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Most distributors have already eliminated the under-performers within their organizations and slashed truly non-essential costs in reaction to today’s economy.  Now reductions to the sales force carry with them the legitimate concern that as personnel is eliminated revenues will be as well.  The question many distributors are asking is, “How can I reduce costs without losing sales?”  For many distributors it is challenging to even understand how to look at the risks.

Excerpt: If the local factory or supplier rep is more effective in the job, the distributor will sell more of the rep's product.  Effectively managing the relationship is the quickest way to improving distributor productivity.  The keys to understanding and improving effectiveness are: understanding the distribution business; recognizing that distributors and manufacturers often work at legitimate cross purposes; and being sensitive to those irritating "MBAs" that can make or break a relationship.

Excerpt:  Our work with hundreds of distributors has reinforced this message over and over.  Sales management is the real competitive differentiator.  Why?  Because strong sales management provides leverage.  Investing in a sales rep gets results from one territory.  Investing in a sales manager offers the potential for improvements in all the territories that report up through him.

Here’s a question for you: Suppose you have one sales rep who sold $2 million worth of product last year and another who sold $1 million last year at the same profit margin. Who should have been paid more? If you said the one that sold $2 million, you are in the majority and may benefit by reading the rest of this article.