To say that rep-firm Bell & McCoy Inc. has its collective eyes fixed on the future is an understatement. The agency has taken pains to ensure a secure future via its efforts in diversifying business and strategic planning.
Headquartered in Dallas, the 29-year old, 80-employee agency serves primarily electrical distributors. To ensure thorough coverage throughout its wide geographic area, which includes Texas locations in Houston, San Antonio, Abilene, Austin and Henderson; Oklahoma locations in Oklahoma City and Tulsa; and a branch in Little Rock, Ark., Bell & McCoy begins its annual strategic planning in late November or early December.
“We'll bring in all of our salespeople and charge them with putting together a sales plan for the coming year,” said W.E. “Buddy” Binyon, one of Bell & McCoy's principals. “They execute their plan by working with each manufacturer and each account to determine how they will grow that business in the coming months. After this initial plan, we'll meet again at midyear to review the status of their plans. We also monitor their plans on a monthly basis to keep an eye on how well they are meeting their expectations.”
Binyon prefers Bell & McCoy's salespeople be overly ambitious when it comes to strategic planning. “I'd much rather have them think positively than negatively. By being overzealous, they'll work harder to reach their goals than if they under planned.”
Although the rep firm's focus is on the electrical industry, Bell & McCoy is making inroads in the lighting business and plans to look to plumbing and other areas in the future. “We're always looking at additional markets — areas that will allow us to stand apart from the competition,” Binyon says.
Adding a datacom division has been one of Bell & McCoy's most important growth areas. “We've had the opportunity to put some extremely knowledgeable people in the field,” says Binyon. “At the same time we've been able to explore some opportunities with manufacturers who serve that end of the business.”
In addition, Bell & McCoy has opened up its activities on both the industrial and contractor sides of the business. To meet the needs of those markets, the agency recruits from engineering firms, industrial locations and contracting firms. The agency even has a master electrician on board.
Hardly content with past accomplishments, Binyon says the agency will continue to diversify in the future. “I think that's the only way you can insulate yourself from different economic climates.
“Years ago when we started the business, the rep was simply fulfilling a selling function in the marketplace. The manufacturers contracted with us because we could sell more economically than they could. Our only charge was to go out and sell products. Over the years, things have changed to the point where we provide credit, maintain inventory and provide an inventory management function. Now, even marketing is a large part of what we do for our manufacturers.”
Although these added rep functions make reps more valuable to manufacturers and customers, there are downsides. “Even in the face of all these added services, the compensation the rep earns hasn't changed much over the last 40 years,” says Binyon. “That's the case even in the face of the dramatic increases in the cost of running our businesses. And what happens when we raise this subject with the manufacturer? Their claim is that they can't afford to offer any more compensation than they presently do. But the fact remains if the manufacturer had to provide the services we offer them, they wouldn't be able to or couldn't afford to do it. They recognize exactly what they are capable of doing, and that's why the rep is so valuable.”
The additional services provided also cut into the time reps are out there selling. “Our selling time today has actually been reduced from what it was 10 years ago. That's good and bad.” On the bright side, it forces reps to think more about what they're going to do when they get in front of the customer, says Binyon.
Like other rep firms, Bell & McCoy has not been immune to the impact of a rapidly evolving technology. “All of our people are equipped with mobile phones, pagers, e-mail and fax,” says Jason Binyon, vice president of sales. “All of our information systems and data are centrally located and soon our customers will able to check their own orders online.”
With an eye toward the more distant future and succession planning, Buddy Binyon explains that the agency already has personnel in place to take the reigns. “We're creating an ESOP. Our manufacturers have been informed regarding what our future plans are and who will be leading the organization.”
For Bell & McCoy, future plans appear to be covered quite well.
THE PROBLEM WITH POS BOTH
Buddy and Jason Binyon bemoan the fact that compensation paid to reps hasn't changed much over the past 40 years, but reps are even more vocal about the lack of accurate and timely point-of-sale (POS) reporting.
According to Buddy Binyon, “This is a No. 1 concern for reps today. I hate to sound negative, but every time we raise the subject, it falls upon deaf ears. While some people may be working toward a solution, it's not even close to being fixed yet. I don't know if it's more a manufacturer or a distributor problem — but it's one that must be fixed.”
Quickly adding agreement is Jason Binyon, who points to two main areas of concern. “First, there's the delay in payment of commissions for the rep. This is something that reps all across the country are facing today. In addition, this lack of reporting inhibits our ability to monitor not only our own salespeople but also the distributors that we work with.”
Neither manufacturers nor distributors seem to be overly concerned about this, but they should be, according to Jason Binyon. “The rep is going to line up with the distributor who is regularly compiling and reporting figures to manufacturers,” he said. “It only makes sense that he's going to steer business to where he knows he's going to be promptly compensated.”