As if being a furniture sales rep wasn’t hard enough before COVID-19, it is downright crazy now. Many in the industry are fighting their own battles with product flow due to supply chain disruptions and are starting to understand what place a good rep has in the selling process.
Before COVID-19 shut everything down, reps would attend markets, go back into the territory, present their wares to buyers, and go into the stores and train the sales personnel. Any problems such as customer service issues would be resolved by the rep working with factory and retailer. Most of the time, reps would struggle with getting retailers to return phone calls about product suggestions because the retailers had so many choices and so little floor space. At the same time factories would push for floor placements so they could plan cuttings. Definitely the middle man taking care of retailers and factories problems.
Then along comes COVID-19. Government shutdowns force people to stay home and disrupt the supply chain. Money is printed and given to people who can’t spend it on anything service- related, so they turn to sprucing up their homes which they are confined to. All of a sudden, home furnishings is one of the hottest categories around, and everyone wants to buy. As a salesperson in the industry that sounds like a great deal, and it is … until it isn’t.
All of a sudden the reality of supplying everyone who wants furniture runs into the challenges of finding factory workers who want to work while the government pays them to stay home. It runs into material cost inflation that hasn’t been seen since Jimmy Carter waspresident, and yet it’s called transitory.
The industry finds out some of the countries that became big furniture manufacturing sources — such as Malaysia and Vietnam — have closed due to spikes in COVID-19, sending retailers and factories scrambling to find new suppliers in other countries. And through it all freight climbs from $3,500 to $4,000 a container to more than $20,000 with no real forecast of when it will come down. The freight ends up being 50% to 100% of the cost of the actual product. Despite the rising costs, lead times go out to six to 12 months.
Now the rep’s job has become more critical. Retailers call looking for products that can ship, and reps have to figure out a way to get factory production or turn away business. Monthly, reps have to process paperwork from their factories to their retailers about the latest price increases and dates they will be implemented.
It does not matter how big the customer is, factories need to get their price increases, or they will drop the retailer because there are plenty of other retailers looking to buy goods. Reps have to manage their customer’s backlogs because many have placed orders out for months only to see the warehouses fill up or credit lines top out.
If a retailer decides at the last minute it wants to delay taking in a PO, it will find the goods going to another customer. It’s more about managing the logistics to make sure retailers get orders when they need them vs. presenting new products.
And the worst of it all is as the factories production is all spoken for and now oversubscribed due to other countries shut downs, reps have their largest customers looking for products and there is nothing to offer them immediately. If a retailer has had a good partnership with a factory over the years, the factories are doing what they can to keep goods flowing to them. But if it’s a new relationship even if the rep has been cultivating it for years, production time is very scarce.
As a rep it is very frustrating to have worked so hard only to see all that potential business sit on the sidelines.
From a rep’s perspective, there is a long way to go before the industry gets back to predictability of shipping. Imports are challenged because of high container costs and country shutdowns. Domestic capacity is full.
Who knows what this latest wave of COVID-19 will further ravage the labor pool and supply chain in the U.S., but it probably will keep more people home looking at old furniture and deciding they need to upgrade. It looks like prices are going to continually go up in the near term because there is way too much more demand than there is supply.
If you are a retailer, buy as much as you can and don’t cancel orders. The supply chain is getting worse, not better, and you will need everything you can get.
The demand is there. If only the supply would follow, it would be a rep’s nirvana!
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August 09, 2021 at 09:43PM
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Blog: Post COVID-19 rep selling - Furniture Today
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