May 26, 2022

Four Ways to Improve the Relationship Between Manufacturers and Representatives

The manufacturers' representative business has been around for more than a century, but some sales agencies were formed as late as the turn of the century. In the post-World War II era, new companies needed ways to sell their products to consumers. They favored the manufacturers' representative business because it provided no cost until sales were made. Manufacturers reps are a variable cost, therefore no expensive fixed sales expense is required. In fact over the past 20+ years many industries have moved from a direct sales model to a Manufacturers rep model for the advantages discussed below.

Benefits of utilizing a manufacturer's representative

Employing a manufacturer's representative has numerous benefits for a manufacturer. Reps are compensated by commissions, so their costs are usually lower than those of a salaried sales force. Manufacturers can also spread the costs of hiring a sales force over several products, thereby saving money. Additionally, outsourcing field sales allows factories to operate more efficiently, passing on lower prices to their customers.

A manufacturers' rep's knowledge of the marketplace is invaluable, both for new products and for established products. These professionals can give dealers and end users unbiased reviews of products and services. These professionals are also capable of conducting market research and consulting, and can help companies identify new trends. Lastly, they can quickly identify potential customers for new products and services. While the advantages of utilizing a manufacturer's representative are many, the following are a few of the key benefits:

A successful representative in the Electronic Manufacturing and PCB assembly industries spend a significant amount of time educating the customers on industry related products, services, and information about Printed Circuit Board manufacturing, Surface Mount Technology, Pick and Place Equipment, ElectroStatic Discharge (ESD) products, Robotics, inspection AOI technologies, Workbench assembly equipment and accessories. Representatives in the electronics industry have a wide range of complimentary products that are of value to the end customer. Representatives don’t just sell one product line but are helpful in specifying the best solution for the customers processes. Representatives in the Electronic Manufacturing industry also offer assistance in overcoming production problems, and helping to improve process efficiencies. In addition, because they are in constant contact with customers, it can generate a significant number of new leads, and ensures smooth project transitions and rollouts. A good manufacturer's representative also knows how to build relationships with engineers and end users, which gives them a distinct advantage in sales.

Functions of a Manufacturers’ Representative

Manufacturers representatives are generally very knowledgeable with regard to multiple customers at accounts in their territories. They will know people in a variety of positions at each account and at various levels. Having a wide range of complimentary products and services builds customer relationships at key accounts. Having multiple products enables reps to get deeper into accounts that direct factory sales people that only offer one product line can not typically take advantage of.

Representatives are able to specify products on behalf of the manufacturers they represent so that purchasing departments can not substitute lower cost or alternative products. Reps work with the customer to identify process and applications challenges and then help determine the best options for the account taking into consideration costs, volumes, manpower and other factors.

Other functions of a manufacturers' representative include providing "high touch" services and market research. They can consult on application, specification, product assemblage, and troubleshooting. Manufacturers' representatives can also provide quick entry into the market, as they will often know the decision-makers in the customer's management team. They can also provide training on industry best practices, environment risk assessments, and product implementation.

Well organized manufacturers reps should have very powerful CRM tools that track all meaningful customer interactions as well as all historical quoting activity by the customer and by account. Clients of the rep firm should also be able to see a sales pipeline or funnel with stage of sale and expected close dates as part of the sales management process.

Costs of Using a Manufacturer's Representative

The cost of using a manufacturers' representative can be a significant factor in your business. Reps work as independent contractors with the aim of selling and specifying a client's products. Because they are independent contractors, they do not work directly under the supervision of the manufacturer. The relationship between a rep and a client is more like that of a business-to-business relationship. Costs of using manufacturers reps is generally a percentage of the selling price and can vary depending on the nature of the product and the involvement of the rep in the selling process.

Rep firms work with manufacturers to provide a wide range of services to their clients. Often, they aim to develop relationships with their customers, helping the manufacturer and the rep grow their relationship. Reps may also provide installation and maintenance activities, as well as consulting on efficiency solutions. Unlike an in-house sales team, a rep firm may specialize in several product lines and industry related services.

Reasons to work with an industry focused manufacturers’ representative

Independent OEM Electronic Manufacturing Sales Representatives: One of the advantages of working with a manufacturers’ representative firm is that they are often faster to spot new opportunities than a manufacturer's direct sales force.

Manufacturers reps are very adept at creating new opportunities by virtue of being in accounts for one application and uncovering numerous opportunities that were not identified previously. The ability to develop new opportunities is a key differentiator to remote, telephone / virtual sales effort. There is no way to really know if a remote, virtual seller is in contact with the decision-maker and if there are other factors that are impacting the purchase decision.

Independent sales representatives also represent more than one line of products. They provide information for customers and end users about new products and technologies, conduct market research, and alert manufacturers to new laws or codes. In addition, a Manufacturer Representative can save a manufacturer money on travel expenses and employee benefits.

To learn more about how to work with Restronics Corporation to represent your line of business, please reach out to us at or complete the contact form and our management team will be happy to connect with you.