How to succeed in business - by making lots of mistakes!

sounds like a good business model; interested
in knowing, if you don't mind sharing, how
do you find new accounts? and if for example
a store owner has more than one k&b dealer
or do you have to find your own accounts and
keep them from being served by someone else?

Everyone's heard about using OPM (Other
> People's Money) to leverage their profit
> margin.

> But have you ever heard of a business
> opportunity that let's the individual dealer
> take advantage of OPM to reduce the dealer's
> overhead and risk?

> The company I sell for, represents over 3800
> manuafacturers, printers, and miscellaneous
> suppliers of promotional advertising. The
> advance the commissions to the dealer at the
> time the order is placed on all pre-paid or
> open-account orders. So I can sell a 2003
> calendar in January of 2002, receive my
> commissions in January, with the customer
> taking delivery 7 to 11 months later, but
> paying me up front.

> On the occasion where the buyer fails to pay
> for their order after delivery, K & B
> charges the dealer back their commision, but
> covers all of the remaining loss on the
> order. Just one bad account can cost the
> independent thousands of dollars in lost
> commissions and the supplier's in

> They also handle all the credit, billing,
> sales tax and collections duties for their
> dealers, leaving us more time free to market
> the products and opportunity.

> K & B also provides order forms and
> pre-addressed envelopes "Free" of
> charge to every independent agent/dealer. In
> addition, every call or fax to K & B for
> whatever department is via toll-free
> numbers.

> Another way to consider the value of the
> opportunity is to compare it to the
> independent distributor in the specialty
> advertising field.

> The independent member earns 100% of the
> gross profit on every sale, but also bears
> all the credit costs and other overhead for
> their orders. They also carry all the risk
> for every order they write.

> K & B pays the highest commissions in
> the industry of any national distributor.

> Their plan is the reason why as a
> 108-year-old company, they were able to more
> than triple their sales volume in the past
> 10 years, from $18 Million in '92 to over
> $61 Million in 2002.

> And, this is partly because every dealer
> owns their own accounts. They work as 'free
> agents', able to take their accounts with
> them if they ever find a better opportunity.
> With such a policy in place, K & B has
> to deliver for the dealers, or see their
> revenues decline if they don't.

> Several of K & B's Top 1% dealers, were
> either independent agents, or selling for
> their competitor, before switching to K
> & B. Having experienced this business
> from another viewpoint, once they switch to
> K & B, there's no going back. The
> enhanced "bottom-line and increased
> respect they experience by affiliating with
> K & B tends to make them associates for
> life.

> It's almost a parallel of
> emigration/immigration to the United States.
> Freedom loving people with the desire to
> have a better life (via capitalism and
> democracy) pour in to the US at a faster
> rate than those who choose to leave.

> So, this is how K & B has used the
> concept of "shared risk" to grow
> their business at a fantastic rate.

> Dennis Bevers

> if you don't mind sharing, how do you find new
> accounts?

I'm down to less than 1 cold call per quarter. Sometimes, I'll go out of my way to make a cold call, just for a change of pace, or on a whim. But, most of my new customers this year came from 3 regular sources.

#1 Networking: I get lots of customers through contacts I make at the Chambers of Commerce. (I have memberships in 3 different cities.) Most of these Chamber events are perfect for soft selling. When I call on a client in their location, their time is limited and the attention is divided. At a Chamber function, whether breakfast, luncheon, committee meeting, business card exchange, open house for a member, etc, the pace is more relaxed and the meeting isn't as confrontational. And before cell phones, I didn't get interupted during my introduction.

In addition to Chambers of Commerce, I network through memberships in a Chemical Association which includes both the producers and their vendors. The same type events exist for business card exchanges. (Note: I rarely exchange cards. I take their card and give them one of my imprinted handouts. In addition to having some functional use that increases their desire to hang on to it, my presenting it as a card demonstrates my belief in the products I sell. I generally use ink pens, letter openers, monitor dusters (for sweeping the dust of their computer screen), pocket memo books, or band-aid dispensers. These rarely get thrown away.

#2. Directed referrals: Prospective customers contact me, indicating they got my name from "so & so", who orders from me. Or, sometimes, I receive the referrals to the prospect with instructions as to what they are looking for, or an event they need to have something in hands for. These leads are far more productive than cold calls. My existing clients are rewarding me with a vote of confidence that influences the prospect's buying decision.

#3. Internet marketing: Between my existing website which is highly ranked in several search engines for a variety of key words, I also get visitors through "pay per clicks" and from postings on some forums. I also receive some traffic from total strangers and some internet friends putting links from their site to mine.

> and if for example
> a store owner has more than one k&b dealer
> or do you have to find your own accounts and
> keep them from being served by someone else?

Kaeser and Blair is very careful to follow all the rules regarding independent agents. Because of our status, K & B cannot offer protected accounts. It is not all that uncommon for a company to buy from 2 different K & B dealers. In my local market (population under 200,000) there are 5 established K & B dealers(sales volume of $75,000 to $500,000), and I know of at least 4 clients that I serve, who also purchase from one of the other dealers.

It doesn't make any difference to K & B, as each dealer is paid commission on the orders they submit. One dealer may sell screen printed or embroidered clothing almost exclusively, while another focuses on calendars or specialty products. It wouldn't make sense to deny one dealer their commission, simply because the other dealer had sold them something different in the past year.

If I want a customer to buy exclusively from me, I had better work to be the absolute best salesman they ever used as a vendor. But, even then, a company may have 2 to 10 or more buyers who have purchasing authority during a year's time.

I have at least two local customers where I sell to 5 of more people in different departments. There may be other buyers who are also purchasing from K & B, but ordering from another dealer. I know K & B would rather have the company buying from two salespeople, rather than one K & B dealer, as well as a competitor.

And I'd rather have some of the client's business, rather than being frozen out, simply because they purchased one time from another dealer.

Even in this small market, there is more business than I can handle. So, by having multiple dealers in the market, K & B is not only following the law, but they are reaping a larger percentage of the total market.

In addition, some buyers are under orders to distribute the business around to different vendors. Even though the payments go the K & B, the commissions are going to different salespeople. It makes a difference to some.

On a side note, in '93, I became the first Century Club dealer that K & B had in Southwest Louisiana. One of the other heavy hitter is my associate, while two of the others are his associates. The fifth Century Clubber is a third generation associate. The best way to sum it up is that K & B operates on a 1 by X matrix formula. I receive over-ride commissions on all my immediate associates, and they receive the over-rides on theirs, while I get nothing.

It is a fair system as every dealer has the same right to recruit, but the overrides are paid on actual performance of the dealers each has brought on board. I had nothing to do with the recruits who my associates brought in, so I haven't earned any over-rides. It works for me.

Dennis Bevers




The products, opportunity, and company that work for me!