Manufacturer Planning … with Reps

NAED meetings, NEMRA planning, AD and IMARK meetings are coming and now being scheduled. It means it’s time for the 2024 planning process between manufacturers and their representatives to begin!

But before the meetings and joint planning, manufacturers develop their plan. The question is “are they getting the ‘right’ field intelligence to develop a winning plan?

Dale Carnegie stated: “Reaction breeds doubt and fear.  Action breeds confidence and courage.” 

The process begins now. Manufacturers are developing their sales budgets, frequently in a vacuum and seemingly believe that every market will perform equally and has the same opportunities. Nowadays many reps feel that factories are in an “ivory tower” during their planning phase. Few are reaching out to reps, early in the planning process, to solicit market input.

.  A relatively simple process that has gotten more difficult because, in the past, reps would meet at the factory, or their people in rep’s offices, to review the year, discuss the market and jointly develop plans.  It was an opportunity for reps to see factory changes and meet, or reconnect, with the people they would be working with to assure the plan came to fruition or at least as close as possible. Relationships were built, which was how a factory became an “emotional favorite”.  Today schedules, costs, and the added responsibilities of everyone seem to have limited those visits and the sharing of information that I have always felt imperative for the planning process.

As a manufacturer’s representative for nearly 50 years, I, as all reps, have had the opportunity to work with various manufacturers and would like to share the obvious, those manufacturers that asked us for information, were genuine in wanting feedback, and enabled us to share information have been more successful in our territory. They had empathy. And then, when their company’s plan was revealed, it allowed a better possibility to properly develop joint plans that were synergistic with theirs, we had greater success together.

Although there is no substitute that measures up with visits and being face-to-face, I find that utilizing virtual meetings enables all of our key associates that are involved with a factory, and key individuals from the factory, together is certainly the best alternative. And the key individuals from the factory is not only sales management.

How many manufacturers have planning meetings now with their individual rep organizations to discuss their specific territories, needs, changes and thoughts for the next year?  A representative is in need of knowing the macro-economic sense of what the factory sees for their products, their production issues, their emphasis and strategies for the next year before they might be expected to plan the micro for their territory/territories.

Planning should be a process. It should require:

• Solicitation of market insights
• Manufacturer develops their plan
• Manufacturer shares their plan
• Rep develops their plan
• Jointly they then develop a territory plan, once both parties understand their company’s goals and resources.

Yes, it takes time, but if mutual success in that territory is important, then time should be found. And yes, as a rep, I had to prioritize which lines received the entire agency’s input, but every line received my time … as that is / was the role of the agency principal, in my opinion.

Planning to Support Manufacturer National Chain Initiatives

Given the accelerated growth of national chains, in many cases powered by acquisitions, as well as manufacturers investing significantly to pursue business with these companies, I continue to be surprised at how little information is communicated to the field given the strong efforts made at these accounts.

Here’s two topics that rarely get discussed:

• A discussion on strategic national distributor accounts since international and national accounts continue to expand their footprint with continued acquisitions likely.
• Efforts made at end-user / contractor national accounts

.A few years ago I had a manufacturer that not only communicated with us their national account strategies, goals and specific initiatives but we developed a joint plan to support them in our territory. We received monthly updates on successful national accounts and successes on the products at various locations throughout the country so that we could mirror those successes at ours.  Knowing this information and the efforts that would be included certainly can help direct representatives and supporting distributors to capture share and allow simple introductions with examples at those accounts.

Additional Insights Needed for Effective Planning

Does the manufacturer expect supply chain issues on specific product components?  A manufacturer once told us that they preferred to not relate to us or to their distributors, possible shortages they anticipated as they felt it would start a run on the product and deepen their backlog.  Understood, however, doesn’t the truly loyal distributor deserve that type of information?  This type of information is again critical in the planning process and, having worked for a manufacturer directly prior to becoming a representative, many shortages are often anticipated and understood by the manufacturer well in advance of their outages. Not communicating creates an opportunity to disappoint customers and cost a rep commission income.

What new products might be coming and what segment of the industry will we need to be directing those efforts?

Does the manufacturer see economic changes in various markets where additional emphasis should be directed?

If so, is there identification of the products needed in those segments available?  Will training be available on the products and the industry segment to be directed?

Are there promotions for the year that will be available, and a schedule to follow that could be shared with representatives and supporting distributors. If so, we could then put together a plan to attack the segment of customers that might utilize those products.

Likewise, the representative needs to relate changes in their focus or personnel changes.  It is imperative to report changes to the manufacturers represented that might either allow cooperation or induce conflict.  It surprised me how many kept their new employees from their suppliers.  The representative risks losing the confidence of the manufacturer essential in any relationship.

“Your task is not to foresee the future, but to enable it.”  Antoine de Saint-Exupery

There may be no better time to prepare positive strategies and relationships than in the planning process!  Understanding each other’s needs, expectations and sharing insights develops better communication and alliances.

A few “fun” examples that I experienced while planning with manufacturers.

• A manufacturer told us to develop our budget, assuring a 12% increase in business during the last recession period without any meeting or communication effort. Every representative in the country had to make their numbers fit.  Unsurprisingly, I was told that not a single rep met their number.   There was no further communication until early September when we received an angry memo stating that their inventory was extraordinarily high as production merely used our figures to determine their production schedule.  The VP of Sales and various regional managers were subsequently dismissed or quit soon after. The morale – there was no buy-in and “peanut buttering” goals across the country does not work.
• Another manufacturer’s VP of Sales had us forecast using our thoughts and other information. I forecasted a 7% increase and supported it with various data. I had backup information and justified the input via discussions with stocking distributors, contractors, larger OEMs and a few engineers. After submitting the information, he thanked me and asked me to resubmit the figures to show a 9% increase, which is what his boss, wanted / expected.  When I asked why he didn’t tell me this previously prior to my initial forecast, he said he kept the originals to present should the numbers demanded not be met for the protection of us all! And in my mind I’m thinking “the games people play.”

Sharing our thoughts enables us to control our efforts and be more successful.  Isn’t that what we all hope?  If so, lets continue opening up communication and make this year’s planning and forecasting a worthwhile endeavor rather than one that is merely an effort in futility.

“Not failure, but low aim is the crime.  In great attempts it is glorious even to fail.”   Bruce Lee

Consider allowing Channel Marketing Group to help in your planning processes.

And if you are in the Philadelphia Metro area and are interested in early 2024 insights, join David Gordon, President of Channel Marketing Group, and Christian Sokoll, President of DISC Corp for their 2024 Economic Outlook presentation to the Electrical Association of Philadelphia on Thursday, September 14 at 12:00. It’s free for EAP members, $25 for others. Register here.