Why Choose an Agent?
Sales agencies in Australia come in many shapes and sizes, starting with the single commissioned salesperson right up to multinational merchandising corporations that employ hundreds of part-time employees. The service they provide also varies.
At one agency, the level of service may stop at visits to local independent stores while at another, it may extend to vendor in-store service. Bigger agencies can even merchandise, warehouse, pick, pack, deliver and invoice on behalf of their clients. The question, therefore, is which agent – or, more specifically, which level of service – suits your business?
There’s certainly a wide range of choices available within this ‘black economy’. It’s estimated that more than 2,000 third-party merchandisers service just one corporate hardware retail chain on behalf of hardware suppliers.
Modern technology now allows third-party merchandisers to record their activity at store level and report it back to suppliers in ‘real time’ through photos of relays, orders taken and time spent on a given task. What was once a stand-alone server application costing tens of thousands of dollars to implement and maintain is now a PDA web-based solution that can be accessed for as little as $100 per month. Clever sales agents are now marketing these services as an additional benefit, allowing total transparency of what they do for their money.
So, do I employ more sales representatives or appoint an agent? It’s a question many sales managers ponder when faced with the need to expand their presence in the marketplace. There are pros and cons with either scenario, but Stephen Keany, managing director of Force One, believes the pros vastly outweigh the cons when it comes to quality agents.
“If you need to value add to your existing sales force or completely restructure it, an agent will give you a cost effective, quick-to-market result,” he explains. “Whether you need to ‘rent’ an agent when you need one or employ a variable cost solution, an agent can give you access to professional sales people and merchandisers Australia-wide.” Keany outlines four main areas where quality agents can deliver superior results against a company’s own representatives:
- CustomersAgents already know your customers, they are already visiting your customers and they are already generating sales with your customers. Therefore, you do not have to wait until your company representative builds up a rapport with your customers. The sales agent is actively working for you by gaining sales from Day One. Call frequency may also be shorter with an agent, as he has multiple reasons for visiting your customer. If your representative visited every week, the customer may feel like they’re being ‘stalked’.
- TrainingAgents require minimal training, because the nature of representing several companies gives them a broad knowledge across many product groups. They may also have represented similar products in the past. Their assumed knowledge should not be underestimated.
- Market IntelligenceAgents often have access to several sources of market intelligence, past principals, company sales representatives and, of course, customers. Traditional agents have always needed to keep their ear close to the ground to source new clients. They have therefore developed large networks of contacts that spread across market segments.
- CostAgents can be more cost-effective than employing your own representatives. For example:
- The agent handles all of the HR issues – hiring, firing and training.
- By paying an hourly rate, you only ‘rent’ the agent when you need them, thus eliminating unnecessary downtime.
- Costs are variable when you pay on a commission basis, i.e. if it is a slow month, the commission is smaller. Your cash flow also benefits by removing the fixed costs – salary, car, phone, etc. – of a representative.When looking for an Agent for your company, you need to ask the following questions:
- Do they have the capabilities to carry out the tasks required?
- Do they employ fulltime or part-time staff?
- What reporting systems do they have in place?
- Are they flexible enough to allocate more resources during seasonal campaigns or national store refits?