Fifteen years ago, there were many in the distribution sector who predicted the demise of the outside salesperson. Some experts believed the exploding growth of the Internet would mean that buyers would eliminate distributors in purchasing products.
But nothing like that has happened. In fact, distributors are rapidly adding to their sales forces to find new customers and further penetrate existing accounts. Take Grainger, for example. The giant MRO distributor had said it would hire 200 new sales representatives in 2015. Now it says it will double that number to 400. Kaman says it has completed the process of hiring 60 additional salespeople "to help drive organic growth by addressing identified market opportunities." MSC Industrial and several other large distributors are hiring additional salespeople or will be in the near future.
Fastenal, one of the larger distributors in the MRO arena, is taking the lead in hiring sales and sales support personnel. A little more than a year ago, the Minnesota-based company, with more than 2,600 stores in operation, said it wanted its salespeople to spend more time with customers and less time with non-selling tasks. Fastenal announced that it would hire more than 1,000 people, mostly in sales support positions. The company has actually exceeded that goal. In its Q2 earnings and supplemental information released July 14, the company showed it has hired 1,392 people over the past 12 months, with about 80 percent of that total added in the last six months.
Full-time selling personnel count was 12,582 at the end of June. The company made a major sales hiring push in June, adding 361 sales personnel in the month. Fastenal has added 1,397 selling personnel so far in 2015, and now has 510 more than it did at the end of June 2014.
Many of the overall hires have been part-time employees, a way for Fastenal to recruit future personnel from two- and four-year technical colleges. “We recruit people with two-to-four years left in school with the hopes that when they graduate, they can come work for us full time and can hit the road running,” said Dan Florness, Fastenal’s chief financial officer in a conference call with financial analysts.
Fastenal says the company is focused on adding “energy” into its stores to free up the time of salespeople who will then be spending more time in face-to-face meetings with customers.
The Hunt for Qualified Employees
And it’s not easy finding candidates who want to make a career in distribution, which many describe as a “non-sexy” business. Yet as we know, distribution and manufacturing offer excellent careers.
Scott Jochum, a member of the Industrial Distribution faculty at the University of Nebraska at Kearney, says that all 50 graduates in the school’s distribution program were offered positions in the industry prior to graduating. Those students each received three to five job offers. Jochum praises a school program that allows students to work at distributors on an internship basis. Many of the students are then offered positions at those companies.
"Distributors we work with are greatly pleased with the results," Jochum says. "It’s a win-win. It gives the student exposure to our industry and it helps employers determine if those interns are a good fit."
He points out that much of the focus in the industry today is on supply chain activities but added there are tremendous opportunities for students who have technical sales training in areas such as fluid power, bearings and other products, as well as training in sales techniques.
"If we had 400 students in the program we’d have 400 students at graduation who would have jobs," he adds.
Another top-notch university, Texas A&M, has an outstanding industrial distribution program and on its website points out that every student in its ID program had a job at graduation. Many of those students were offered jobs in sales engineering and sales management. The graduates received an average of three job offers, and the average starting salary was $52,000 with some receiving up to $70,000. They were recruited in many industry sectors such as manufacturing, distribution, and consulting.
Many of the industry’s top distributors and manufacturers annually make the journey to Texas to meet with potential recruits from the long-time ID program.
There are also a number of other schools with successful ID programs, such as at the University of Alabama, Clarkson, and Eastern Michigan University, along with many others.
The Sales Challenge
All these successful ID programs show the need for finding technically proficient salespeople, a problem that has been mentioned in the past by many employers.
As just one example, a fluid power distributor recently said it took months to fill two sales positions because he couldn’t find the right candidates.
"I found some people who were good salespeople, but didn’t have the technical knowledge or people who had the technical knowledge but not the sales expertise," he says.
A story earlier this year in a Wall Street Journal blog proves the need for salespeople who are technically proficient. Here’s an excerpt:
Sales reps who peddle technical and scientific products earned a median annual wage of $74,970 in 2012, more than twice the median for all workers, according to the Labor Department. A competitive hiring market for science and tech workers is part of the reason, but employers also say young workers are uninterested in sales — a field they perceive as risky and defined by competition.
Technical sales and sales management positions play a critical role for U.S. businesses, but they are among the hardest to fill, according to a 2014 report from Harvard Business School’s U.S. Competitiveness Project. Employers spent an average of 41 days trying to fill technical sales jobs, compared with an average of 33 days for all jobs for the 12-month period ending in September 2014, according to Burning Glass, a labor-market analysis firm that worked with Harvard Business School on the report.
The article also mentions something we have been saying for years: there is a strong need in our industry for salespeople who are problem solvers and not just sellers of products. That’s something to keep in mind.
Jack Keough is contributing editor of Industrial Distribution. He can be reached at email@example.com.