A Balancing Act

 

In an average work day, the to-do list for any distributor is likely a mile long. Today’s industry players offer distributors countless options to help them pare down that list; from affiliate programs to business services providers, companies offer distributors numerous options to move administrative, sourcing and technology-related tasks off their plates so they can focus on building and growing the business.

But for distributor owners who choose to operate independently, the challenge of balancing sales growth with daily operations —while also developing strategies to continue to thrive in a competitive marketplace—is a daily race against the clock.

Yvonne Lyngaas Zeman, owner and CEO of Chicago, Illinois-based Monarch & Company, says the time and labor commitment she applies to managing administrative tasks has more to do with the end game than a daily checklist. “I can only speak for myself, but the commitment to business is all day long until I consciously shut it off. I don’t know if it’s this way for everyone—and I think you can be successful in your own right by putting in as much or as little time as you want. It’s all about what you are going after,” Zeman says.

Tim Hennessy, Sr., takes the same approach. The president and CEO of Concepts & Associates in Birmingham, Alabama, says he tells people, “I work half-days: 6 am to 6 pm. The job is ongoing, and you have to be on top of every aspect of your business, until such time as you are able to afford to hire people to do some of the jobs you performed in your early years.”

Lev Promotions owner Rama Beerfas, MAS, who is based in San Diego, California, acknowledges that the amount of time devoted to such business tasks is entirely up to the individual business owner. “[For her,] Clients and prospects always come first. The back-office tasks can be done after business hours or during slower periods,” she says. “It’s a question of prioritizing the revenue-generating tasks over the business maintenance tasks.”

Sharing The Load
To ensure she can devote as much of her time as possible to developing client relationships, Zeman has learned to delegate tasks. “The process of letting go of a department in your company for someone else to manage is very interesting to me, because it takes a toll on you—mentally, emotionally and sometimes physically, if you aren’t self aware,” she says.

To determine what she can delegate, Zeman says she creates a list that identifies gaps in processes, struggles her employees are facing, and things that she herself doesn’t like doing, “until I can identify a new position in the company. I get everyone’s buy-in, and then I start the hiring process.”

When a new position can’t be created but help is still crucial, Zeman relies on contractors who can pick up work in areas such as design and marketing. Delegation is also critical for Amy Mallet, MAS, who, as president of Amsley Promotions in Neptune, New Jersey, relies on her team to help carry out day-to-day functions.

“We have delegated responsibilities, which frees me up to take care of our clients,” says Mallet, who keeps herself available for her team to address any questions that may come up. “We have an organized system for follow-through of all active orders, which streamlines the process.”

Kerri Gorman, vice president of Dallas, Texas-based Gorman Foy, Inc., says she and her business partner, President Karen Foy, managed back-office and administrative roles themselves when they were just starting out, but since then, they have been able to hire part-time employees. “This allows us more time for client relationships,” Gorman says.

Reaching Out
Even after delegation has been implemented, some distributors find they need additional support—which is where outsourcing can be a valuable tool.

“The biggest challenge for a distributor is maximizing the 24-hour day from a profitability standpoint,” says Cliff Quicksell, MAS+. Quicksell, an industry veteran, operated as both an independent distributor and as a member of an affiliate company before becoming a consultant for distributors who work with an affiliate company.

“I’m a big fan of outsourcing—any independent distributor should look at how to build a stable of people to whom they can outsource processes,” he says.

Janie Gaunce, president and CEO of Grapevine Designs in Lenexa, Kansas, agrees. “A few years ago, I realized that as an independent distributor, I wanted the best tools available to meet our clients’ needs,” she says. “After doing some soul-searching and industry evaluation, I found a business services provider for promotional marketing companies.

“Our goals were very similar,” she explains. “Grapevine’s creative strengths were important to them, and their backend operations were important to me, so it became a valuable partnership for both sides. The support allows me to concentrate on what I enjoy—working with our sales teams and clients and creating solutions to help their businesses grow.”

But, says Beerfas, there are some tasks she would not outsource.

“Personally,” she says, “I probably wouldn’t outsource product research to anyone else, since I know my clients’ needs and tastes—that wouldn’t be easily communicated to someone who is just a product researcher.”

Staying Afloat Financially
The old saying, “You’ve got to spend money to make money,” may have a kernel of truth to it, but finding the money to fund business operations is one of the independent distributor’s greatest challenges, especially when just starting out. “In the early years, you had to have one of two things,” says Hennessy. “Customers who paid before the bills were due, or a good banker who would work with you.”

Mallet adds that delayed payments from clients can make cash flow management more difficult, but her company’s credit history and a good relationship with suppliers and banks have helped secure favorable terms for her company.

“I know that cash flow in this industry is by nature difficult and complex to manage,” says Zeman, who relies on an outside service provider to assist with several of the aspects of business finance.

Beerfas adds that her biggest challenge is financing orders for clients who want 30-day terms, “especially if they don’t hold to those 30-day terms. We currently require payment in advance for all our orders.”

Defining Differentiation
“For 12 years, I owned my own company,” says Quicksell, “and I realized that to be competitive you have to differentiate. I had to do things differently to stand out from competitors. I started to dig deeper, to find out the core needs of my customer and what my customer was trying to accomplish.”

Differentiation is the primary characteristic cited by many successful distributors in the industry, whether they are affiliated with a larger group or operating independently. Hennessy defines his company’s differentiation as providing committed service with guaranteed on-time delivery and creative cost-savings ideas, among other points.

“Existing businesses change with companies moving or going out of business, or through acquisitions, so you always need to be selling … but, you have to guarantee that existing business is taken care of, that service levels remain high and intact, and that the customer is well taken care of,” he says.

Gorman says her company has taken the consultative approach with their clients, building relationships and “following up and doing exactly what we say we will do; don’t overpromise, but over-deliver.”

Beerfas believes that every distributor brings something special to their approach. “For me, it’s a mix of my professional and educational background, how I like to sell, my personal beliefs and my personality.

“I know that there are certain clients with whom I’m just not a good fit, because our personalities don’t work well [together]. But, because I am results-focused rather than sales-focused, I need to have a relationship in order to have meaningful conversations to elicit the information I need from my client,” she says.

Mallet’s methods of providing differentiated service include fulfillment, warehousing and shipping capabilities, as well as offering virtual and actual samples, and self-promotions on practical items. “Putting products in front of our clients is the best way to showcase what we believe will work for their needs,” says Mallet.

“We meet regularly with our supplier reps to be sure we are current while also getting the best value for our clients. Additionally, through long-term relationships, we share ideas and information with other distributors throughout the U.S.”

Quicksell is a strong supporter of finding niches in vertical markets to build strong customer relationships. “Being able to niche your market—finding a few lanes to become an expert in—if you can own that space, you’ll be better off. We have a lot of general practitioners, but very few specialists.”

For Zeman, the key to differentiation is her company’s ability to offer kits, as is the decision to run a “conscious company” that is fair to all stakeholders. “Running a conscious company is the competitive advantage,” she says.

Doing It Their Way
Though they shoulder the responsibility for driving the direction of their companies—and the responsibility for missteps along the journey—independent distributors enjoy the freedom to determine what success looks like for themselves.

For Beerfas, it means being able to offer consulting services without worrying about meeting sales quotas. “Some quarters, consulting fees are a greater source of our revenue; other quarters, it’s the products. It just depends on our clients’ needs,” she says.

Mallet says she appreciates the ability to steer the ship and make quick decisions, which can be both challenging and rewarding. “Having built this organization from the ground up, it’s gratifying when you have a happy staff while exceeding clients’ expectations,” she shares. “We make decisions based on what is best for our organization, which means being creative, thinking outside the box and considering all possibilities.”

Gorman says she and Foy are happy to be able to run their own business and work with clients of their choosing, while creating the flexibility to spend time with their families. The ability to “do your own thing” is also what has motivated Hennessy, along with the chance to have built something on his own, of which he says he is extremely proud.

Zeman says running her own business is like getting “a blank canvas; you are able to build a new brand on top of a preexisting, successful industry. I enjoy the freedom and risk associated with having to make impactful choices.”

Jen Alexander is associate editor for PPB.

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