Shifting Sand

March 24, 2015  by in Furniture Retailing, Industry   

By: Janice Summers

Look back through time in the home furnishings industry, and you’ll see that in the 1980s the manufacturers sales representative was a force to be reckoned with.

Manufacturers knew it the secret sauce in hiring the best of the best when it came to sales representatives, and chose their reps like football franchises choose key players. They were superstars.

That began to change a few years ago. Sales territories got bigger, and sales teams shrank. Some companies, like Thomasville in 2007, even eliminated their sales forces altogether.

“Whether they will stay or go has been controversial for years,” said Randy Spak, vice president of sales for American Furniture Manufacturing. “At one point it looked like they’d be going away. We choose to have reps on all our accounts. The relationships they have are very valuable in our eyes. In many cases they are a tiebreaker when companies are competing. I even heard of one case where sales volume dropped by half when a certain rep stopped handling the account. That’s a big risk for a company.”

The role of a sales representative has never been easy, and in today’s climate of vertical retailing, offshore manufacturing and retail consolidation, the job has gotten more challenging. Being the liaison between vendor and retailer can put even the best of salespersons in a precarious position.

Today’s retailing environment requires sales representatives to wear a number of hats—marketing consultant, trainer, inventory control manager, customer service agent and more.

Matt Keepers has been an independent sales representative for 13 years and has seen the role evolve during that time.

“We are constantly finding ways to reinvent ourselves,” he said. “In the beginning, a rep’s sole purpose was to sell merchandise. It was still like that when I started.”

Today, most manufacturers have computerized systems requiring sales representatives to update them with accurate information. The systems offer real-time projections on what products are selling.

“It’s time-consuming,” said Keepers, who is the current president of the International Home Furnishings Representatives Association (IHFRA). “We have to analyze our business by product. Many manufacturers have 2,500 or more products. Having up-to-the minute information is crucial, because domestic manufacturers might have inventory that’s 30 to 60 days out, but importers can have a 4-to-6-month lead time. Sales reps will have a purpose as long as we have value, and providing information to the retailer is a huge part of that value.”

Number crunching aside, Keepers recognizes the most important place to be is in front of the customer.

“I work with my customers face to face during the day and do my computer work in the evening,” he said.

Keepers feels that independent representatives still build crucial relationships between manufacturers and retailers¾offering product training, advising about things that are not working, and answering specific questions that aren’t apparent either in the catalog or by looking at the product.

“The distribution network hasn’t changed all that much,” said Keepers. “Some major customers tried to go direct to overseas suppliers but found it’s difficult. There’s no sales force, no cataloging, no parts. It’s a big challenge to source straight from China. Most international companies don’t have warehouse space here, so they sell by the full container. The largest retailers might be able to handle it, but it’s hard for most retailers to take 100 of anything. That, and other manufacturing constraints overseas restrict retailers from going direct.”

Historically, most representatives are independent and may represent several companies. Companies may have as few as three reps or as many as a hundred for the larger companies. Sometimes they are salaried and sometimes commissioned.

There might be fewer of them, working longer hours and bigger territories in a role that has shifted, but IHFRA has more than 2,000 members in the U.S. and Canada.

“We must look out for our manufacturers and customers, not ourselves,” Keepers said. “If we take care of them, we’ll be fine.”