Starting a Business as a Manufacturer's Rep

If you like to sell and yearn to be out on your own, the life of a manufacturer's representative, also known as an independent sales rep or just plain rep, may be for you. Experienced salespeople tell us being a manufacturer's representative is the graduate level of selling, offering potentially higher earnings and freedom from company politics.

The typical sales agent represents eight to 10 complementary products that don't compete with one another. Typically, someone coming into this field is in their early forties and has had 20-plus years of experience in an industry, according to Joe Miller, president of the Manufacturers' Agents National Association (MANA).

As a rule, manufacturers both inside and outside the United States use outside sales forces instead of having in-house sales personnel, because in this productivity-conscious era, using a rep workforce is a more efficient and cost-effective way to sell products. In fact, according to Miller, the practice has become so common that corporations often call MANA complaining of a shortage in good sales reps.

Despite this demand, breaking into this field is not a cakewalk. It takes one to two years to develop a stock of enough products to represent that will make you a good living. Also, a new rep must often take on startup companies who may or not have lasting power. While the entry costs are not high--an equipped home office and a good vehicle are all that's needed--you'll have to have a way to cover your living expenses during the startup years. But like many salespeople, the potential earnings are good: Members of MANA average more than $150,000 a year in pre-tax income.

One change from the past is that reps today are doing more than selling, hence the importance of having experience. Some reps train company personnel in the use of the products they sell, offsetting a cost their customers would otherwise carry. Some reps who sell to wholesalers make joint sales calls with the wholesaler's in-house sales personnel, training them to sell the rep's products.

Most manufacturer's reps sell industrial products to manufacturers and end users such as processing plants, HMOs and government agencies. While there are still some sales of consumer products, like food brokers who sell to grocery stores, for example, for the most part, the "big box" retail stores buy directly from manufacturers.

Finding products to represent can be done by working trade shows for your industry where both manufacturers and customers can be found. In addition to good old-fashioned shoe leather, reps make wide use of the internet--to find products to represent, to identify prospective customers and to get listed on sites like www.replink.com, which offers online product information on thousands of companies products that's accessible 24/7.

If you're interested in becoming a manufacturer's rep, start your research by contacting MANA or any of the trade associations for individual industries, ranging from food service to plumbing and heating. You can track down such associations by searching the web.

Paul and Sarah Edwards are coaches and the authors of 16 books, including Best Home Businesses for the 21st Century. You can contact them at www.workingfromhome.com.