Sales Rep Report Card

Salespeople are a crucial, if not the key link in the sales process. Yet, we really know very little of how they see themselves, much less how they are seen by the manufacturers/providers and the buyers they serve.

A survey commissioned by the Toy Industry Association and executed by my consulting firm, Richard Gottlieb & Associates, aimed to find out. We wanted to know: How good a job do toy industry sales people do? Are they good communicators? Are they knowledgeable? How is their follow-up?

And what about the differences between the two major types of salespeople who serve the industry: house salespeople and independent sales representatives. House salespeople are employed by manufacturers and represent only that company's line. Independent sales representatives are self-employed and represent a number of lines. Do buyers prefer to work with independent sales representatives or would they rather work with house salespeople? What about manufacturers? Which do they prefer?

In order to find out, the survey asked salespeople, buyers and manufacturers/providers the same questions about the quality of sales currently offered to the toy industry. By comparing and contrasting responses from these three groups, we are able to see where buyer, seller, and provider agree and disagree about performance.

There is no credential one needs to have, no test one has to pass and no list of best practices to be a successful salesperson or organization. It seems that the only measurement of consequence is sales volume.

Should sales volume, however, be the sole arbiter of determining success or failure? After all, a great product can overcome the worst kind of salesperson. Shouldn't there be other measurements so that we are able to determine gradients of skill and so salespeople can get better at what they do?

If you have ever seen a great salesperson at work you appreciate that not only is great selling a profession, it is an art. I'm not talking about the razzle-dazzle kind of selling depicted in scores of imaginations in which the “cunning” salesperson talks someone out of their life savings through silver-tongued trickery. I'm talking about the salesperson who realizes that making a sale is like an iceberg—90 percent of the activity takes place before and after the call. The best salespeople spend enormous amounts of time researching their customers in advance of the call; and thereby shaping proposals that, like a tailored suit, fit the customer's exact dimensions.

Quality of sales is therefore no small issue. Making it even more important is that the very existence of sales as a profession may be in question. With the Internet allowing direct producer-to-buyer contact, some are beginning to question whether the industry actually needs salespeople? As one buyer surveyed said: “I think [manufacturers] should all move toward Internet ordering, lose the rep, save that percent, and pass the savings on to retailers.”

The Toy Industry Association sent the survey via email to 4,357 individuals. This included its members as well as the attendees of the 2005 American International Toy Fair. Seven percent, or 315 people, voluntarily responded to the survey. The responses were predominantly independent sales representatives, independent specialty toy store owners, and manufacturers.

Of the salespeople who responded, nearly 86 percent were independent reps, 9 percent were house salespeople and 5 percent described themselves as “other types of sales.” Of the providers who responded, approximately 72 percent were manufacturers, nearly 7 percent were distributors, roughly 6 percent were importers, and almost 15 percent were “not designated” in any of those groupings.

As seen in Fig. 1, the overwhelming number of respondents (95.5 percent) uses either independent sales representatives or a hybrid force consisting of independents and house salespeople. Very few in the industry use only house salespeople. Therefore, independent sales representatives play a major role in virtually every toy sales organization in the country.

A subject that has been endlessly debated is whether salespeople favor the buyer or the manufacturer/provider. Common wisdom has been that salespeople favor the retail customer. After all, they can always get another job or factory to represent but they can't necessarily get another customer. It was therefore a surprise that over 50 percent of manufacturers (see Fig. 2) found salespeople to be fair and equitable. Not as big a surprise, but certainly noteworthy, was the more than 60 percent of buyers who agreed.

Even the negative opinions appear to support this conclusion that salespeople are impartial as 40.6 percent of manufacturers who think that salespeople favor buyers balances against the 34 percent of buyers who think they favor manufacturers.

We do not, however, want to ignore the fact that more manufacturers do see salespeople as favoring buyers than buyers see them as favoring manufacturers. Common wisdom may be correct that salespeople favor buyers but certainly not to the degree that was suspected.

When it comes to insight into their retail customers, according to the survey results, almost 50 percent of manufacturers (Fig. 3) believe their salespeople to be very knowledgeable, and nearly 98 percent of them thought their salespeople were if not “very knowledgeable,” at least somewhat so. Buyers don't seem to be so generous. In fact, the majority (almost 60 percent of buyers) think that salespeople are, at best, only somewhat knowledgeable. Of more concern to manufacturers should be the approximately 15 percent of buyers who see salespeople as not being knowledgeable about their business at all.

A buyer can only know as much about a product as the salesperson who presents it. As the decision to buy or not to buy may well pivot on that knowledge, it behooves every salesperson to know as much as possible in order to increase the chances of making the sale. It is equally imperative that every provider makes an extra effort to ensure that their salespeople are highly educated in their products.

It therefore was surprising that more than three quarters of manufacturer/provider respondents are of the opinion that sales people have, at best, only fair product knowledge (Fig. 4). Buyers were similarly negative—half found salespeople's product knowledge to be fair or worse.

Follow-up is at the very core of what constitutes professional selling. How many sales are lost because a salesperson failed to complete the quote sheets, get back with a price or send a sample? In order to find out how reliable salespeople were seen in providing follow-up, the survey asked two questions on the subject: 1. In general, sales people provide: good; fair; or poor follow up (choose one); 2. When I request information from a salesperson: I am confident it will be done; I am not sure it will be done; I am confident it will not be done (pick one).

When answering the first question, salespeople gave themselves a 78.2 percent rating as “good” at follow-up. They would be wise to pay close attention to the 67.3 percent of buyers who see them as either “poor” or “fair” at it. Manufacturers should be even more concerned as lack of follow-up costs them orders.

Buyers who responded to the second question gave salespeople reasonably good marks when it comes to following up requests. Salespeople should, however, be concerned about the remaining 44.8 percent of buyers and 67.4 percent of manufacturers who are not sure follow-up will be done.

Based upon this poll, salespeople are failing their factories and buyers in this most elemental of job functions. But failure is not the fault only of salespeople. Manufacturers who supply poor, unintelligible and incomplete sales material are setting themselves and their salespeople up for failure. Furthermore, manufacturers that are slow to respond to their own salespeople with information and decisions are giving fleet-footed opponents an opportunity to pass them by.

Forecasting is an essential component in assuring that manufacturers have the correct amount of inventory to meet customer needs. Salespeople know their customers best and are in the best position to supply this crucial data. According to the survey, however, the majority of manufacturers (54 percent) deem salespeople to be at best moderately reliable at forecasting, and the majority of salespeople (67 percent) agree!

Why do salespeople perform so poorly in this area? It may be because they undergo so much rejection and disappointment that they must be optimists to do their jobs. Optimistic people provide optimistic forecasts. Their tendency is, therefore, to typically aim high.

Making it even more unlikely that salespeople will aim low is that attempts to be realistic and forecast low may bring accusations from sales managers of being poor salespeople or having bad attitudes. If, on the other hand, salespeople forecast high, and then disappoint, they may be accused of over-inflating the company's inventory.

What is the answer? Ironically, it may lie not with salespeople but with sales managers. If they know their salespeople forecast high, they need to factor that in when preparing their own resulting forecasts. They must also think about their attitude when asking for forecasts. Giving salespeople safe harbor if their initial forecasts are lower than desired may go a long way to providing more reliable data and happier salespeople to boot.

Communication is the keystone of the sales profession. Therefore, salespeople should be looking for the same high marks from their constituents that they give themselves. Nearly 95 percent of salespeople participating gave themselves “good” marks as communicators, but only 42 percent of manufacturers and 63 percent of retailers agreed.

And when it came to a salesperson's responsiveness, 56 percent of buyers and 52 percent of providers say it takes one or more days to receive a response. If salespeople want a clue as to why they are not perceived as good communicators by more constituents, they must look here. In this age of instant communication, responses are needed immediately. The benchmark for best performance must be hours, not days.

The common wisdom is that buyers prefer house salespeople. The surprise for manufacturers may be that, by a small margin (40 percent versus 36 percent), buyers actually prefer independent sales representatives. We therefore conclude that using house salespeople does not put the provider at a disadvantage or an advantage.

The business world, and the toy sales industry in particular, are going through historic change. The very existence of sales as a profession may be in question. What these survey responses tell us is that salespeople are looked upon for far more than just selling a product. They are seen as the eyes, ears and brains of the clients they serve. They must provide a strong added value to manufacturer and retailer in order to assure their own future as a profession.

Salespeople are not in this alone. Manufacturers and buyers have a vested interest in a sales profession that knows fully what is expected and how they are doing in fulfilling that expectation.

The best way to make sure that salespeople are meeting the expectations of those they serve is for buyers and manufacturers to talk to them, not just about them. This dialogue is vital to every provider, every buyer and every salesperson. It is therefore vital to the industry.