Downstream selling is regarded as one of the most important functions of an independent rep.

Jeff New, Mid-City Supply and ASA: "The best reps have a purpose in being there."

AIM/R is an organization representing many of our industry’s independent rep agencies. For years a spirited debate has taken place within the group as to whether to allow manufacturers into the group, and that was finally resolved last year with an associate manufacturer membership category. This year’s annual AIM/R Management Conference, held May 14-17 in Palm Coast, FL, was the first in which manufacturers were invited to attend, along with selected wholesalers. It led to some frank, though civil, discourse on a range of industry hot button issues.

The highlight of the conference was a panel discussion with the hot seats occupied by manufacturers and wholesalers who participate in buying groups. Panelists included wholesalers Jeff New, president of Mid-City Supply, Elkhart, IN, and ASA; Fort Worth, TX-based Morrison Supply President Darrell Hawkins; and Randy Boyd, president of  A/C Supply, Fort Worth, TX, and HARDI. Manufacturers speaking up were Bruce Carnevale of Bradford White, NOMACO’s Scott Edwards and Kendrick Reaves of Cash Acme.

Despite the buying group focal point, the only discussion about buying groups concerned some reps complaining about being unfairly “bashed” at those meetings without opportunity to respond. Panelists generally agreed with Carnevale’s assessment that “rep bashing is a myth” at buying group meetings. “Most of the time the evaluations are done in a productive way,” he said. “We (manufacturers) get evaluated as well.”

Edwards added that “95% of the time you guys get rave reviews.”

Darrell Hawkins, Morrison Supply: "Reps are putting forth tremendous effort (in a down year)."

A question was put to the panel to identify the most important things reps can do for them. Training was included in everyone’s response and came in for more detailed discussion than any other topic. Read my “In Closing” column on page 143 for a summary. Other topics of note included:

  • Downstream selling - The manufacturers on the panel identified one of the most important functions of an independent rep as creating demand for their products by calling on contractors, engineers and other downstream customers. Wholesalers were not opposed, although all those on the panel expressed the wish to be kept informed by the reps who call on secondary customers. Hawkins pointed out that “sometimes we can’t sell to a contractor because he doesn’t pay his bills, so communicate with us before or after.”

  • Strengths of the independent rep s - “You’re the constant,” said Reaves. “You will be in the territory after the regional sales manager has moved on. We need that continuity.” Echoed Carnevale: “Local knowledge is your greatest strength.” New noted that “the best reps have a purpose in being there. They don’t just come in and say, ‘What can I sell you today?’ Don’t waste my time.”

  • Rep weaknesses  - Morrison Supply’s Hawkins was persistent in his criticism of reps whose warehouses tend to shore up weak competitors or even compete directly against wholesalers. “Don’t make your DC a will call facility,” he said. “Some of the markets where we do best are where there are no stocking reps that enable small wholesalers to survive without investing in inventory. Make wholesalers be wholesalers.” NOMACO’s Edwards observed that “the ability to plan is the difference between strong and weak reps. Hope is not a strategy.” Bradford White’s Carnevale chimed in: “It’s frustrating when a wholesaler tells us, ‘We didn’t know you have that product.’” Boyd said, “The best reps are information providers. The weak guy is the one who wants to play golf and be my friend.”

  • Selective distribution  - New and Hawkins spent a little time pleading for more selective distribution policies, although manufacturer Edwards came to the defense of reps, noting, “Reps are caught in the middle. Wholesalers want selective distribution, while manufacturers want bigger market share.” He asked reps to cooperate in mutual interest to preserve the channel. He spoke of a situation that caused his company to switch a toilet line due to a big incentive program to builders, leaving his company stuck with a huge inventory. “Now we have to force-feed that product. Understand that we need to get a return on our inventory investment,” Hawkins said. “Intercede for us.”

    In concluding the session, a question was posed to the panelists: “What have reps done lately that has ‘wowed’ you?” It generated some interesting responses.

    New spoke of one rep enthusiastically participating in a Habitat home build with his team, and another who managed to get him a line he didn’t normally carry for a commercial bid job in which the builder wouldn’t accept his company’s line. “That’s becoming part of our organization and helping us sell,” he noted.

    Carnevale spoke of being impressed by the pre-planning of one rep with whom he traveled. “It was a detailed summary of who we were to visit, what the issues were and so on.” He added, “Plus, I’ve been wowed by some training centers reps have built.”

    Hawkins said he was most impressed with “how hard everyone is working. It had been a pretty easy market, but now things have changed and I see more feet in the marketplace. Reps are putting forth tremendous effort with our salespeople and our customers.”

    Reaves said he was cheered by “the lack of negativity with reps. I’m not getting e-mails complaining about housing starts. They’re out there trying to make things happen.”

  • Bruce Carnevale of Bradford White also spoke at the conference.

    Reps' concerns

    A highlight of all AIM/R conferences is the traditional “Townhall” meeting in which reps share their ups and downs with one another. One hot topic at this year’s conference was the price of gas. It was bumping up against $4 a gallon at the time of the meeting, which may seem like the good old days by the time this gets printed. Several AIM/R members advised they were opting for smaller cars.

    One rep warned of the encroachment of third-party logistics companies being hired by builders to avoid the distributor channel. It’s a minor concern now with home building slumping so badly, but a system is already in place for items such as siding, doors and windows, and some builders want to extend the 3PL solution to plumbing as well.

    Call reports were a source of some griping by reps. “When times are good, we send orders. When times are bad, we send reports,” quipped one.

    AIM/R Executive Director Bryan Shirley cautioned his members about potential legal consequences of call reporting. “You cannot submit all reports manufacturers may want, because it could indicate you are an employee,” said Shirley. “It has to be useful information requested, not just contact info.”

    Another noteworthy occurrence at this year’s conference was the first-ever programming by a recently formed “Leaders of Tomorrow” (LOT) group. About 30 agency heirs belong to the organization, which is spearheaded by Michelle Lewnes (Preferred Sales, Hermitage, PA) and Mark Creyer (L & R Associates, Hatfield, PA). The group sponsored a couple of breakfast programs on techniques for calling on builders, builder and contractor showrooms, and another on “Optimal Thinking.”