Estimated reading time: 5 minutes

It's Only Common Sense: Why Reps Hate Board Shops

Editor's Note: To listen to Dan's weekly column, as you've always done in the past, click here. For the written transcript, keep reading...For the past couple of years, I’ve noticed that it's much more difficult to get independent sales reps interested in selling for board shops. One of my offerings, a task that is becoming my least favorite, is trying to find reps for shops. My fee for this is getting higher every year because it's getting more and more challenging.

Just a few years ago, I could put together an entire national sales force of independent reps for a client in six to eight months. Now I’m lucky to find two reps in that amount of time. Just a few weeks ago, I sent out an offering to over 300 reps for one of my clients, a great board shop, and I did not get a single response.

One of my friends, a national sales manager for one of the country’s leading PCB companies, was discouraged after laboring to find reps and then work with the few reps that he did manage to sign. After he parted ways with the latest disappointing rep, he told me, “The next time I sign a rep it will be one who's been calling me for three months begging to represent my company.”

I once worked with a company that wanted reps so badly they made them an offer they couldn’t refuse: 10% commissions paid upon making the sale, if you can imagine. They had no takers.

Obviously, I've been spending a lot of time thinking about this and I have pretty much come to the conclusion that maybe the rep/PCB shop relationship is a thing of the past. Surely there are exceptions, but, for the most part, I’ll stick to this statement.Here are a few of the reasons why reps hate board shops:

1. Board shops have a history of treating their reps very poorly. They often treat them as a necessary evil, like they are greedy middlemen rather than independent sales professionals.

2. Shops don’t often perform well in terms of quality and delivery causing their reps to spend more time apologizing rather than selling.

3. They don’t pay their reps. For some reason, a rep’s commissions are not treated as seriously as a shop's other payables. This is so prevalent that the shops who do have a successful relationship with their reps do so because they pay on time, all the time. Some of them even pay early to guarantee loyalty which, of course, they get.

4. They don’t communicate well with their reps. Sometimes from the very beginning, they cannot even define to their reps what type of business they want and are then furious when the reps bring them opportunities they cannot build upon.

5. Board shops don’t communicate well at all. Reps are out there selling all day and they depend on their principals to keep them abreast of information about their mutual customers. If the customer places an order, the rep should be told about it. How many times have you heard, “Well, if he really knew what was going on he would know that the customer placed the order.” Nope, not true. The rep probably knows about when the customer is going to place the order, but not exactly when it's placed, so stop snickering about that.

6. Shops don’t communicate well. To do his job right a rep needs the right documentation. She needs copies of the quotes when they go out, copies of the P.O.s when they're placed, regular status reports, and the invoice when the board is shipped. She especially needs to know when a board is going to be late, or if it has a quality problem.

7. I'll say it again; shops don’t communicate well. Your rep needs to be kept in the loop at all times. She needs to be part of contract negotiations during annual buys. He needs to be a part of the meetings when there are issues and problems. A good rep, one who is a true partner, can be a critical asset during these times.

8. In times of trouble, the rep is the first to go. He will be told that the shop can no longer afford to pay his commissions and be profitable.

9. The rep is the last person to get credit when credit is due. This usually happens when he brings in a very big account that continues to grow year after year to the point that after a few years, much of the daily issues are being handled by inside people who start resenting the rep, saying things like, “Why are we paying him? We’re doing all the work.” Always remember: You did not have that account before you hired that rep; she came in and won that account. You would not have the account without the rep. Is that clear? Why is that so hard to understand?

And, finally, the last, but certainly the most important, reason that reps hate board shops is because the board shops screw the rep when they become too successful! I have heard this story over and over again. The rep finds a huge account and great opportunity for both him and the principal. It's worth millions of dollars to the principal and hundreds of thousands of dollars to the rep. This is going to be a big win for all. And then the rep gets canned because the company just cannot justify paying him or anyone that amount of money. “It makes no sense,” the company president says. “You could make more than I make, for crying out loud!” And so the rep is out. All his hopes and dreams are shattered. Oh, he can sue them, of course, but we all know that this is a long, drawn-out, expensive process, and a gamble he can ill afford to make.

So, he walks away. He gets nothing but a bad taste in his mouth for board shops. And the company? Well the company lets the dust settle and then goes out to find a good rep all the while complaining that it’s almost impossible to find one.

Look, it’s very simple: Treat your reps like partners, communicate with them, and pay them and you will have a great relationship. Treat them the way you treated them in the past and you will get what you’ve always gotten, which is what you deserve. It’s only common sense.