

Some additional considerations to keep in mind when thinking about your rep council include:

• When a small group of people gets together, there’s always the danger that someone has a personal agenda. Avoid that at all costs.
• Goals should be realistic and reachable. There’s nothing worse than a volunteer serving his time and realizing that nothing he did made any difference — that whatever was set as a goal could never be achieved.
• Responsibility and accountability should move to the fore. Be sure that each member of the council knows what their responsibilities are and emphasize the point that they are expected to follow up on all their assignments.
• In communicating the agenda, emphasize that each member of the council has the opportunity to submit topics that they feel are important.
• One member of the council should carry the responsibility to take minutes of all meetings and then follow up by communicating those minutes in a timely fashion.
• Feedback is critical to the successful operation of the council. As a result, manufacturers should let members know what they thought of the council meeting and they should require council members to provide similar input from their vantage point.
• Council members should be encouraged to work closely together and the manufacturer should make his personnel available to council members.

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Rep Councils Eliminate Us vs. Them Environment

By Jack Foster

January 2019

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Simple is always better and simple is just the way Charlie Ingram describes how and what a rep council is.

Ingram, vice president, sales and marketing for Eriez Magnetics, Erie, Pennsylvania, maintains that a rep council “is put together for manufacturers and reps to exchange ideas on how they can work better together to serve their mutual customers. In a nutshell, it’s all about discussing mutual challenges and deciding how best to improve your business practices.”

That was just part of the message delivered by MANA Board member Ingram and MANA-member Kurt Jacoby, Dempsco, Inc., Dayton, Ohio, as they participated in MANA’s teleforum on rep councils.

The one-hour teleforum session, which included questions from listeners, was moderated by Nicki Weiss, Sales Wise Academy, which teaches selling and influencing for engineers and other technical professionals.

Charles Ingram

Tracing his and Eriez’s experience with the rep council, Ingram explained, “When I joined the company, I had some experience selling through distribution and we had a distributor council. When I came here, it was important for me to learn how business worked and how to enhance our relationship with reps. That’s why we initiated the rep council in 1995 — and we’ve had one ever since.”

Among the many benefits that rep council has offered Eriez, according to Ingram, is the fact that “It eliminates the ‘us vs. them’ relationships between manufacturer and rep. When that kind of strained relationship exists, it just shows you that your respective sales strategies aren’t aligned. The rep council allows us to get unfiltered information back from the reps. As an unintended benefit, we’ve found that rep members of the council have been able to learn from each other how to improve their business practices.”

The Rep’s View

Kurt Jacoby

From his perspective as a rep, Jacoby notes, “One thing I’ve learned over the years is that all things being equal, it’s always better to have a rep council than to not to have one. It should be emphasized that based on my experience with Eriez, a rep council meeting shouldn’t be confused with a sales meeting. The meeting could very well include information on new products or marketing programs, but it’s not the kind of ‘rah-rah’ atmosphere you experience at a sales meeting. The intended goal of a rep council is to have a fair exchange of ideas and goals.”

If the benefits of having a rep council speak for themselves, Ingram stresses that at the beginning, if it’s going to work, it’s critical that the manufacturer get “buy-in” from its upper management. “The major challenge from day one is that in terms of the cost and value of the council, you get that commitment from management. That’s not only my perspective, but it’s what I’ve heard from other manufacturers.

“That was true for us, and we had to ensure that the council was going to be much more than just an opportunity for reps to complain about things. To accomplish the council’s intended goals, the manufacturer has to have a ‘rep champion’ in place to communicate the value of the council.”

As to how to achieve that upper management buy-in, Ingram notes, “I’m an excellent salesman. That was my job and I did it. In reality, our company CEO bought in as I communicated to him what I wanted to accomplish; what we wanted to discuss; what the agenda was going to be. Looking back, perhaps he thought he was throwing me a bone and believed this was going to be a ‘one-and-done’ deal, but that turned out not to be the case.”

He adds that his company’s upper management support for the rep council continues to this day. “They look very favorably upon the council and one reason for that is that we’ve marketed the value of the council to both our personnel and to our reps.”

Credit to MANA

Ingram gives credit to MANA when it comes to starting his company’s council. “I participated in one of the association’s day-and-a-half manufacturer seminars with the specific purpose of gathering information about rep councils. A great deal of pointers came out of that meeting, and I still remember what I learned to this day. One thing I learned was the importance of putting together an operating charter. For us, this is nothing more than a page-and-a-half of stated objectives covering what that the council is to serve as an advisory group to provide ideas and strategic policies. It goes on to describe rep membership, length of terms, and operating procedures.”

Membership on Eriez’s rep council comprises six reps and five participants from the manufacturer’s side. Reps serve a three-year term with two reps rotated off each year and replaced by two new reps. Meetings are scheduled annually at an off-site location away from both the manufacturer’s factory and the rep’s place of business with the manufacturer covering the reps’ expenses related to attendance.

If Ingram described the manufacturer’s responsibility in terms of establishing and running the council, Jacoby notes that each of the reps on the council is considered a team leader in that they are responsible for communicating with other reps working with the manufacturer. Jacoby is considered a “team leader” reporting to 10 other rep firms. “I’ll receive an agenda for an upcoming meeting. I forward that to my team and ask for their input. We’re open to their ideas, and those ideas don’t have to be strictly related to the agenda.”

Describing his time commitment for council activities, Jacoby says, “If I’m doing my job correctly, I’d say my prep time for a meeting is in the range of three or four days. In terms of attendance, I need to commit a day to fly in for a meeting, one day to attend, and then one day to fly out.”

Follow-up Is Key

There’s more to having a successful rep council than just planning for and conducting the meeting, however, and both men emphasize the importance of the meeting follow-up process. “Follow-up is something that Charlie and his team do extremely well,” maintains Jacoby. “It’s in that follow-up that reps learn what was discussed and that their input was important.”

Ingram notes that two things usually occur in the follow-up to a rep council meeting. “First is that as the host of the meeting, it’s the manufacturer’s responsibility to write up the meeting minutes, and we’ll provide several pages of information including any decisions that were made and any subjects that were tabled. A couple of months later, we’ll send something out to the field covering what actions are being taken as the result of a council meeting. The outcome is that you have an ongoing discussion. If you just attend a meeting and don’t communicate after the fact, it’s really just a waste of time.”

Rep Council Checklist

MANA’s teleforum on rep councils detailed the personal experiences of one manufacturer and a rep member. Over the years, Agency Sales has published any number of articles providing reps and manufacturers with guidance when it comes to establishing and running effective rep councils. Among the suggestions that have been offered on that subject are these:

Communicate Goals — In order to ensure that plans for creating and operating a rep council don’t proceed in a void, it remains critical to communicate its value to both manufacturer and rep members. Communicate with every person who will be involved. As to what should be communicated, start with the goals you hope to accomplish. At the same time, let all who will be touched by the council know what your role in the process will be. Once that’s accomplished, there won’t be any surprises as the process continues to evolve.

Selecting Membership — As described in the accompanying article, Eriez conducts its council with a mix of long-standing and relatively new reps. On the other hand, some manufacturers choose reps that have been with them the longest. The thinking with that approach is that reps know the manufacturer, his product, his personnel, and the marketplace better than anyone else. In addition to the knowledge that length of service provides, their tenure provides them with a willingness to participate in the process with a high level of candor and objectivity.

However, the feeling is that newer or less-experienced reps should not be excluded from the process as they can provide an entirely new perspective to the experience.

Council Size — No one size fits all. The major considerations when determining size, however, should be function and representation. Keep in mind that if the council is too large, it becomes cumbersome and very difficult to accomplish tasks. When thinking of size, consider what it is you want to accomplish and then decide what number would be needed to get the job done.

Length of Service — As Eriez’s Charlie Ingram noted in his comments, three-year terms fit the needs of his council. In general, length of service might be tied to how long it takes to get something done. Given that a manufacturer’s council will meet once or twice annually, it would appear that a one-year term is hardly desirable. Several manufacturers lean more toward a two- or three-year term.

Expenses and Location — Since manufacturers acknowledge the fact they are taking their reps out of the field to serve on a rep council, it’s more than appropriate that they pick up council expenses for the rep.

Follow-up — There’s no sense in conducting a meeting that looks for input from reps unless there is some sort of “call to action” following the meeting. That’s why it’s so important for notes to be written and circulated among manufacturer and rep personnel. And more to the point, if some action is called for on a specific matter, a deadline should be affixed and responsibility delegated for the action to be taken.

Marketing the Council — Just as the success of any manufacturing venture can only be achieved via a comprehensive marketing effort, so too should the operation of the rep council. That’s why it’s so important that once it’s up and running, the council should be constantly marketed to the entire representative and manufacturing sales force.

Continuity — It makes no sense to adopt a “one and done” approach when it comes to operation of a rep council. If the council meets only once or twice a year, that doesn’t mean that’s all there is to the job. Before and after the formal meeting, the council should still be operating, whether it’s planning, communicating, or implementing new plans.

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Listening When It Matters — Steps for Setting Up a Rep Council

By Sheldon Young

August 2016

Sheldon Young

Establishing a representative council can be a fantastic way to harness the powerful experience and knowledge of your sales force — creating an environment that allows for your most important and influential channels to provide you with insight and ideas. This, in turn, will allow you to better understand the market, as well as create the structure, tools and energy needed to engage your sales force, and direct your efforts to what really matters (and motivates) them to help you grow sales together.

Background — Standing Up Channel Management

Alfa Laval’s Process Technology Division, whose U.S. operations are based in Richmond, Virginia, is a world leader in heat transfer, separation, and fluid handling equipment. The company has used independent manufacturers’ sales representatives as the primary channel for heat transfer products in the United States for approximately 40 years. Some of their existing representative agencies have had the line for decades, so for many years Alfa Laval had a good pulse and level of familiarity with the sales reps, and the partnerships were very strong.

Over time, however, like anything in life and business, changes occur. Representatives retire or merge with other agencies, new faces appear at the factory, acquisitions occur, and organizational structures change. In the Alfa Laval Process Technology Division, while the performance and importance of the representatives remained intact, the focus on representative management and engagement had been absorbed within other activities. Formal channel management had become a side-of-desk activity belonging to a number of people that also had numerous other priorities to manage.

In late 2014, the division leadership made what they felt was a critical investment in managing their representative sales force by dedicating two full-time resources to channel management. The core responsibility of this team was to develop, grow and manage the representative sales force so that it would continue to be the best and most effective team in the industry. I was brought on to take one of these roles alongside another employee.

Why a Rep Council?

With strong support from leadership, one of the first key steps that our new team agreed upon was that it was vitally important to harness the collective experience and input from our representative force. This would be done in a number of ways, including regular performance conversations, trip reports, and surveys. What the team decided right away, however, was that it needed to use one of the most effective ways to obtain honest and valuable information — the rep council. With a very aggressive agenda for growth, it was critical that the representatives and the manufacturer worked as closely as possible to build the strategy and remove barriers. Honest conversation and engagement from the representatives were going to be key to help Alfa Laval make the best decisions to continue to succeed.

The division had established rep councils in the past, but it had been a number of years since the last operational council was in place. The experience within the team related to effectively establishing and conducting a representative council was limited. What was realized though was that this absolutely needed to be done right, and no member’s time could be wasted. Our team started internally by having a conversation with another business unit of Alfa Laval. The Sanitary Equipment Segment of the company had effectively been conducting what they called Distributor Vision Councils for a number of years. They had also developed a survey for their distributors that provided some interesting thoughts on what information we might want to collect to help inform our council on areas requiring attention. While the topics were a bit different for a distributor population, the general framework was a good place to draw some initial ideas. Our team now had some guidance, but it was still a little unsure about the details of how to set up and manage an effective council meeting.

While doing some research on resources available for representative management, I discovered MANA. After a quick look at the materials and a test run of the tools, we joined the association right away. Within its tools available for manufacturers, I discovered articles, a sample operating charter for a rep council, and a fantastic special report on building an effective rep council. We were able to both verify what we thought we knew, and to gain new insight and ideas to consider when building the rep council that we wanted.

Building the Foundation

Once we had committed to having a rep council, the real work began. Our channel management team pulled together a high-level plan and kicked off a planning meeting with the leadership of our division. From that meeting we made some critical decisions that laid a foundation for our planning.

• Creating Focus on the Goal

When you peel away all of the meetings and presentations and conversations, the purpose of having a representative council was really only about one core objective: Find ways to grow profitably together. Yes, we would talk about issues, ideas, commissions, communication and a number of other topics, but if our activities don’t lead to growth and profit for all parties, then it probably wasn’t worth the time spent together. Hence, we created our first guideline for the meeting — whatever recommendations came from the meeting had to tie back to helping us grow profitable business. When you think about it, it’s not that hard to do. What this focus does, however, is make you think about how you execute on a plan and what you focus on. Placing a focus on a core objective or mission can set the tone for the meeting and really help you set an impactful agenda.

• Calling the Event a Rep Vision Council

Right out of the gate, we wanted to create a sense of partnership and importance to this team. The representatives that we were selecting for the council would be part of advising on important decisions that helped influence our go-to-market strategy. Taking a good idea from our Sanitary Equipment colleagues, we chose to call our meeting a Representative Vision Council, or RVC for short. We expected the members of the RVC to be part of the vision we have for the division, and putting that in the meeting name highlighted the importance of their involvement. Labels can matter when you want to convey importance.

• Establishing Internal Commitment

Making this RVC a success was going to require a lot of work, but it was going to require something even more important — commitment of time from our top leaders. A meeting with the channel management team and the rep council members, but with little participation from senior leaders would make the meeting a failure. With the leadership of the division, we obtained commitments from the president of Alfa Laval USA, along with the heads of operations and our service division. We took great care to keep the manufacturer-to-rep ratios low, and the discussion intimate. Be very careful about not overwhelming the rep members with too many factory people.

• Selecting Membership

The team spent a good amount of time discussing who should be the representative members on the council. Since this was the first meeting in many years, we felt that the initial membership should be mostly experienced reps with some geographic diversity. We ended up selecting four of our long-time reps, and offered them terms ranging from two to four years. Each RVC member has six to eight rep agencies for which they are responsible. It is a possibility that we will add a fifth member, depending on the number of channels we have in total. This fifth member, or when we roll off our first inaugural member, is when we would consider a newer or less-seasoned rep for the council. Having reps with good experience and rapport with your company, as well as an open and honest attitude can be valuable for a first rep council, but don’t be afraid to mix it up as time goes on.

• Setting Expectations for Members

Once we had selected our members, we made sure that we had personal conversations (along with invitation letters) with each of them. The goal of the conversations was to ensure that they knew that their selection and participation were important to the organization. It was also to discuss the expectations and commitment from their end. They would be expected to engage in several conference calls to work with channel management on setting the agenda, as well as conduct sessions leading up to RVC with the representatives for which they were responsible. They were also expected to arrive the evening prior to the combined rep council session to prepare a presentation of their combined findings as well as recommendations. It is important for the representative to have a stake in the outcome, and be prepared to work on solutions.

• Adding Data to the Conversation

A quote to rely on when gathering information is “Trust, but verify.” I trust our representatives to bring good issues and information to the table, but I also know we are all human, and our biases and personal agendas can sometimes cloud the message. We wanted to make sure that we had the thoughts and opinions of all of our representatives on a wide variety of issues. Our team created a survey that could be taken electronically (and anonymously!) touching on a number of areas we were curious about. Working closely with the RVC to review the content, we launched the survey and collected some fantastic data that helped shape the agenda. We shared the results with the RVC members who used the information to guide conversations they had with their constituents. Data helps steer the conversation toward the most pressing issues.

• Structuring the Meeting

The importance of building a strong agenda with plenty of time for dialogue can’t be emphasized enough. Right away, we set the rule that “presentations” would be very limited, and most of the time would be spent with the representatives presenting findings from their meetings, and in working together to develop recommendations. Only a couple hours of the day-and-one-half together would be Alfa Laval leaders sharing information about strategy or new products. Much of the time would be spent engaging in dialogue on the topics, in working groups to generate recommendations, and just listening to what they had to say. The rep council was to do a lot of the initial talking, Alfa Laval the listening. Then together we would develop ideas and recommendations that the reps would present to our senior leadership team. Trust the rep to bring ideas that will make a difference in your mutual success.

Coming Together

• Logistics

As we learned throughout the process, there is a lot more than just the meeting agenda to consider when setting up a rep council meeting. We started planning several months before the actual meeting and were glad we did. Getting on a senior executive’s calendar can sometimes require a very long notice. Since Alfa Laval covered all of the expenses for the meeting, planning, hotels, reimbursements, meals, the special event, and just keeping everyone on track in preparation of the meeting took many hours of work. Even just remembering simple items like easel pads and markers for the meeting was another to-do that can easily be missed. Many things “popped up” last minute, but because we had planned well we were able to pull off a very smooth meeting logistically. Also, don’t forget to speak to your leadership the year prior to your meeting so that you can plan a budget for the event, as the dollars can add up quickly. Prepare early, and thoroughly, so that logistics are never an issue.

• Executing the Meeting

The RVC meeting occurred in early October 2015. We kicked off with some opening remarks from our leadership and then set up what is key to any good meeting — setting ground rules. The agenda was our guide for the rest of the RVC and we did everything possible to stick to it. An individual was assigned to take notes, and we established a “parking lot” for items that were maybe off topic, but we wanted to address at a later date. We handed out “yellow cards” to everyone in the room that could be held up if they felt that the conversation was going off topic. While they were used infrequently, they got the point across in a respectful (non-interrupting) way when necessary. To maximize the time we had together, once we established topics, they were prioritized, and two separate breakout groups were formed. There was a mix of reps, operations, and salespeople in each group (but not executive leadership), and a channel manager was assigned to each group to help facilitate discussions. Each group took two or three topics, and then worked for a couple of hours on recommendations. Then the whole group came together and agreed upon a joint set of overall ideas. On the last day, the reps presented the recommendations to the executive leadership, who provided feedback to the ideas as they were given. We finished the RVC with a “what worked and what didn’t” session so that we can continuously improve, and then there were closing remarks from the leadership team. Structure, rules, and sticking to the agenda led to productive outcomes.

• Fun, Appreciation and Memories

As the adage goes “All work and no play….well, kinda stinks.” While we wanted the majority of the time to be about working together toward profitable growth, we also wanted to make sure we all had the opportunity to bond around something other than work. Since we are all salespeople, we decided some friendly competition was in order, so we teamed with a local cooking school — Mise en Place — to create an “Iron Chef” like cooking challenge. It was a fun and engaging way to let loose and have a good laugh, along with some great food. Also, we provided everyone involved in the RVC branded shirts which we all wore for a group photo. We provided copies of the photos for everyone in a frame with the event name. Having fun makes work feel easy.

Results, Alignment and Follow-Through

Everyone in attendance considered the first annual RVC event a great success. They were encouraged by the great dialogue, high productivity, and commitment to the process. Everything went well, but we weren’t done yet! All of the hard work that goes into a rep council can be undone if you fail to do the most important thing — follow through. After the RVC, the Alfa Laval team formalized a series of projects to evaluate the recommendations and take actions with those we felt we could tackle with our available resources. Six projects in total have been launched, and as of March 2016 we have delivered results on most of them. Two are actually ready to be closed out already because all recommendations have been acted upon. We regularly engage the rep council members, and report project progress in a quarterly newsletter to all channels. We are planning our next meeting for later this year, and are excited about what it will bring. Always, always, always follow through.

We can conclude the story of our rep council journey by summing up the key takeaways from this article. We consider our first rep council meeting a great success, and we hope that this story helps you step up and harness the value from your most important source.

Keys to a Great Rep Council

• Use various resources, such as those provided from MANA, for ideas and frameworks.
• Placing a focus on a core objective or mission can set the tone for the meeting and really help you set an impactful agenda.
• Labels can matter when you want to convey importance.
• Be very careful about not overwhelming the rep members with too many factory people.
• Having reps with good experience and rapport with your company, as well as an open and honest attitude can be valuable for a first rep council, but don’t be afraid to mix it up as time goes on.
• It is important for the representative to have a stake in the outcome, and come prepared to work on solutions.
• Data helps steer the conversation toward the most pressing issues.
• Trust the rep to bring ideas that will make a difference in your mutual success.
• Prepare early, and thoroughly, so that logistics are never an issue.
• Structure, rules, and sticking to the agenda lead to productive outcomes.
• Having fun makes work feel easy.
• Always, always, always follow through.

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Manufacturer Fine Tunes Its Rep Council

By Jack Foster

July 2016

More than 10 years ago when Howden North America was singled out by a MANA member as a “Perfect Principal,” the company’s dedication to its network of independent manufacturers’ representatives was evident. Howden, headquartered in Columbia, South Carolina, designs and manufactures large fans and blowers, rotary heat exchangers and process gas compressors for utility and industrial applications.

© denisismagilov | stock.adobe.com

When the manufacturer’s relations with agencies were described in the July 2005 issue of Agency Sales, the views that agents had of the manufacturer were very positive.

For instance, consider these words from one agent: “Howden has a well-established methodology for dealing with sales reps and, in my opinion, they are very rep friendly — much more so than any principal we’ve ever dealt with….They don’t go around us or leave us out. They include the sales rep as an integral, long-term part of their business.”

Based on recent interviews with both the manufacturer and two of its independent agents, it doesn’t appear that philosophy has changed much over the years, especially considering the company’s recent efforts in the area of reinvigorating its rep council.

Dave McDowell

A quick look at the manufacturer’s history will show that over the years it has acquired 30+ fan manufacturers. Then, according to Dave McDowell, director of sales for Howden North America, “In 2012, we were acquired by the Colfax Corporation, a company that was very aggressive in terms of acquisitions. They immediately wanted to establish a high-strategy initiative to double our after-market business. In line with establishing that initiative, we decided to change our route to the market. All the acquisitions that had occurred resulted in walls being built up around our products. We would have six or seven product guys calling on customers. That just wasn’t an effective way to go to market.”

Improving Trust

At the same time, the company determined that “our independent sales reps had reached a point where they didn’t always trust us. We had walked away from the industrial side of the business and many of them found that we were resistant to change. That’s when my boss and I got together and determined we had to change our route to the market. As a part of doing some things that we hadn’t done before, we felt we had to involve our reps more in the process.”

McDowell continued that to improve communications with reps, “One of the first things I did was to go out in the field and meet with our reps. I explained that we had a regional manager in place to serve as their ‘champion.’ His job was to be right at the rep’s hip in his dealings with customers.”

In meeting and communicating with the company’s reps, McDowell explains that “We let them know how important it was that we share expectations and establish a performance review process. At the same time, we let them know that because they’re independent representatives, we can’t tell them what to do, but we can communicate our expectations and provide feedback. My overall message was that we want to grow with our reps.”

Council Starts Slowly

McDowell explained that as this process was unfolding, the prospect of having a rep council developed. “So we did just that,” he said. “We started off slowly with maybe six meetings over the first couple of years.”

In detailing what the manufacturer hoped to achieve, McDowell said that “What we were planning on initially was — as much as possible — to have at least one rep from each of our sales regions. Second, we were looking to have representatives from both our power and industrial sides of the business. We felt that would give us the type of mix that would work well for us.”

Over the course of the first few meetings he said there was a lot of discussion — constructive criticism — about what the company was doing wrong. “What was missing, in my opinion, were suggestions about what we should be doing moving forward.” In addition, McDowell also pointed out that perhaps one of the early failings in this effort with the rep council was the apparent absence of top management support on the part of Howden. “From my perspective, the only way a rep council will be truly effective is with that top-down support from management. Early on in the course of our discussions with our rep members, one of the points they continually mentioned was they weren’t convinced we were committed to them. That’s why management support is so critical.”

He adds that since those early rep council meetings, the company now has a new CEO who is showing the type of support he maintains is necessary. “Our new CEO is the real catalyst behind this effort,” he explained. “He’s been on board for a few months now and our reps already like what they see. For example, we had a town hall meeting with 10 reps. He spent half a day with them one-on-one going over all the issues the reps have with us.”

In addition to strongly recommending other manufacturers have a rep council, McDowell added two final thoughts on the subject. “To be truly effective, I think you have to view the rep council as an important extension of your partnership with reps. It’s a healthy and valuable forum that can encourage growth. Always be open to the constructive criticism that will develop and don’t be overly sensitive to what you hear from your reps. Encourage the rep members of your council to be open and vocal with their views. That’s the only way both sides will benefit.”

If Howden’s Dave McDowell is a big believer in the effectiveness of a rep council, he’s hardly alone. Two of the council’s members echo his desire to provide an arena for constructive criticism that can only help the manufacturer and its network of independent manufacturers’ representatives.

Sam Harman

In general terms, Sam Harman espouses a philosophy that recommends rep councils. “I’m a big believer in them,” says the president of H. Clay Moore & Associates, a firm that was profiled last month in Agency Sales. According to Harman, “Rep councils can be a great asset. When a company decides that it wants to have a rep council, they do it for a reason. Obviously, there’s someone in the organization that sees some benefit and wants feedback. Having said that, however, how it’s run and managed are critical. There has to be a give and take between the rep and the manufacturer if anything substantial is going to be accomplished.”

The Atlanta, Georgia-based H. Clay Moore & Associates serves a variety of customers in the Southeast including electric utilities, pulp and paper mills, municipal waste water treatment plants and general industry.

Harman continued to describe his own experience with Howden’s rep council, which he admits is fairly limited given the fact he only took on the presidency of the rep firm a little over a year ago. “As an agency, we’ve been on the council for a fairly long period of time. Typically it’s the rep firm owners who attend council meetings.”

Positive Beginning

He continued that when he took over as agency president, his predecessor gave him an inch-thick folder of minutes and notes for the first meeting. “My impressions of that first meeting were positive. Primarily that the comments and contributions from council members did not fall on deaf ears. I believe there was a mutual appreciation for the fact that whatever problems and concerns exist, they are not easily solved and will take time.”

Harman explains that he appreciates the fact that it can be difficult for a large manufacturer like Howden to quickly make changes. “When you run a rep firm which is quite small compared to a manufacturer, you can make changes on a dime. A manufacturer, on the other hand, needs more time to change their processes. That’s why when various subjects come up at a council meeting, you can’t expect most of the problems to be solved right away.”

When it came to reactions to suggestions made by council members, Harman explains that he and the other members really didn’t experience much push back from the manufacturer. As an example, Harman pointed out that the manufacturer belongs to a lead generation organization. “In discussions on that subject, given the fact that that is an expense for the manufacturer, they wanted to know from us whether that was valuable. In addition, they asked where and how they should advertise? What trade shows should they participate in? They were genuinely looking for useful information from us.

“I think the feeling was that the council had reasons for pointing out various problems and their intentions were genuine. For instance, if a problem was pointed out and the manufacturer disagreed, they’d take the time to explain the situation from their perspective and go on to detail why certain things really can’t be changed. All in all, I think there was an open and honest communication between reps and manufacturer. You have to remember that if Howden didn’t believe the rep council was worthwhile, they’d do away with it — and they haven’t done that.”

Just as H. Clay Moore’s Harman, Ken Hall, Power Quip, Ogden, Utah, touts the value of the honest give and take and open communications that Howden’s rep council provides.

Power Quip, headquartered in Ogden, Utah, has a staff of nine full-time employees, and represents manufacturers who service the power industry in nine western states.

According to Hall, “What Howden does with its rep council shows that the company truly values the reps’ feedback. More than anything, they feel what we’re doing for them is valuable and they want to hear what we’re doing and what we have to say. Even though there can be a lot of redundancy with subjects that are brought up at council meetings — especially if changes aren’t made — I feel they’ve been grateful for our contributions.

Reps as Customer Voice

“Perhaps the most important contribution that reps can offer is by serving as the voice of the customer. Manufacturers always want to know what the customer is saying. We as reps, interact with customers on an everyday basis. In the past, I think Howden has had a desire to speak directly with the customer. Now with the input they receive from us via a rep council, they don’t have that need.”

In recounting some of his history with the manufacturer’s rep council, Hall explained, “When Howden approached me to serve on their council about three years ago, I described for them what I experienced with another manufacturer that had a very formalized rep council. That company, which has had a council dating as far back as the 1930s, has three reps serving as permanent members on rotating three-year terms. Other reps on the council are considered junior members.

“What Howden has is slightly less formalized, but as it has developed, it’s been a very good experience for us. For the most part, the last two meetings have been very effective and the company’s new president has been especially engaged in the process. In general, they receive comments from rep members as constructive.

“It’s been especially beneficial because the manufacturer has gone through a good deal of merger and consolidation activity. As a result, a number of concerns have developed that should be addressed by the rep council. The key, as with anything like this, is to make sure you have a formal agenda and that the sessions remain constructive. You can’t let them become complaint sessions where nothing is really accomplished. I can draw from my experience with some other rep councils I serve on where beforehand we solicit both positive and negative input from reps. Then we present that input at the meeting and allow the manufacturer to provide feedback. That’s a process I think I’d recommend to other manufacturers.”

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Real-World Tips for Effective Rep Councils

By Jack Foster

March 2015

With service on four rep councils under his belt, John Beaver is well qualified to offer his opinions on whether those bodies serve the needs of manufacturers and their agents — not to mention their mutual customers.

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Beaver, president, GSA Optimum (www.gsatech.com), Oakdale, New York, works with a group of industries including aerospace, military, power supply, security, telecommunications and others. In that capacity he has been asked to serve — and serve he has — on four rep councils, including two that he presently chairs.

From the outset, he maintains, “The number-one benefit of the rep councils for me and the agency is the ability to network with fellow agents and with our mutual principals.” He continues that even if the networking opportunities are minimal, that’s still enough to make participation worthwhile

Two Types of Councils

In general terms Beaver offers that there are probably two categories of rep councils. One is where the principal and agent recognize and achieve the true benefits of the effort. The second might very well be a council where the benefits aren’t so recognizable and the principal spends a good deal of time talking about themselves without seeking much input from the agent members.

Concentrating on the first category, where both sides realize the benefits, he says that “From my experience these councils have been put together very carefully by a company’s national sales manager. In creating the councils, the successful ones aren’t made up of just their biggest and best rep firms; rather, they’re a collection from the rep network that offer some diversity. And the membership representation on the council isn’t always just the rep firm owners, it’s others in the agency. For instance, you might have ownership of a larger and smaller firm, complemented by someone from a one-man firm and then the typical ‘worker bee’ who is not an owner from another firm. On one of the councils I serve, there are only two agency owners. Everyone else fills a different position.”

When there’s such a diverse collection of agent members, Beaver maintains, “a real dynamic is created and you get past titles in a hurry and start getting things done.”

Typically, he says, such a council will get together on an introductory conference call prior to the first face-to-face meeting. “Since no one really knows the pecking order, there may be a little shyness at the beginning. It’s important to get to that first face-to-face meeting because that’s where you start building trust in each other and relationships are established.”

Once a rep council is put together and operational, Beaver offers some suggestions to both independent representatives and principals on how to optimize council operations.

For principals:

Agendas — “Always work with an agenda. In fact, principals and agents should come up with separate agendas and merge them. This is easily done via e-mail.”

Council membership — “Be careful to select from a broad spectrum of rep members. You don’t want just the biggest and best.” In addition, Beaver cautions that “If an individual is argumentative, he’s not the right person to serve on the council. You don’t want meetings that dissolve into personal disputes. You never want a member of the council to discuss specific problems he’s having with a principal. You should seek a membership where the rep members realize they are there for the entire rep network.”

Meeting locations — “Ideally, in my opinion, I’d suggest alternating council meetings between the manufacturer’s headquarters’ location and another location that’s easy to travel to (e.g., Chicago).”

Meetings — “Meetings should be well-organized and planned well ahead of time. Encourage rep members to meet on their own and always allow the council plenty of time to meet on its own prior to the formal meeting. My preference is to begin a meeting at breakfast for an hour or so.”

In addition, “Manufacturers should recognize that the rep council meeting is not a sales meeting. As a result, the manufacturer should be careful not to dictate all that goes on during the proceedings.”

Expenses — “Typically airfare, room, board and entertainment for rep council meetings are on the manufacturer.”

For representatives:

Communication — “Prior to a rep council meeting, members of the council should communicate with and solicit issues from members of the rep network. It’s important to divide up work among council members and have each member be charged with communicating with specific reps. Following the meeting, the same type of communication should be completed with all members of the rep network being informed about what went on.”

Beaver adds that in terms of communicating with other agents in the rep network, “We’ve had the council members personally meet with other agency owners. That lets them see who we are and learn what we do. In addition, I would also suggest that the rep council chairman address some part of the manufacturer’s sales meetings.”

Meetings — “A truly effective rep council is one that meets without the principal even saying you should meet.”

He continues that during the course of the meeting “All rep council members should remain respectful of the principal. The meeting is not the time or place to take up personal issues. Stick to the agenda. Also, don’t go after any of the principal’s sacred cows. Stay clear of personal issues.

“If you know of anyone on the council who has a tendency to be argumentative or take up personal issues, coach them ahead of time to avoid that practice.”

Beaver emphasizes that during the meeting and afterward, it’s important that whomever chairs the rep council “gives credit to anyone who has come up with an idea. It’s important that those who have contributed are recognized.”

Beaver stresses that with some council meetings, there’s a tendency to include golf or some other activities. “Personally, I’m a ‘worker bee.’ I like to get in for the meeting, get it done and then get out of Dodge.”

Council Benefits

As he surveyed his present and past experience with serving on rep councils, Beaver clearly sees their benefit: “I’ve been able to get some changes made with commission structure and contracts. But more important, I’ve been able to get new lines and learn how to run my own agency better. I’ve also learned a great deal about the companies I represent and how they’re run. In addition, the contacts I’ve made have resulted in lasting friendships and allowed me to bond with other reps.”

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The Case for Rep Councils

By Jack Foster

March 2015

© Monkey Business Images | Dreamstime.com

If the previous article details some of John Beaver’s thoughts on the value of rep councils, it also provides an example of the validity of what MANA has been preaching for years.

A quick search of the association’s special reports and Agency Sales magazine’s archives will show that the message that has been consistently communicated is that rep councils can be a critical ingredient in the relationship between manufacturers and agents.

Not surprisingly, when manufacturers and independent manufacturers’ representatives who have experienced rep councils are asked their views, they are remarkably similar. For instance, when an agent in the southeast is asked for his opinion, he says:

• “Two of my principals who asked me to serve on their rep councils did so because they recognized it was a good business practice. They were looking for knowledgeable and timely input from their rep network and the rep council was the ideal vehicle to get the job done.
• “A third principal, on the other hand, initiated their rep council for the simple reason they were in trouble. They weren’t shipping, delivering or performing well for their customers or reps. Their hope — which was realized — was improved performance after receiving input from their reps.”

If that’s the positive response from an agent, a fairly typical manufacturer that started its council 16 years ago says, “Our primary purpose was to take advantage of a consensus from a small group of people whose views we respected.”

Diversity of Participants

When it came to putting the members of the council together in order to achieve that consensus, he explains, “They all weren’t our highest performing agents in terms of turnover and sales; rather, they were individuals we hold in high regard in terms of the industries we are involved in.”

In addition to seeking highly regarded individuals, the manufacturer explains that the “vocal can also apply.”

“I’m always on the lookout for people who have an opinion and are willing to voice it. I’ve always made it a practice to make sure I know the agent we were going to ask to participate would accept the invitation. In addition, we were going to steer clear of anyone who was going to vocally hold back during meetings.”

If choosing a diverse and vocal group of independent manufacturers’ representatives is part of the best-laid manufacturer plans for councils, not everything always works out as planned. Here’s how one agent described a less-than-desirable experience: “Two weeks after returning from our semiannual rep council meeting, the principal suddenly announces sweeping changes in their sales and marketing program — changes that were never discussed during the council meeting. At the same time they announced their changes, they said, ‘We need your feedback.’ My response was: ‘No, I need your feedback. What’s going on here? Why wasn’t this brought up at the council meeting? That would be the time and place for our feedback.’ I can’t think of a better example of how not to make use of a rep council.”

Organization and Direction Wanted

Or, how about the view of another agent who says, “I can’t think of how many times I’ve attended council meetings when the manufacturer didn’t maintain control. They provided no agenda, allowed their reps to run helter skelter and absolutely nothing was accomplished.”

Conversely, when the manufacturer does maintain control, provides an agenda and direction, praise never seems to end. Consider these comments:

• “Council meetings serve as a vehicle where concerns or problems reps may have can be addressed in an organized manner.”
• “Regular council meetings provide the manufacturer with the opportunity to learn firsthand from us what’s going on in the field. Then there’s the opportunity to learn what the competition is doing when they hear it firsthand from their rep network.”
• “It’s all about communication. We learn exactly what’s on our principal’s mind and they learn all about what’s happening in the territory from us.”

To get to the point where pros and cons of a rep council can even be considered, however, there’s the need to put one together in the first place. To achieve that goal, a number of steps must be completed.

Communication

As stated above, communication is the key here. Communicate with all who will be involved with the operation of the council. Start by communicating the goals that are hoped for. At the same time, let all who will be touched by the council know what the manufacturer’s and the agent’s roles will be.

Select Participants

As John Beaver described earlier, not only the top-performing agents should be included in the membership of a rep council. Diversity should be the key.

Several manufacturers have maintained that they’ve found more positive results by choosing agents to serve who have been with the manufacturer the longest. Those agents know the manufacturer, his product, personnel and the marketplace better than anyone else. In addition to the knowledge that length of service provides, their tenure also will provide them with a willingness to participate in the process with a high level of candor and objectivity

The newer or less-experienced agent, on the other hand, should not be excluded from council participation. At the beginning, however, it’s often helpful to have the more veteran agents available who can assist with getting the process moving.

When considering manufacturer representation on the council, appointees should be senior personnel who carry the appropriate titles. At the same time, they should be empowered to make decisions on behalf of their company without having to check with higher ups.

Determine Size and Length of Service

When thinking of the size of the council, consider what it is that is to be accomplished and then decide what number would be needed to get the job done.

Just as important as size is length of service. When determining how long an individual should stay on the council, ask the question how long it will take to get the job done. Considering that a manufacturer’s council will probably meet once or twice a year, it would appear that a one-year term is a bit short.

Staggering an individual’s length of time on the council might also be desirable. Such a process guarantees that there will be a continued infusion of new blood. At the same time, there will be a number of experienced reps who stay on, thereby guaranteeing stability in the council’s operations.

Expenses and Location

Most manufacturers recognize the fact that they’re taking their reps out of their territory and away from business. As a result, it’s their feeling that they should take care of expenses. At the same time, many manufacturers eschew the use of resorts for council meetings and choose factory locations or even hold meetings in conjunction with national sales meetings. This decision allows agents to become more familiar with the manufacturing process and the personnel they are so dependent upon.

Continuity

Manufacturers and agents agree that there’s no sense in establishing a rep council for the short term. It should fit into both sides’ long-term planning. At the same time, if the council is meeting only once or twice a year — as most do — that doesn’t mean that’s all there is to the job. Before and after each formal meeting, the council should be operating, whether it’s planning, communicating or implementing new plans.

MANAcasts

MANAcasts are conversations with people who know the topic.

• Working With Rep Councils

PODCAST

• Business Networking Group 2.0 – The Rep Council

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