It stands to reason that if there is a person or a company filling a link in the supply chain, that their position within the chain is, indeed, useful and vital. Really, if there was no need for that particular segment of the chain, it would have fallen to the wayside some time ago. One particular link in the chain that hasn't been given much ink lately is the stocking rep and his role in the industry. What do reps do? How do they do it?

Deftly navigating the waters between the manufacturers and the distributors, the manufacturer's representative sells supplier product to distributors, and sometimes, as in the case of the stocking rep, inventories, invoices and ships product to those distributors.

"I really respect the reps who are able to stock the product," says Vinny Matteis, owner of AMVAL Associates, a manufacturer's rep firm in Lyndonville, Vt. "I did it about 15 years ago, and though it was not as profitable for us, I have a lot of friends who continue to stock, and have made a success of it."

Matteis, who started his company 24 years ago, covers New England and New York, selling and promoting tools to distributors and OEMs.

"We only stocked two lines, and that's where the profit didn't work for us. You need several lines to make money at it," he says. "Now, we are a selling organization only."

For John Pittman, C.P.M.R., president of Pittman Industrial Marketing, the definition of a stocking rep, "provides solutions to customers, and the customers are the distributors and their end users. The idea is to work together to find what solution will work best for the end user."

Pittman started working at Pittman Industrial in 1987, first in outside sales and then in operations. Pittman's father, Jack, started the business in 1973, and began stocking products in 1981.

"The idea behind [stocking] is to have product available on a regional basis," says Pittman. "Logistics were not as fluid then as they are now, and not having those regional warehouses was an obstacle in growth. Now, though, we also are an additional value to the manufacturer and distributor, enhancing the synergy between them."

Picture a manufacturer headquartered in Texas, who wants to put inventory in other places in the country, such as New England, California or Washington. Their intention, when working with a stocking rep, is to have the inventory closer to the distributors who need it.

"Those regional reps will inventory all that product and sell it to the distributors as they order it, freeing up the manufacturer's warehouse space and having it closer to the distributors," says Dave Turpin, a manufacturer's rep of 17 years.

Turpin owns two companies, Turpin Sales & Marketing, Inc. and Turpin Wholesale, Inc., in West Springfield, Mass.

"Years ago, the distributors stocked more product, but today they tend to only stock the popular items, and have less room for a full complement," says Turpin. "Also, with the market, distributors are sourcing other lines and need to buy in smaller quantity. They can do that with a stocking rep."

As an example, the advantage to the California-based distributor, as the rep's customer, is that they have a warehouse and product support in closer proximity with a California-based rep, than if they were dealing straight through the Texas-based manufacturer.

"The relationship between the distributor and their rep is usually very strong," says Pittman. "They value all that we can do for them. If the distributor needs a single product that they don't have or don't carry, the regional rep can get the product to the customer the next day."

Turpin agrees, and adds that another obvious advantage to the distributor is that they can buy product from several places and don't need to warehouse it all.

"If the rep is stocking product, it's closer to the distributor, making it easier for the distributor to do business with several lines," he says. "Their freight costs are less, and their quantities to buy are less since reps usually don't have order minimums. We make it as easy as possible for them to sell product."

In another example, Turpin cites a distributor who may have met a supplier allowance by buying direct, but in between making another order, needs one box of something right away. The distributor can call their rep and have the product sent out immediately.

As for the manufacturer, the advantage is that they don't have to house their entire inventory. The stocking rep is a halfway place to put their product.

"The manufacturer is getting their inventory closer to the distributor base," says Matteis. "And we spend more time doing the marketing and selling, taking some of that pressure off the manufacturer. But many choose to go this route for those geographic reasons."

"We are an extension of the manufacturer, in this capacity," says Pittman. "We have our own customer service to quote product or talk with the distributors; we enter the orders into the manufacturer's systems; and pick, pack and ship. We even print out the manufacturer's packing slips and labels."

Stocking rep companies tend to be larger animals simply because taking on the housing, packing and shipping the product is a huge responsibility.

There are two types of stocking reps out there. Some reps inventory and sell their product on consignment, meaning that they pay the manufacturer for the sale after they sell it themselves, and some who sell wholesale, meaning that they buy the product and then sell the product.

"Their actions are very similar to a distributor's, in that they do collections, shipping and receiving, and stocking," says Matteis. "The difference, of course, is that they sell to distributors, but the basic company functions are the same."

"Stocking reps tend to have more success with the larger products because distributors don't have the room, and the ability to have them available," says Turpin. "Because of that, the stocking rep's place in the industry has grown, and there is still a lot of room for more growth.

"In an area where they may be serving a multitude of products, and allowing such easy access to their distributor customers, it lowers the price of doing business while increasing their profit margins," he adds. "From an end-user perspective, your stocking rep is an adjunct to the manufacturer, and aids in everything that you are doing."

Pittman Industrial has not pursued adding any more lines, even with the company's success in that arena.

Says Pittman, "We were never a large stocking rep, and recently, our value has been more in product application, training and technical applications than acting as a warehouse."

Adds Matteis, "The stocking rep has been around and will continue to be. The ones that do it, do a great job of it, because the fact is that people buy from people—that's the sales function. Warehousing reps can be a huge advantage to a distributor. But, as always, the successful businesspeople adapt to the marketplace."