It's been a wild ride for independent manufacturers' reps the last few years. A crippling decline of historic proportions in the all-important nonresidential construction market forced them to find other sales opportunities. Tablet computers and cloud computing now give them access to critical sales information when they are out in the field. New manufacturers in the lighting and energy markets are after them to rep their lines.
Throw in evergreen industry challenges like finding more selling time to market new products, distributor mergers and succession planning and you can see why it's been an interesting few years for the independent manufacturers' reps that an estimated 80 percent of electrical manufacturers use in whole or in part to sell their electrical products. This era of change has coincided with Ken Hooper's first three years as president of the National Electrical Manufacturers Representatives Association (NEMRA), Portsmouth, N.H., after he took over for Hank Bergson, who retired from the post after serving the organization for 22 years. It's presented some interesting new challenges for Hooper and his new team in Portsmouth, as well as Jim Bannon, NEMRA's director of information technologies, and his IRIS IT team in Chappaqua, N.Y.
Hooper had worked with independent manufacturers' reps for more than 30 years in executive posts for Ferraz Shawmut, Legrand and GE, so there haven't been too many surprises in how reps operate. But during a recent interview in NEMRA's offices in downtown Portsmouth, a postcard-pretty New England city on the New Hampshire coast, Hooper said he's been pleasantly surprised with how willing reps and manufacturers have been to donate their time to the NEMRA executive board and NEMRA Manufacturers Group (NMG) in this era of doing more with less.
Kirsty Stebbins, NEMRA's manager of marketing and member services, didn't work directly with reps during her five years with Siemens in inside sales support, but that experience helped her appreciate the importance of getting field salespeople timely, accurate and valuable product information for their sales calls.
This is a primary focus of RepFiles, a new mobile-based content management system for electrical product information such as price sheets, marketing collateral, videos and installation guides that NEMRA supports. (See “Point of Contact” on page 19.) With RepFiles, manufacturers can keep this information updated and available for use out on the cloud, and reps and other electrical salespeople can download the information they need to their tablet computers, so they don't need an internet connection while on a sales call — a huge deal when you consider the sometimes tenuous nature of dependable internet connections when you are on a sales call at a construction site or in a factory.
This year's NEMRA conference in San Diego will help reps make sense of this new and more mobile world. Hooper and Stebbins say pre-conference registration for the seminars on RepFiles for NEMRA by John Hoelz, its creator and principal of J.F. Nolan & Associates, New Berlin, Wis., has been phenomenal. To help reps keep in touch with their businesses back home and to access the cloud-based NEMRA strategic planning software in their meetings with manufacturers, NEMRA has invested in broad WiFi coverage at the conference. The association also invited a web-site design company to be part of the conference's showcase of services to help reps redesign their web-sites.
Electrical professionals are starting to see the impact of another major NEMRA project — a new marketing initiative. The association has developed many of its new marketing tools with the help of Eric Mower & Associates (EMA), a Syracuse, N.Y.-based ad agency with tons of experience crafting marketing campaigns in the electrical market. NEMRA and EMA also have retooled the association's marketing efforts and want to drive home the message that the rep is the local connection. “All sales are local and the professional NEMRA rep has the connections to help you make your sales in the local marketplace,” says Stebbins. “They are used to servicing a wide range of customers.”
To drive home this new positioning, NEMRA also has a new website and is ramping up its social media efforts.
Hooper is happy with NEMRA's recent growth — the association added approximately 25 new rep members and 25 new manufacturer members last year, and the staff is constantly fielding calls from manufacturers new to the electrical market who want to learn how they might be able to use NEMRA reps in their outsourced field sales efforts.
“Some are more industrially oriented and don't focus on the electrical channel as we know it,” says Hooper. “Others are start-up companies with a new technology that focuses on energy efficiency. LEDs are big. Some companies are from Europe and have a good position in their home market, and feel they have a good product that can meet the UL standards. People are looking for the outsourced sales professional. That's what NEMRA is all about. We don't want to be the choice because of financial reasons. We want to be the choice because we represent the best possible way to go to market.”
Hooper says some European manufacturers don't have a clear idea of U.S. sales geography in terms of how many reps they will need to cover key sales territories. He says it takes approximately 30 rep agencies to cover the United States, and even more if the manufacturer wants to build a market in Canada as well. Stebbins fields many of the calls from these manufacturers when they want to utilize NEMRA's “Hot Lines” online resource at www.nemra.org, where manufacturers can post available sales territories for their products.
While Hooper and Stebbins are encouraged by the steady flow of new manufacturers who want to integrate NEMRA reps into their sales efforts, they are careful to tell these vendors that there are limits to how many new lines the typical rep can take on, particularly if the product or technology will require extensive missionary sales time. Hooper says taking on a new manufacturer requires that a rep perform a careful analysis of their portfolio of product lines and resources. For manufacturers, it may require developing a commission package that rewards reps for spending additional time to develop demand for new products.
“One of my concerns is a supply-and-demand issue — there is more demand than we have a supply of reps,” he says. “Most reps are going to be very selective in taking on a missionary line. The return on time and investment has to be quite clear and the technology and the distributor and end user buy-in to the technology has to be such that's its worth a shot. Market forces generally work out and everything gets to the proper level. Generally these people find reps. Missionary lines are always going to be out there and reps are always going to take a look at them. But I think they have to be very selective.”
Whether it's new lines or new products launched by their existing manufacturers, Hooper and Stebbins say NEMRA reps are finding more of the marketing falls to them. Hooper says because distributors' product baskets are now so large and because so many new products are being launched, they can't be experts on everything. That's why they want NEMRA reps to create demand for new products and to train users on them, he says.
The growing role new products play in the market was one of the key findings of NEMRA's Rep of the Future study published in 2010, which Hooper, NEMRA's executive committee and the NMG use in their long-term strategic planning for the association. The study also said manufacturers will expect reps to spend more of their selling time calling on end users. “Getting new products seeded in the market will be a bigger part of the job of the rep,” says Hooper. “RepFiles will be a great tool in that regard. The ability to make a sales presentation and not have to rely on an internet connection when you are deep in the bowels of a building or in a contractor's trailer will be a big help.”
NEMRA will continue to develop tools to help reps with these responsibilities. Its MRPAR (Manufacturers' Representative Performance Analysis Report) program, which has been available since last year, helps reps improve the profitability of their businesses. And to help members analyze their sales resources and selling time, the association has introduced TeleNotes, a phone-based sales reporting system developed by a rep in another industry. Reps simply call in their sales reports to TeleNotes after making a call, and TeleNotes transcribers take that information and record it into sales reports. While some manufacturers require reps to use call reporting systems like salesforce.com, Hooper and Stebbins say TeleNotes works for NEMRA members who need a simple solution. “Being able to report info back to the manufacturer is a challenge,” says Hooper. “Reps are being asked for more and more information as manufacturers expand their product lines and get into vertical markets. There is such a thirst for information.”
NEMRA will also be launching regional sales training for members through Heyden Sales Training that will cover solution-based selling, negotiations and time and territory management. Reps that take the Heyden sales training can get continuing education credits (CEUs) for Certified Sales Professional (CSP) courses offered by the Manufacturers' Representatives Educational Research Foundation (MRERF). NEMRA plans to offer eight regional workshops in 2012 and already has four classes scheduled.
IRIS software, which was developed years ago specifically to help reps run their business more profitably, remains a key NEMRA offering, and Jim Bannon and his team are focused on helping reps manage their data better, streamline commission reports and otherwise helping them become more productive so they can reallocate more of their time to marketing and sales. The cloud-based strategic planning software that NEMRA recently launched will eventually be integrated with IRIS.
Over the next few years, Hooper says NEMRA reps and manufacturers will need to do a better job of telling each other exactly what they expect the other to do in their business relationship. “It doesn't always get put into an agreement, he says. “Manufacturers and reps need to do a better job of spelling that out.”
Despite all of the changes in the electrical market, some market constants really haven't changed much over the years. Says Hooper, “For all the consolidation that goes on, the needs of the market are still there. Buildings still need to be built. The MRO needs of factories are still there. Specifiers still need to be called on. The distributors involved may change or the decision making may move around. But the rep is still there because he had dedicated himself to that local marketplace, meeting the needs of the local market. Those local relationships are still the critical link in how things happen and how products get to the marketplace.”