Succession Planning For Your Suppliers, Contractors And Manufacturers’ Reps

A company that relies on partner businesses should begin by assessing its key relationships. A simple way to think through the list is to start with sales, thinking about sales reps, marketing consultants, and advertising suppliers. Close to sales is customer service and delivery. Prior to that is operations. Before that is purchasing. All along the path are information technology, accounting, as well as human resources, and legal advice.

For each relationship, the company should assess the availability of alternatives. Unless the company is located in a very small town, there will be abundant choices of accountants, lawyers, and general IT consultants. A great accountant’s retirement may be unfortunate, but it won’t be disastrous. However, the more specialized and unusual the business partner, the harder it will be to find a replacement. A contract manufacturer supplying unusual, custom-designed parts may be a challenge to replace. A sales rep who knows HVAC contractors in Anchorage and who does not represent any competitors could be difficult to find.

In most cases, the list of at-risk partners will be fairly short. The first step is to start a conversation, according to Charles Cohon, the CEO of Manufacturers' Agents National Association and a former manufacturers’ rep himself. He notes that some reps may feel nervous about the subject, fearing that the conversation might be a signal that the company plans to sever the relationship. Business continuity is a concept that most reps will understand, however, and the company’s commitment to the relationship will go a long way to helping the conversations progress over time.

The conversation is a vital step not just for manufacturers’ reps but for any critical business alliance. In fact, succession planning for sudden illness or death, as well as retirement, will enhance the both companies’ resilience over time. And with a broader scope of the conversation, the subject can be part of an annual review of the relationship even when the agent is years away from retirement. The rep who has spoken about succession to the principal every year since age 50 will not be alarmed when the subject comes up at age 65.

View single page >> |

Disclosure: None.

How did you like this article? Let us know so we can better customize your reading experience.


Leave a comment to automatically be entered into our contest to win a free Echo Show.