Loyalty between vendors
and retailers
Be True to Your
School
"... so be true to your
school. Just like you would to your girl. Be true to your school.
Let your colors fly." ..the Beach Boys.
Imagine the sales
rep who walks into a buyer's office, or sees them at Jubilee,
only to find that the buyer has dropped his product line because
a new vendor offered a buy back program, a new display, and extended
dating on the initial order. What is a vendor to think?
How
about the account located in an area that now supports two or
three similar businesses? They find that after having worked for
several years to develop customers who are loyal to them and a
particular brand of products, that the vendor is now selling the
same line to the store down the street. What is the account to
think?
It was a dark and stormy night
back in April of 1967. My grandfather's store was hit by lightning;
by midnight over 95% of the store was destroyed. As the store was
being rebuilt, Grandpa was working with various salesmen, writing orders
to restock the new building.
O.C. North was a salesman that
had called on our family businesses for many years. He wrote the
necessary order and took it with him as he went to the company headquarters
for a sales meeting. The controller told Mr. North that the order
would not be accepted as they wanted to wait and see if Grandpa's
store would be fully restored. Mr. North told the controller he
would no longer represent the line if the order was not shipped.
The order was then shipped. What is an account to think?
The
sales manager from a wholesaler came to a store asking to visit
with the owner. He explained that on the next day he would be
telling his sales force about a product line they would be discontinuing.
Because the store owner had been friends with the sales manager,
dating back to when the sales manager was first a sales representative,
the store owner was given the first opportunity to write an order
for the discontinued product line.
A vendor calling on a retailer,
made a comment to the retailer that he had called on the store
at least six times and had yet to write an order. Could he convince
the retailer to change to his product line?
The retailer would
make the change only if one of several conditions were to occur:
hire the sales representative for the line the retailer now carried,
or wait until the sales rep retired or died. Otherwise, the retailer
would remain loyal to his current rep and product line.
Each
of these stories have two things in common: they are all true,
and each centers on the loyalty between an account and their supplier.
If you, as a show owner, home
based business, manufacturer, wholesaler, buyer or sales representative,
have never had an occasion where the bond between vendor and account
has been put to the test, and passed the test, then - in the opinion
and experiences of this writer - you are missing something as you
participate in your particular part of the gift basket industry.
Does a vendor really "need" the accounts they have? After all, the
vendor can usually find another account within the same trade
area, can't he? Last year this writer had the opportunity of addressing
a manufacturer and all of his sales representatives at their annual
meeting. The president of the company told the audience the presentation
would focus on the relationship between the sales representative
and the retailer. His comment was, "You know we have strict
credit terms. If you, as a sales representative don't think your accounts are valuable to you, just look around any town you have
an account in. You know we make a point to protect territories,
and I invite you to see who you would replace your current account
with. There are many situations where your second choice will
be a 'no choice' to our credit department. Take good care of your
accounts."
I think this manufacturer understands
the value of his accounts, and is taking necessary steps to assure
the continuance of his business and the business of his accounts.
The reasons why an account needs
a specific wholesaler or manufacturer are numerous. The first reason
may be as simple as being identified as the source for a specific
brand of items.
More common reasons
for vendor loyalty would be having a friend in the shipping department
who can get something out to you right away when you have a customer
with a rush order. It could also be having a friend in the credit
department when you have experienced a rough period of sales and
need to ask for extended terms.
A lot of the value with a vendor
comes through the sales representative. In our business, there
were those occasional faxes from a sales representative who was
attending their national sales meeting. The message on the fax
was to detail a new line of products which were introduced at
the sales meeting, and the rep - with our permission - had already
placed our initial order for the new items. Usually the note explained
their anticipation of a quick sell out of the initial run of production,
and how our rep wanted us to be one of the first to get the new
merchandise.
How about the rep who tells
you about the great sell-through that an account in a nearby town
is having on a particular product line? And your rep does not even
represent the line; he or she just wants you to know about it so
you can get your share of the action. Of course there are the occasions
when the rep gets you some samples of products to use as door prizes
for your open house. And the rep who is able to get you some extra
co-op dollars, or is glad to be on your sales floor one afternoon
to answer questions from your customers.
Do you, vendor or account,
really need to have that strong connection with the other as we
have suggested? Not really. But, if you would like to accomplish
your goals with a lot less effort, there probably is not a quicker
route to get there than with the help of the other.