Electrical Rep on Industrial Plant Floor

Years ago, I was on a Manufacturer Rep Advisory Board when the President of this conglomerate proudly boasted that their products could now be as much as 11% of a distributor’s total purchases. and even greater, at selected industrial facilities and he thought similarly at contractors (after all, a product is a product, and he felt they could replace ANY competitor.) He announced that no one could match this in the electrical industry. I politely raised my hand at the meeting and disagreed, stating his reps could!

While he disagreed initially, I commented that it required “selling” and promoting the product’s value proposition. Further, if the channel (distributors and reps) are not aligned, then achieving success at the customer and getting them to be brand loyal could not be attained.

Fortunately for me, he laughed and agreed.

Maybe I should have asked how many of their distributors were currently carrying all that they represented and if it was, at least, 11% of the distributor’s sales? But I did want to keep the line!

The Role of the Rep

We continue to hear from manufacturers and distributors the positive effect representatives have in supporting distribution as well as their role in supporting the construction markets by offering leverage of products, market knowledge, and relationships, but often do not cite examples in the industrials.

The big reason … the selling dynamics differ.

In the contractor environment, there can be greater acceptance, by  the contractor, to substitute what THEY believe is like for like. In the industrial environment this is frequently not feasible as products are specified and customers may seek standardization for various reasons. Further, the influencers and decision makers (think engineering vs purchasing; maintenance vs engineering and purchasing) in industrial accounts have differing criteria, and it can change by facility (geography)  within the same company.

I spoke with various reps about their industrial manufacturer relationships and sought examples where, beyond specifications, their relationships and market knowledge enabled them to successfully write business by promoting value added services of the manufacturer, or themselves ( yes, distributors have value-added services but they need to promote theirs to the customer / prospect to win the business and differentiate themselves.)

5 Examples of Reps Driving Industrial Demand

Here’s five examples of reps having success in the industrial market.

1. While dated, an example was with my company over 25 years ago. We successfully got a product specified at a very large chemical company. The issue became the company needed to work at nights and weekends on the project and space was a major concern at the six locations where the product was needed. We were able to negotiate with the trucking company that we did much of our shipping for eight non-road ready trailers at $50 per month to be placed at the locations. Two of the distributor’s VPs high school aged sons took inventory weekly, at the trailers, and charged for product used earning us a million dollar plus order! Nowadays many distributors offer storeroom management, VMI, or job-site trailers but … if you do not tell all of the appropriate constituents at a customer, how do they know? Sales and marketing need to collaborate on identifying and marketing this opportunity … and showing the value.
2. A rep in the South told me he had an automotive manufacturer he was trying to sell to, in support of a distributor who was doing business with the auto manufacturer. He was confronted by a manufacturer who was selling them directly utilizing the manufacturer’s part numbers. Sizing the opportunity, the rep quoted the project by combining multiple products (essentially doing a pre-fab process) and began making the finished product by building the parts in-house with two of his manufacturer’s parts.
3. One of my favorites, a Midwest rep principal who sold specialized utility backup batteries grew weary of nighttime and weekend calls for batteries that had failed. He developed an inspection team that would, each month, test the utility’s batteries and automatically replace those batteries that failed. Not only was he able to sell the replacement batteries but he also contracted with the utility to provide the inspection service and was able to charge the utility for this new service. The end result, they became embedded into the utility’s maintenance process, generated a new revenue stream (and service they could sell to others), developed a method to ensure battery re-orders, and generated a healthier margin than he received for selling the batteries!
4. A Southern rep got a product specified at a truck manufacturer. He unfortunately lost the business when, after three years of success, the manufacturer developed a cost-cutting committee. The committee solicited bids and decided to award the business to a manufacturer sold a similar product directly. When visiting the plant months later, he found the new supplier failed miserably at delivery.  With a plant engineer, he met with the committee and showed them how the unfinished trucks were costing them far more than the savings of purchasing one product directly. He regained the business and also committed to having backup inventory at both their preferred distributor and his warehouse. A win for all.
5. An OEM in the Midwest was purchasing a high temperature device through a distributor and manufacturer who could not keep up with their demand. The rep grew tired of asking his distributor for more information on usage and receiving no return calls. He also had an upset manufacturer who was constantly being pressured to improve service or lose the business. The rep visited with the planner at the OEM and explained that it took two months for the manufacturer to receive parts from their supplier, and he did not want to jeopardize their business. They worked out quarterly orders well in advance with the only stipulation by the buyer that they wanted no relationship with the specific distributor involved. The buyer claimed every time they called the distributor the only information they received was chastising the manufacturer. The business at distributor cost was over $400,000 at 22% gross margin and was totally direct shipped. The rep asked the OEM to identify whom they preferred to do business with, and the business was moved.

Take Aways

To those who might question a rep’s industrial position, or capabilities, please understand that our findings conclude buyers at industrials, like elsewhere, have smaller staffs, are working more hours and prefer fewer contacts who are able to communicate and service them. They do not have time to see every wanting salesperson nor place multiple orders and help explain the success of many broader distribution companies.  And reps, this is why Product Expertise is a core pillar of the Rep of the Future and why the 2025 Rep of the Future report calls out the need for investing in training … both sales, demand generation, and product. Leading companies will have defined training processes, and expectations, of their staffs (and regional / national firms will differentiate themselves by having dedicated trainers to either provide or coordinate training.)

Manufacturers, the issue, at times, is education and product knowledge. Perhaps training your reps as you might your direct salespeople makes sense. And while some learn quickly, others take time, especially if they do not have a short-term opportunity … or consider new hires. Consider that before a customer, your rep is your direct contact to them. The more anyone is comfortable with product the more he will emphasize and sell. This is also why Product Expertise is a core pillar of the Rep of the Future. The impetus is on the manufacturer, and perhaps more accurately, the regional manager, to identify training opportunities at the agency and individual level. (The 2025 Manufacturer of the Future, which highlights manufacturer expectations of reps, is available for free to all NEMRA members (reps and manufacturers.)

If you want to grow your industrial business, it is all about sales skills (asking questions, seeking information, understanding core business issues) and demand generation (sales, marketing, training.) Simply servicing is not enough anymore.

Need help in better positioning and marketing your rep firm to capitalize on these trends, give us a call.