Synergy Gains an IDEAL Partner

Sometimes it takes time for there to be synergy between a rep and a manufacturer. And yes, we’re using a play on words as Synergy Electrical Sales announced that it has become the manufacturer representative for IDEAL Electrical in the eastern Pennsylvania and southern New Jersey markets.

Synergy Partners with IDEAL

According to a press release from Synergy, “Synergy Electrical Sales is proud to be selected to represent IDEAL Electrical in eastern Pennsylvania and southern New Jersey. This agreement comes after months of careful discussion and assurance from Synergy that IDEAL found a unique partner on whom they could rely.

Synergy’s team-based sales approach helped make this partnership a reality, as it set them apart from other agents in the marketplace and positioned them as a strategic partner for IDEAL.”

For those unfamiliar with Synergy, “they operate on a service-based model across each of their three sales divisions. The company’s electrical wholesale line card includes brands such as Encore Wire, Panduit, Signify, and Lutron. Their team of experts, as well as their breadth and quality of manufacturers has grown significantly in the past year. (Their other sales divisions are in the lighting space and the company operates in Delaware, northern New Jersey and the southern NY / Long Island market.)

Synergy has its roots in five family-owned independent manufacturers’ reps — Jacobson-Rodger Associates, Low Associates, McDevitt Electrical Sales and most recently, the Ertel Company and Pyramid Lighting Group.”

According to sources, Synergy, a long time Cree Lighting representative, made its interest known to IDEAL a number of years ago and, with IDEAL’s acquisition of Cree, became better acquainted with a number of levels of management within IDEAL. The company was patient but maintained contact, especially given that IDEAL went to market via a direct salesforce in the territory. With COVID and generational change creating “change”, an opportunity developed, and interests aligned.

Feedback from others in the market was that no one seemed to know that IDEAL was looking for an agent and presumed IDEAL would retain a direct sales organization.

The moral … if an agency has interest in developing a relationship with a supplier, it needs to identify ways to subtly market itself / obtain visibility and sometimes it “takes time.” Hoping a line reaches out isn’t always a good strategy. Reviewing “your” linecard to identify gaps can create opportunities. Being appropriately proactive and having vision is what drives progressive agencies.

Speaking of “progressive”, Synergy was active over the past year. Rather than “hunker down” during COVID (and yes, they had some personnel “change”), they invested in selected roles, made an acquisition, acquiring Pyramid Lighting Group, thereby increasing their presence in NYC, changed a number of lighting lines and also now represent Panduit and Signify Lamps & Ballast (Philips Lighting).

Congratulations to Synergy.

The Flip Side

And then there is a “flip side” to consider. While we don’t know how many direct salespeople IDEAL had in the market, presumably it was not many (as typically only distribution equipment manufacturers have “many” in a local market.) With an aging work force and natural employee “churn”, let alone the challenge of recruiting talent and training them, manufacturers with small direct salesforces in a territory can be at a competitive disadvantage, especially in today’s employment environment. Turnover is also costly (not only due to recruitment and training costs as well as lost productivity) but also because of the loss of local contractor / end-user and distributor relationships. Agencies, on the other hand, while they may go through personnel change, for the most part they are a constant in a marketplace, already know the players and represent a “known variable cost” in a market.

Synergy presumably was the beneficiary when they earned the Panduit line (as Panduit used to have a direct salesforce.) There are times / locales where Philips went direct. IDEAL fit the same profile. What other manufacturers have “small” direct salesforces that may be considering, or be forced to, change?

It reminds me of a comment from a manufacturer from when we conducted the NEMRA Rep of the Future report where he essentially said “having a rep enables me to outsource HR issues and retain a presence in a market, especially if I only have 1-2 people in a market. With only a few people, I have the territory open when they are on vacation or sick. If there is turnover, I lose productivity for 18 months (hiring, training, relationship building time) and, with a rep, I don’t have to deal with HR administrative issues, just performance reviews and planning.” Essentially, he was saying that a rep network gave him cost-effective coverage and made him more effective / productive.

So, a couple of questions …

• Distributors – recognize the coverage and relationship challenges, in today’s world, which would you prefer – a rep firm calling / supporting you or a direct salesforce that has 1-3 people in your market (defined as a minimum of a state / geographic area) who is responsible for multiple distributors and end-users?
• Manufacturers – What is the minimum dollar amount you need in a territory to justify 2-3 direct salespeople and associated customer support cost allocation and is this more / less cost effective than having a rep agency?