Some popular options are:
I. Selling yourself
II. No selling but focus on word of mouth
III. Using Distributors
IV. Hiring a salaried Rep
V. Hiring an Independent Rep
Before I begin, I'd like to outline that I have had previous experience in each area I am speaking about. I have experienced being an Independent Rep, as well as a salaried rep and then the business owner trying to decide which path to ultimately use to go to market.
I. SELLING YOURSELF: Many small door manufacturers opt to sell their doors themselves. This can be a great option, however there are many things to consider. Did you start your door business because you are skilled at selling doors, great at manufacturing, or because you enjoy all the aspects? No matter how good of a sales person you are, it is impossible to run a company and to still affectively perform the sales job properly. Assuming that you wish to continue to grow your business, it may be imperative to get assistance in selling.
II. WORD OF MOUTH: There are many door producers that really just rely on word of mouth and their past business dealings to drive the business to their door. When any downturn comes in the market, you will notice that those who are aggressive in going out to get the business will be the ones to maintain it.
III. USING DISTRIBUTORS: We all know that there are thousands of small Kitchen producers, closet manufacturers, refacers and remodelers across the country. Small and large, the majority of these companies buy from local distributors. These local distributors typically have a client base of at least 1,000 companies for each warehouse branch in operation. These distributors typically have salaried sales people, milk run delivery schedules, large accounting, operations and warehouse staff. Distributors specialize in handling small, detailed orders but they also specialize in extending credit and collections. Since these small shops need so many items from their local distributor it is critical that they keep paying them. This close relationship creates a symbiotic relationship that is necessary in order for both to survive. Although working with distributors are not for every door manufacturer, I'm a big believer in using them. On average, I have found that many smaller accounts are fine with paying an extra few dollars per square foot for the convenience of dealing with these distributors. The customer would never admit it however the amount of 3D Laminate doors sold through distribution is evidence enough.
One of the key fears that most door makers have in working with distributors is that they'll lose the connection with the customers. There is a fear that if the distributor drops them, they will lose their business.
The biggest fear that distributors have is that they will inject time and money into selling doors and then the customers will, in the end, bypass them and buy direct. Distributors often ask for protected territories to seclude the customer from going direct.
In all manufacturing or distribution there is a cost of doing business. It is not feasible to give the same pricing for 20 doors as it is for a block of 200 or even 2000 doors. The administration and billing required for many single kitchen orders is a high price to pay. It is important that both the thermofoil door manufacturer and the distributor agree to a workable relationship that will benefit all parties involved.
One option open to door manufacturers is to set up pricing that leaves a 30% margin for the distributor, but no territory protection. You can explain that if a customer comes to you then they'll be paying a higher price on a single kitchen order and since the distributor is bundling orders they'd be protected. Essentially the small door buyer would pay the same even if they came direct. Another option would be to private label for the distributor. This would assure that their business was based upon their merits and vice versa. And finally another option would be to give some exclusive door styles to your distributor. Even a slight different shape in the door would make it difficult for the distributor's customers to buy direct. This is not a common strategy but it gives you some ideas of negotiation between you and a distributor.
I do recommend, however, working with larger and more stable distributors who are focused on the cabinet industry already.
IV. HIRING A SALARIED REP: Another option to getting your doors into the market is via a salaried sales rep. The great thing about salaried sales reps is that you have more control over their time. It also gives you greater flexibility to redirect their efforts from cabinet shops to closet companies or to new industries all together. Salaried sales reps can also roll their sleeves up and help in customer service for the day. In general, using salaried reps gives you the most attention and commitment to your company.
V. HIRING INDEPENDENT REPS: This is probably the least understood area by thermofoil door manufacturers. Some companies have said that they'd never go back to Salaried Reps, yet others say that they'd never use an independent rep again. I'd like to explain the nuances behind what makes the Independent Rep / Thermofoil Door Manufacturer relationship work....
First of all, it is possible to use a combination of Salaried Reps and Independent Reps. Actually its more affective to have Independent Reps reporting to Salaried Sales Managers who understand sales and can travel with and train Independent Reps. This seems like doubling up however it does have a more proven track record.
There are two types of Independent Reps out there. The ones that carries multiple lines and the ones that do not carry any other lines. Being an Independent Rep takes a special breed of sales rep. First of all they must be able to work with little management, willing and able to spend their personal money to develop the territory and disciplined not to spread themselves too thin. You will find that the only thing worse than a Rep that has too many lines is one that is unable to make a living with your line alone.
The key to being successful with Independent Reps is communication. You must properly train them, travel with them and let them know that you expect results. We've all heard the adage that the squeaky wheel gets the oil... Independent Reps will naturally gravitate to the lines that give them the most attention and the ones easiest to sell. I recommend communicating heavily with your Independent Reps so that you can show them how to sell your doors more effectively. If you show them the nuances and they become more educated about your line then your line will be the easiest for them to sell. Its common sense, but all too often companies think that they just need to give them samples and they'll be off to the races. Believe me, this is the exception not the rule. In summation, Independent Reps can be a viable alternative if you find the right rep and if you work with them to foster their growth.
CONCLUSION: In conclusion there are multiple ways to get your doors to market. As a business owner or manager, your time is best spent brokering new deals than it is fussing over a small orders or fussing over the CNC. To grow your business, think of new paths to market and constantly be looking for new angles and cooperations. You might be surprised by what you are capable of with the right sales person or right distributor working to execute your well layed out plans...
ARTICLES ABOUT REPS
FIND REPS ONLINE
No comments:
Post a Comment