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You have just entered the market with a great new product to offer. But how do you get it into the hands of the people who want and need it? That all depends on the kind of sales entity you intend to use. In essence, you have three choices: hire an in-house sales staff, work with an independent manufacturers’ sales representative firm, or use an independent distributor.
In-house sales staff work as employees. A manufacturers’ representative is an independent entity who will sell your wares but does not warehouse or inventory those products. A distributor is an independent firm that actually buys the product from you, warehouses it, and then sells that product to an outlet that sells it to the end user.
You will have to do some homework to identify distributors or sales reps that sell products to stores that can successfully carry your goods. For example, if you are manufacturing disposable medical products, you want to identify distributors or sales reps who sell to outlets familiar with those kinds of products, says Bill Radin, author, consultant, and president of Radin Associates and Radin.com.
One way to identify distributors or sales reps is through Internet companies that match sales reps or distributors with manufacturers. Three such firms are RepLocate.com; RepHunter.net; and Manufacturers Representative Profile, or mrpusa.com. RepLocate allows a manufacturer to advertise its need for a sales rep or distributor. RepHunter.net actually recruits commission-only reps and has more than 7,000 profiles of independent reps on file. Manufacturers pay a small subscription fee ranging from $89 a month to $149 a month for the right to use RepHunter’s database.
Roger Wilson of mrpusa.com notes that the firm has helped more than 3,200 companies find sales reps who work on commissions ranging from 5% to 10%, sometimes as high as 20% in giftware. Wilson says there are more than 215 types of accounts or classes of trade that a rep can call on. These accounts include drugstores, card shops, airport gift shops, and garden centers.
“The average rep calls on about eight to 12 classes of trade efficiently,” he explains. “If you have a line of desk accessories, for example, we go out and identify the target market you need to cover and find reps that specialize in that target market.” In addition, MRP provides an audio CD with five and three quarter hours of consulting information on how to work with representatives and how to market your product among other subjects.
Of course, you can search for a sales rep or distributor yourself, but be prepared for a lot of legwork. The first step, according to Radin, is to contact manufacturers of the same type or similar product that you offer. Find out who they use. Make a short list and contact the firms on it. Also, find out what stores would be appropriate for carrying your product. Visit or talk to store managers or owners and find out who their distributors are and add them to your list.
When checking references, find out about