You must also reach an agreement about contract termination if the person fails to complete his or her responsibilities. Hoffmeister suggests you create a clause offering 30 or 60 days for beginning companies. While some companies allows reps to stay on regardless of productivity.
Uppercase Living, a Sandy, Utah-based home décor provider, signs on previous customers to show off their homes in demonstrations to friends, family, and potential clients. As demonstrators they sign an independent contractor agreement to display and sell products as well. Uppercase Living requires demonstrators to generate $300 in sales each quarter. Demonstrators who fail to meet the requirement are placed on a 3-month "pending period" to either make it up or decide to part ways.
Remember to consult with a lawyer to make sure you aren't violating any state or federal tax codes. Sometimes laws vary from state to state, so you need to pay special attention to areas like health insurance as well.
Dig Deeper: Employee or Contractor?
Working With Independent Sales Reps: Motivate, Support and Reward
With clients such as the Grand Hyatt Hotel in New York City and the Four Seasons Beverly Wilshire in Los Angeles, Lusive Decor's Cooper has no problem attracting talented reps. The trick is keeping them motivated.
She says that reps have to feel like having your company on their line card is a "feather in their cap," which comes naturally as your brand starts to grow. Cooper's support has been crucial to the company's success even as her industry overall floundered over the past few years, helping Lusive Decor to rank No. 310 on the 2010 Inc. 500 list.
"The attention that [the company] gets from representatives is directly proportional to how much they're earning from your product," adds Hoffmeister. You can also encourage reps to sell more by providing opportunity for growth. Hoffmeister says it's not uncommon for reps to actually join a company's full-time sales team once the company expands. When a rep delivers a significant amount of revenue for your company, it becomes worth it to hire him or her full-time, with the salary as the reward for all the hard work.
Another way to keep reps motivated about your product is to offer incentives to your most productive sellers. Direct selling companies, which employ independent sales reps called direct sellers or multi-level marketers, often take this tactic to the next level by offering everything from vacations, cars, free products and more to reps.
Brandi Rainey is in charge of training and preparing the demonstrators at Uppercase Living, a direct selling company, for their sales presentations. Since she trains a lot of stay-at-home moms with little or no sales experience, Rainey has to rely on the genuine interest the reps have in promoting the product. "My No. 1 goal as a trainer for the company is to help demonstrators remember that passion they have for the product itself," she says. Uppercase Living gives out marketing points that demonstrators can accumulate to go towards trips and recognition at conferences.
Dig Deeper: Turning Sales Into Science
Working With Independent Sales Reps: The Direct Selling Route
Companies like Uppercase Living use reps as direct sellers to demonstrate and ultimately sell products in high numbers. Not only is direct selling a cheap way to market and spread a product, but it can also help in the recruiting effort as well.
"It's a word of mouth strategy," says Amy Robinson, a spokesperson for the Direct Selling Association, which represents around 200 direct-selling companies. "What it means in the end for a company is that they spend a lot less money on advertising and overhead, and a lot more money compensating those people who are selling their products," Robinson says. These companies rely on a multi-level compensation plan, she says, where sellers recruit, train, and mentor other sellers for the firm.
This strategy gets to the heart of why companies like Uppercase Living have flourished in recent years. With a weak economy and poor job outlook, many are looking for ways to supplement their incomes or get good sales experience under their belts. "Women develop strengths and talents that they didn't know they had," Rainey of Uppercase Living says. "You see them blossom as people," she adds.
Clearly not all products, or all indsturies, require personal demonstration. If your product won't necessarily benefit from this type of service, you can still provide your reps with the tools and materials they need to succeed. Lusive Decor, for example, maintains catalogs, mailings, and e-blasts that reps can use to keep up with customers in their territories. "We make sure that our reps have beautiful road cases," says Cooper, which makes clients excited about new products and designs.
Whether you use them as direct sellers or otherwise, reps can be a great resource to take your product to the next level. If you know how to train, where to look, and how to negotiate, you'll be well on your way to imminent sales growth in the future.
