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Starting an Agency Archive Manufacturers Representative

The Manufacturers’ Agent

The Manufacturers’ Agent

Personal Qualifications

Sincerity, dependability, honesty and resourcefulness are essential traits for anyone entering the field of the manufacturers’ agent. Other desirable qualifications are initiative, imagination, moderate aggressiveness, enthusiasm and the ability to work without direct supervision. Agents must be able to deal with all types of people, be extremely well-groomed and have excellent oral and written communication skills.

Working Conditions

Manufacturers’ agents will work under varying conditions depending upon the products they sell. Since they are independent businesspeople, they work without supervision and are directly responsible for planning their own time. Besides making sales calls, it will be necessary for them to schedule appointments, make numerous phone calls, and do a variety of paperwork. The size of an agent’s territory may range from small to extremely large. However, all agents must do a considerable amount of traveling by automobile or airplane and may spend varying lengths of time away from home. Some agents are responsible for displaying their product lines at national and regional trade shows, as well as traveling to make sales calls on customers.

Education and Training

High school students considering a career as a manufacturers’ agent should choose courses in sales, marketing, merchandising, business and math. Those interested in selling technical products should take as many related courses as possible (e.g., chemical sales — chemistry, physics, math; industrial products — machine shop, math, physics, etc.). Although many manufacturers select only sales agents who have a college degree, especially those who produce a highly technical product, opportunities do exist for persons with little or no college background. Experience in some form of retail selling, such as department stores or door-to-door, may help qualify a person aspiring to become a manufacturers’ agent. Those planning to earn a college degree should major in either a specific technical field, if that is their interest, or in business administration for those who plan to sell non-technical products.

Earnings

Since a manufacturers’ agent is paid on a commission basis, earnings will depend on a number of factors. The type of products sold, the number of manufacturers represented, the commission structure, and the individual’s own sales ability all have an effect on the agent’s income. Therefore it is difficult to calculate an average wage. A beginner may make between $15,000 and $17,000 per year, with the average for a more experienced agent being closer to $52,000. An agency owner, who has a number of independent agents working with him, may earn as much as $200,000 net (after expenses) or more. Unlike the direct salesperson, a manufacturers’ agent is an independent businessperson and is not reimbursed for such things as transportation costs, hotels, phone calls, meals, car rentals or secretarial services. Agents are also responsible for their own medical insurance, retirement plan, and for paying their own income and social security taxes.

Employment Outlook

There are over 30,000 manufacturers’ agencies in the U.S. today. The number will undoubtedly increase during the next 10 years. The factors that contribute to growth include a rise in population, a rise in the standard of living, better distribution techniques, a wider variety of products and an increase in the technical skills needed to pioneer new products. New positions are created when there is a growth in these areas. Openings also become available due to attrition as well as expansion. More and more manufacturers are making the switch from direct salaried sales forces to manufacturers’ agents because it lowers their fixed cost, since they pay agents only on the basis of goods sold.

This concludes our “back-to-the-basics” look at the life of the professional outsourced field salesperson. Next month, we will examine business planning for manufacturers’ agents.