A Retailer's Trusted Partner

In 2002, I attended a seminar at the Dallas Market Center, where the editor-in-chief of an industry publication was forecasting the direction of our industry. Not surprisingly, the speaker talked about the growth of national retailers. During the question period, I asked what role sales rep agencies would play in the future of such an industry. My jaw dropped when the editor shook his head and said, "Not a big one."

Two years later, I energetically assert that the role of key account manager is more important than ever. The overwhelmingly positive sales results from my company's key account sales group bear out the point: a great key account manager brings significant value to large retailers, and is rewarded with high sales volumes.

Key account managers are the group of salespeople who focus exclusively on serving the demanding needs of the largest retailers in our industry. They effectively navigate the complicated networks of these broad-based retail operations. The very best key account managers become trusted partners.

To be a great key account manager, he or she must first of all have a sound understanding of the retailer's business and its goals. Through researching the company, thoughtful questioning, and even listening in on quarterly analyst calls, the manager should become an expert on the retailer's business and its merchandise requirements. For example, one large retailer we work with requires that all products have a markup of at least 72 percent. A manager who knows the retailer's requirements won't waste time with products that can't meet that requirement.

In addition, many retailers set strategic goals for their businesses, and openly discuss them with trusted salespeople. A retailer may want to extend its giftware sales into a specific market segment, such as the Hispanic population, and will mobilize its buyers to find products that meet that goal. A manager who is aware of strategic goals can help the retailer by presenting such products. Merchants view such a manager as a valuable business partner, as opposed to just a "product pusher."

An effective manager is also able to sell to different buying groups within a large retail organization. When a salesperson places products across multiple buying areas, it provides product consistency and potentially lower costs in such areas as transportation, for example.

Key account managers can also help retailers identify qualified suppliers to meet their goals. The manager brings together retailers (typically very large ones with developed business practices) with suppliers (often with smaller, less mature systems). The manager must be candid about whether a business relationship between the specific groups is in the best interest of all parties; if it doesn't make sense, the manager needs to figure out how to make it work, or scuttle the deal.

Suppliers, too, look to key account managers to place their products with the right retailers. Just a couple of large sales can reap big volumes and significant economies of scale for suppliers. And because large retailers and independent specialty stores are very different, suppliers usually hire different sales groups to service each.

Buyers also look to their top key account managers as extensions of their own buying staff. Face it, in recent years most business organizations have employed fewer people to do more work. Consequently, many buyers look to their key account managers as combination trend watchers, designers, order writers, supplier liaisons, and shipment trackers. Some managers have become so valuable that buyers turn over procurement for whole product groupings to them. And, of course, a good key account manager is highly responsive to the buying staff. A growing number of managers employ assistants to ensure this high level of responsiveness. In Texas, our company employs the industry's top manager focusing on catalogs; she values responsiveness so much that she employs two assistants.

A buyer distinguishes himself or herself by selecting product categories and styles that are in high demand. By visiting national and regional markets and being well read in industry publications, key account managers also gain expertise in identifying product trends and best selling categories. Buyers can turn to their salespeople for ideas, inspiration, and knowledge when building product assortments.

In addition, many retailers share their merchandising and trend plans for future seasons with their top salespeople in order to develop product ideas. As an example, one of our large retailers wanted to develop a set of lighting products with a French Country theme. Our team came up with some great designs, and in order to keep the prices and margins in line, the key account manager worked with the supplier to create a chandelier with four arms instead of the traditional six. Great key account managers can help bridge these merchandising concepts into concrete products that meet the themes and financial requirements of the retailer.

Our industry is going through some major changes, particularly with more stores setting up buying offices overseas to import directly from their sources. Yet despite this apparent "direct" trend, we're finding that our sales to large retailers are increasing substantially.

I strongly disagree with that editor's prediction of dramatically lower sales by agencies and domestic suppliers to the nation's largest retailers. As long as our industry's sales teams provide true value to their customers, there will be a significant and lasting role for valuable salespeople.