Do Pharmaceutical Reps Make Good Money

Looking for Reps in All the Right Places

Prescreening recruiting independent sales reps.

Here you are with a breakthrough product in an industry that hasn't seen any innovation in a decade. The world should be beating a path to your door, right? Well, Lucinda Seigel, president of Dark-to-Light (DTL) -- a manufacturer of energy-saving streetlight controls in Pembroke, Mass. -- learned that the future of her young company depended on her ability to beat a path to the right independent sales reps.

In 1991 DTL made the transition from shipping test samples to selling just under $1 million in products. The company has 60 independent reps from 18 organizations across the country. Seigel's recommendations for finding and evaluating sales reps:

Ask potential customers. Even before it had any sales to speak of, DTL depended on the generosity of would-be customers (utilities) to pass along the names of reps they respected. To get the leads, Seigel attended industry seminars, where she met engineers and marketing people from utilities around the nation.

Target your search. Seigel recruited about half her reps from the ranks of the specialized Electrical Equipment Representatives Association (EERA), in Kansas City, Mo., which she learned about from one of the first sales reps she interviewed. In the EERA she found an exclusive club of 150 or so top rep agencies. The EERA's directory told Seigel which rep groups serviced which territories and product lines.

Interview rep agencies in person. In face-to-face talks, most agencies, each of which might represent a dozen or more companies, are forthcoming about whether they can take new lines to market, Seigel says. She also learned to be wary of reps too ready to take on her line, because she knows her product is a tough sell. And she always inquires about a rep company's future. If the founders retire, is there enough experience in the ranks? "You can't go with an agency that hasn't thought out its succession strategy."

Offer attractive incentives. Seigel uses independent reps because that's the standard in her industry. But DTL's healthy margins allow her to put more money into training reps and to pay above-average commissions.

Widen your network. Through the contacts she made at industry conferences, she also found out about a group sponsored by the Environmental Protection Agency, Green Lights, which is charged with getting manufacturers to slash energy used for lighting. DTL joined the group and gained access to 25 utilities that could lend an ear and pass on names. A few of the utilities even became customers. -- Susan Greco

* * *

The Manufacturers' Agents National Association (714-859-4040) publishes a useful four-page report titled "Prescreening Prospective Principals and Agents: Some Guidelines" (report 534, $3.50), outlining questions company owners should ask prospective sales reps and those sales reps should ask company owners.

Jul 1, 1992