by They say no good deed goes unpunished. They also say good things come in threes. As someone strange enough to take Latin in high school, I can tell you that this phrase comes from the original Latin phrase that says, “Everything that comes in threes is perfect.”
In light of three phone calls I received recently, I would like to challenge that statement. In fact, based on the calls I got, I’m thinking terrible things come in threes. And, for sure, no good deed goes unpunished.
Here’s why: I got calls from three different reps (each representing different factories) who said they had lines that they cultivated, grew and continued to grow, taken from them as house accounts.
And as someone who has worked with the International Home Furnishings Representatives Association for the past five years, this news, sadly, is becoming more and more commonplace, especially as the economy struggles and business for relatively high-ticket, often-postponable items like ours remains challenged.
Sadly, in the wake of economic downturns, the plight of independent sales representatives often goes unnoticed or worse, swept under the rug. These individuals, who tirelessly build relationships and accounts, are now facing a harsh reality: having their hard-earned accounts taken away by the very factories they represent. This practice not only undermines the efforts of these reps but also highlights a fundamental injustice in the business world.
Independent sales representatives who do it right play a vital role in the economy. They serve as a strong and reliable bridge between manufacturers and consumers, leveraging their expertise, networks and dedication to drive sales and promote products.
Many of these reps invest significant time and resources in nurturing client relationships, understanding market dynamics, providing marketing intelligence and advocating for the brands they represent.
However, amidst economic turbulence, some factories certainly appear to be utilizing drastic measures to cut costs and maintain profitability. One such measure is the termination or reassignment of accounts from independent reps to in-house sales teams or larger distributors. While this may seem like a strategic move from the factory’s perspective, it’s a devastating blow to the independent reps who rely on these accounts for their livelihood.
The decision to strip away accounts from independent reps is not just about reallocating resources; it’s a betrayal of trust and a disregard for the value these reps bring to the table. These individuals often serve as the face of the brand in their respective territories, offering personalized service, localized expertise and a deep understanding of customer needs. By severing ties with independent reps, factories risk alienating loyal customers and sacrificing the competitive edge that these reps provide.
Furthermore, and equally as dangerous, this practice perpetuates a power imbalance in the business ecosystem. Independent sales reps operate with limited bargaining power compared to large corporations. They lack the resources and leverage to challenge unilateral decisions made by factories. As a result, they find themselves at the mercy of these factories, vulnerable to sudden changes that threaten their livelihoods.
Moreover, the repercussions extend beyond the economic realm. For many independent reps, their work is not just a job but a passion. They take pride in building long-term relationships, supporting local businesses and contributing to the success of the brands they represent. The abrupt loss of accounts not only impacts their financial stability but also takes an emotional toll, shaking their confidence and sense of purpose.
In light of these challenges, and in light of what appears to be an uptick in this power imbalance, I think it is time for factories guilty of this practice to rethink their approach to managing independent sales reps, especially during times of economic hardship. Rather than viewing them as expendable assets, factories should recognize the value of these reps as strategic partners in driving sales and fostering brand loyalty.
Moreover, a more equitable and transparent relationship between factories and independent reps is essential. This includes providing clear communication, fair compensation and opportunities for collaboration and mutual growth. By fostering a culture of respect and reciprocity, factories can harness the full potential of independent reps and navigate economic challenges more effectively.
I know for a fact that many independent reps are out there every day representing their respective factories based just on goodwill, a verbal agreement and a handshake. From where I sit, factories that suddenly decide that profitable accounts cultivated by their reps should suddenly become house accounts, send a message that integrity takes a back seat to bottom-line results.
In the spirit of balance, I will also say that not every rep has or brings an A-game on to the field. As with any group, you will have overachievers, achievers, just-enoughs and, yes, some who should really find another line of work that they might be better suited for.
But to penalize a rep who has built up a line and consistently hit his or her numbers is just wrong.
In conclusion, the practice of taking away accounts from productive, engaged and successful independent sales reps amidst economic hardship is not just unfair; it’s short-sighted, counterproductive and destroys trust, not just between the rep and the factory, but within the industry as well.
My message to the factories is this: If you’ve developed a team of successful, loyal and productive independent reps, my hat is off to you. If you’ve hired reps who are not meeting your expectations, find reps who will. And if you are punishing successful reps by bringing their accounts in house, there is probably something that needs fixing in your house.
It undermines the contributions of these reps, perpetuates inequality in the business landscape and erodes trust within the industry. To build a more resilient and inclusive economy, we must recognize and respect the invaluable role played by independent sales reps and ensure that they are treated with the fairness and dignity they deserve.
Absolutely fantastic article Ray.
I hear the same thing from many of the reps I know from all over the country. Manufacturers can’t make it without reps. Thomasville learned it the hard way and went out of business. When very successful reps have their accounts become house accounts that’s a sign that the manufacturer is probably going to be out of business soon. The retailer should know that and then reconsider if they even want to continue doing business with that company. As a rep myself I tell other reps when they see this happening in a company they represent, they should realize they could be next and to look for another company to work for. Life’s to short to have to worry about this kind of stuff happening
If a factory believes they can manage accounts on their own, they should let the reps go completely. Or if not, let them keeps accounts they’ve cultivated. And reps should quit a line if they are treated poorly. Easier said than done, I know. But there is a lot of competition for floor space and retailers like myself are often more loyal to reps than brands. There are very few brands that the average consumer can name in the home furnishings space. La-Z-Boy, RH, Ashley, etc. beyond maybe 20 brands, the consumer has no idea which Asian factory that greige sofa was made in. They are relying on the retailer. And the retailer is relying on their reps.
Fantastic article and spot on. I see this happening more and more to rock star reps and factories that are top tier in our industry.
It is a bad long term decision by the factories and it will come back to hurt the factory, guaranteed. A good rep. can make or break a line in my stores.
thank you, Jack. When times get tough, sometimes measures become extreme…on both sides of the fence!
Ray, Good article and I am a staunch supporter of the independent rep role. My position, and frequently expressed opinion, is, “the elimination of sales representatives is a decision, deliberate or otherwise, to close.” There are, however, a few points I felt your article failed to explore. For example, it is the responsibility of each individual and business to evolve as the environment changes and find ways to stay relevant and provide value. The retail landscape is ever changing and the speed at which it is doing so is escalating. Also, there are far few retailers than a decade ago so naturally there will be fewer representatives. Finally, frequently, it is the retailer who is requesting the elimination of independent representatives as a means of reducing their product costs and increasing their own margins or offsetting cost increases. This is a difficult position for even the most pro-rep supplier who cannot afford to pay commission and reduce the retailer’s costs.
Micah, your point about each spoke of wheel adapting is right on point! Thank you for sharing your thoughts.