Cost Comparison - Sales Staff or Representation

COSTS BEFORE ANY SALES ARE COMPLETED

Costs Before Any Sales are Completed
  • Company Salesperson Manufacturers' Rep
    Salary none
    Medical Insurance none
    Employment Taxes none
    Retainers none
    Sales Staff Training none
    Supervision and review none
    Workers Compensation none
    Insurance none

COSTS ASSOCIATED WITH SALES

Costs Associated with Sales
  • Commissions Commissions (only)
  • Expenses X
  • Bonuses X
  • Incentives X

ONGOING COSTS NOT DIRECTLY RELATED TO SALES

Ongoing Costs Not Directly Related to Sales
  • Pension X
  • Retirement X
  • Vacation Time X
  • Sick Time X
  • Flex Time X
  • Family Leave/Sabbatical X

CONNECTION TO CUSTOMERS

Connection to Customers
  • A single line with limited contact outside of current customers; developing customer relationships is costly.
  • A diverse group of products that appeal to a large customer base with deep relationships throughout the industry.

What are the Advantages of Using a Rep Firm?

Lower Direct and Indirect Costs

The table to the right shows a thorough comparison of the costs associated with maintaining a sales staff as compared to using a rep firm.

Lower Administrative and Management Costs

Maintaining a sales staff can be a drain on vital company resources in ways that are difficult to measure; a rep firm eliminates these as well as training
and turnover costs.

Simplified Planning and Budgeting

With fixed commissions on sales as the only cost associated with sales, it is much easier to predict overall costs.

Motivated Representation

The rep firm and their associates are motivated to work consistently and persistently to grow sales since their personal success depends on moving products and being effective.

easoned, Knowledgeable and Connected

Rep firms have experienced and well trained staff and there is immediate access to an expanded customer base through the rep firms existing relationships. Understanding of and experience in the overall industry with knowledge of the local territory adds context and allows reps to discover new opportunities that a sales staff may overlook.

Marketing Flexibility

Using a rep firm allows manufacturers to quickly launch marketing initiatives and in many cases reps can increase volume by developing customers in new channels that would be costly to reach.

 Cost Comparison РSales Staff or Representation

Costs Before Any Sales are Completed
Company Salesperson Manufacturers’ Rep
Salary none
Medical Insurance none
Employment Taxes none
Retainers none
Sales Staff Training none
Supervision and review none
Workers Compensation none
Insurance none
Costs Associated with Sales
Company Salesperson Manufacturers’ Rep
Commissions Commissions (only)
Expenses none
Bonuses none
Incentives none
Ongoing Costs Not Directly Related to Sales
Company Salesperson Manufacturers’ Rep
Pension none
Retirement none
Vacation Time none
Sick Time none
Flex Time none
Family Leave/Sabbatical none
Connection to Customers
Company Salesperson Manufacturers’ Rep
A single line with limited contact outside of current
customers; developing customer relationships is costly.
A diverse group of products that appeal to
a large customer base with deep relationships throughout the industry.