Growing a Global Rep Sales Force with Scott Lindburg

[00:00:01] Hi everybody, welcome to the Flowing Sales Podcast. Today we have Scott Lindburg with us.

[00:00:07] He was kind enough to take some time out of his day to chat with us about his experience

[00:00:12] in manufacturing, working with rep firms and so forth. He was actually a recommendation

[00:00:17] from some other folks that I was chatting to you with and had on the show. And so

[00:00:22] he comes highly recommended as having good stories. So welcome to the show.

[00:00:25] Scott, we're glad that you're here. Thank you. Thank you. Lots of good stories. None of it has

[00:00:30] anything to do with the rep business. All right. Maybe we can weave it in or something. So your

[00:00:34] CEO, I have Quell. So we'd love to maybe just hear a little bit about Quell. You were talking to me

[00:00:41] earlier that you think you have 15 to 20 manufacturing rep firms you guys work with. So

[00:00:46] we'd love just to hear about that and then we'll get going. All right, sounds good.

[00:00:49] Yeah, today I'm president of Quell Corporation. We're out of Albuquerque, New Mexico. But

[00:00:54] if I can, let me start with my background a little bit. So at the age of three,

[00:00:59] my folks started a manufacturer's rep firm in Colorado. It was called Lindberg Company. So

[00:01:05] I've been around the rep business since 19, well I'm not going to tell you, since I was three years

[00:01:08] old. Because I don't want to age myself. So I was around the rep business since I was three

[00:01:13] years old. I joined our family rep business in, I'm now going to age myself, 1983. I was in

[00:01:20] the rep business for 21 years, I believe. And left the rep business to join the dark side,

[00:01:28] the manufacturing world with a semiconductor company called Advanced Power Technology. Did that for a

[00:01:33] few years. They got acquired by MicroSemi. Started doing consulting with Quell in 2013, if I go back

[00:01:43] that far. And they had me come down and consult them in regards to manufacturers reps. They

[00:01:48] wanted to look at using reps. And I went down and looked at Quell and said, this is the coolest

[00:01:52] product I've ever seen. All we got to do is hire reps around the world and we'll double,

[00:01:56] triple the sales. And that's what we've done since then. And what Quell does is we make an EMI RFI

[00:02:02] filter insert. And I'll show you on here. It goes into a connector. And I don't know if you

[00:02:09] can see it there or not, but there's chip devices inside of this. And it makes a standard

[00:02:13] connector, a filtered connector in a matter of seconds. That's cool. So you were the guy actually

[00:02:18] that you came into Quell when they had no reps and you're like, we're going to go set up all

[00:02:23] these relationships. We're going to get reps and we're going to move the product. Absolutely.

[00:02:27] When I got down there, they had two people in sales trying to cover the world sitting in

[00:02:31] Albuquerque. And I said, that's great. They're two qualified people. But if we went to reps,

[00:02:35] you know my background, I've been a rep as long as I've been a manufacturer now. And the rep

[00:02:41] world is by far and away the best way to go to market. You've got synergistic lines. And if I

[00:02:46] can tell it aside, a story about when I went to Advanced Power Technology, we took one house

[00:02:52] account because it was an account that I owned that I was in all the time. And so we did that on

[00:02:57] a direct basis. And we went to reps around the rest of the West Coast as a direct sales person.

[00:03:02] I was not successful in that account because I only had one line to go talk about. And I

[00:03:10] were direct. We'd go in and talk about, well, first of all, I don't have the relationships

[00:03:14] because I don't have 15 synergistic lines. So the rep business having synergy and being in that

[00:03:20] customer, that customer is your customer. And you have those relationships and you go on and sell

[00:03:24] other products where I was just selling one. So we quickly in about six months, we turned

[00:03:29] that over to the rep and went back to the rep model all across the board.

[00:03:33] That's a cool story. Can you tell me they hired you to do this? So it sounds like there

[00:03:37] wasn't like internal resistance, like, oh, we're just going to do this internally.

[00:03:41] They were already on board with what you were doing, right?

[00:03:44] I don't think Quell was on board. They were going to hire a rep. They didn't really know

[00:03:48] what they were getting into. And I actually went down and interviewed their first rep, great

[00:03:52] sales guy wrong market. But just the background and understanding the rep world

[00:03:57] and the rep business, I asked questions that they never would have asked.

[00:04:01] And it takes 18 months to 24 months before any sales person can get going.

[00:04:07] And it took us about 24 months and then it took off. Then they were on board.

[00:04:11] All right, well, there's a couple of things done packed there. I think one is

[00:04:14] with the lead time like that, you know, 18 months, 24 months, how do you continue

[00:04:19] to convince them like this is going to work, right? Like just give it time. How do you

[00:04:23] do that? Well, you have to convince people to have a little bit of patience and it

[00:04:27] takes the right people at the top of an organization. So the two founders of Quell

[00:04:31] had patience and you could feel, and I don't like the word feel, you could feel that

[00:04:37] things were changing and there was a lot of activity, but you can feel things going

[00:04:41] well and you can see the activity. But if you don't see the samples, if you don't

[00:04:45] see the quotes and you don't see the orders, those results are going to come,

[00:04:48] but you do have to have patience and a lot of manufacturers do not have that patience.

[00:04:52] Well, again, a lot to unpack there. How do you, with that kind of a lead time, what are the things

[00:04:58] you look for to know that it is working in the way that you want it to so that you're saying we're

[00:05:03] doing the right thing so we get the result in a year? Because if you're wrong, it's like, well,

[00:05:08] shoot, like now we just wasted two years. Like, what are the leading indicators?

[00:05:12] Yeah, so the end result, right? The end result, what we both want as a manufacturer and a rep

[00:05:18] increased revenue. My revenue is sales, the manufacturer's rep revenue is commissions.

[00:05:24] That's the end goal, right? To get there you have to do the blocking and tackling. So the first thing

[00:05:29] we got to do is we've got to get in front of customers and we got to tell them what we do,

[00:05:32] right? So we get in front, that's the first thing. So if you're making sales calls,

[00:05:35] if you don't make sales calls with your reps, they're making sales calls for the other 15

[00:05:39] lines they have. So you got to get out and do that, you got to make sure you're

[00:05:42] meeting all the customers and training them because that's the training grounds for most

[00:05:46] reps, right? When I'm out in front of the customer and I'm making the presentation,

[00:05:50] the salesperson for the rep is listening and going, oh, never would have said it that way.

[00:05:54] And so they learn a lot. So that's the first thing. The second thing for us is samples.

[00:05:58] Sample activity is really, really key. If we don't get a sample, everything we do is custom

[00:06:02] and unique to the customer. So unless I get a sample in their hands, they will not buy it,

[00:06:07] right? It's not like I'm selling a chip capacitor where I can just say, yes, I have an O402

[00:06:13] X7R cap. I've got to have a part that is specific to your needs. Once I get that in their hands,

[00:06:19] then I got a shot. So we measure samples and then after samples, did we get approved? We follow up,

[00:06:25] we quote it, book it. Got it. Okay. So you do have some leading indicators you're looking at there.

[00:06:30] I watch our sample activity extremely closely. Every month I run a report on sample activity.

[00:06:36] Ample activity. Okay. You mentioned as well, there were things that you asked and looked for

[00:06:41] when you're bringing on this initial round of reps that maybe other people wouldn't have asked,

[00:06:47] right? Because you'd been a rep for so long, you kind of knew what you were looking for.

[00:06:51] Can you help us with that? Maybe someone else is thinking like, oh, I'm going to bring on some

[00:06:54] reps. Like are there any things you could say to help in that scenario? There's a lot of things.

[00:06:59] So we just hired a rep down in Florida. And I went through, we had about eight different

[00:07:03] companies that we talked to and kind of analyzed, right? And when I look at a new rep,

[00:07:08] I'm looking for how many lines do you have and how synergistic. I mean, I want synergistic lines

[00:07:13] that you're going to the same places that we're going. So that's one item. Another item is what

[00:07:17] markets you in. I'm particularly fond of military defense and aerospace for Quo because

[00:07:22] that's the majority of our business. So are you as a rep in military defense and aerospace?

[00:07:28] Or are you mostly industrial or where you at? So what markets do they fit in?

[00:07:32] What are their key customers? I also look at the number of people they have. I'll feed on the street,

[00:07:37] feed inside. Are they engineers? There's a lot of those things, right? So we just hired Conley and

[00:07:43] Associates in Florida. Very excited about having them on board. They just started here July 1st.

[00:07:48] We announced it in August. And they've got a bunch of engineers on the street, great culture,

[00:07:54] great fit, synergy wise and market wise. So excited to have them on board. There are a

[00:07:59] lot of good reps out there. And at the end of the day, it's about driving revenue.

[00:08:03] Yeah, we've talked about synergies of markets and customers, things like that. What do you look

[00:08:10] for in terms of or maybe you don't look at this but like structure of the rep firm,

[00:08:16] maybe approach of the rep firm, how they manage their rep firm, those kinds of things.

[00:08:20] Are those important? And what do you look for there?

[00:08:22] So I do like to know compensation methods. Are you straight commission on accounts? Are you a pool

[00:08:30] method? Things like that. I do like to look at a succession plan. Are you involved in the ERA?

[00:08:36] Do you have CPMRs on staff? We talk about all those things. And so I've got a big matrix that

[00:08:41] we talk about. If I go back to the first rep that I interviewed, he was a new rep. And a lot

[00:08:47] of times reps have great ideas. And I drilled down, I said, so what you're trying to do is going

[00:08:53] to be very difficult because you're trying to cover a huge territory and it's just you.

[00:08:59] And his thought was I could hire a couple more people very soon. And I'm looking at his line

[00:09:04] card that he had. And I said, you don't have the income. Because I've been a rep, I understand

[00:09:08] what it costs in the rep business. You get X dollars in commission. That's not profit.

[00:09:14] Commission is not profit. It's the revenue for the rep business. And they take that revenue and they

[00:09:18] pay salaries, but they also pay expenses, travel, entertainment, internet, everything you got to do.

[00:09:25] So it's having the rep background as a manufacturer has been invaluable.

[00:09:29] Well, back to your story. I mean, super interesting story. How long did it take to build up

[00:09:33] your rep workforce? Right? Like you brought one on like how long was the process to get

[00:09:39] everything in place? Yeah, that's a good question. So when we started this, we started in 2014.

[00:09:44] We hired our first rep because of my background being in the rep business and being active in the

[00:09:49] electronic reps association for since I was I'll say three, I knew a lot of reps around the country.

[00:09:55] So I knew folks and I look at their line cards, you'd be a good fit. And so starting off,

[00:10:02] we were begging for reps, right? We needed bodies. And so I called some of the folks

[00:10:06] that I knew that had synergistic lines. And I said, Hey, Bob, would you be interested in our

[00:10:10] product line? And I showed them what we have. And our product is very unique. And most people

[00:10:16] haven't heard of it. And once you tell the story, it kind of sells itself. And so I was able to

[00:10:21] fill the rep network pretty quickly in 2014, we probably had more than half of our reps

[00:10:27] signed in 2014. We went a little bit slow. We didn't go and hire 10 reps on day one because

[00:10:34] the organization wasn't ready. We weren't ready to pay commissions. We weren't ready to take all

[00:10:39] the phone calls, we were ready to travel. So you don't do it all at the same time. You do two or

[00:10:44] three now travel with them due to a three later. And I think within 12 months, we probably had 10

[00:10:49] of our reps signed at that point. Got it. And you said most of this came from your just your

[00:10:53] network like people you knew or maybe you knew someone that knew someone kind of a thing?

[00:10:57] Right. Yeah, most of the folks we started with early on were folks that I knew from previous

[00:11:02] you know, working at APT advanced power technology or micro semi. And then I did some consulting

[00:11:08] for a filter company. And so I knew those folks. And so I would call for example Wallace electronics

[00:11:14] in the Southeast. I knew them they sold well for us where I was doing some consulting at a

[00:11:19] different company. And I call them up and I say, Hey, you've done a great job. Do you want to

[00:11:22] try quell? And I said, here's what we do. And so it was a relatively easy sell because our

[00:11:28] product is so unique and fun. That's cool. Do you recommend people maybe do that? Like

[00:11:33] again, manufacturers thinking about going the rep model, are they better served hiring a consultant

[00:11:38] for example that knows people in the space to set up a program like this? It seems like there's

[00:11:43] lots of just kind of latent knowledge that is helpful, right to do it. Yeah. So I helped a

[00:11:49] company as a doing some consulting with them about the rep business. And I didn't I didn't

[00:11:54] charge for as a consultant. It was just a friendly relationship. And I said, look,

[00:11:58] if you're going to hire reps, don't hire 10 at a time. Start with three, figure out how to work

[00:12:04] with it. And when the rep model fails, and it does fail, when the rep model fails, typically,

[00:12:11] I don't think it's the reps fault. I think it's the factory's fault because we didn't do

[00:12:17] the right things to support them. So a lot of manufacturers hire a rep say, here's your

[00:12:22] brochure go out and sell something. They're not trained. They're not ready and out of sight out

[00:12:26] of mind, right? So if a rep rep has 15 lines, 10 lines, 20 lines, whatever it is, somebody's

[00:12:33] calling them and saying, Hey, what's going on with this account? What's going on with this

[00:12:36] account? And so manufacturers need to support their reps. They need to go out and travel.

[00:12:43] I have had reps that have have fallen, right? Have not done the job. And I typically

[00:12:48] point at me. First I pointed at me, what am I doing wrong? What can I do different to support you?

[00:12:54] And typically we're pretty good at what we do. And more often than not, they say, no, it's my fault.

[00:12:58] I got to do this. I said, well, let's come down and travel. And so I have a particular rep in

[00:13:02] mind of what makes any names who wasn't doing the job and had a conversation with them. And

[00:13:08] within six months, things have turned around and today they're just flourishing. And it's

[00:13:13] just given support. It's given support. And again, I always pointed me and I learned that

[00:13:17] from my wife. Yeah, you learned a lot of important things from your wife. What was it in that

[00:13:23] conversation? Was it was it simply like they needed more attention? So you were more top of

[00:13:29] mind or was there something that came out of that conversation where you're like, oh,

[00:13:32] like we're missing this thing that we need to help better? A little bit of talking to the wrong

[00:13:36] people. That was part of it. There were some other things within the organization that they

[00:13:41] were struggling with just interpersonal problems. Life happens. So we got to talk about that.

[00:13:45] And so we worked through that. And then I said, what can we do? Let's get this thing going again,

[00:13:50] because we were doing well when we started and then we fell off. So I really think it's travel.

[00:13:56] The big thing that solves anything is going visit. And as long as you have a good relationship

[00:14:00] with somebody and they want to travel with you and you want to go make sales calls and make some

[00:14:03] money, it works. This is still a people business no matter how much people are trying to get

[00:14:08] out of it. It certainly is. It certainly is. And that's one of the cool things I think

[00:14:12] about it is it's so like face to face and people driven kind of in an age where everything's going

[00:14:18] digital. There's still this component that's so that you almost can't, I mean, not that you want

[00:14:22] to escape it, but you can't escape the personal interactions in the industry. You can't and we

[00:14:28] got to drive it. We got to drive it as manufacturers. We got to drive it as reps and the reps are

[00:14:32] the feet on the street. They're in the customer. They know them personally. They're the ones

[00:14:36] who really drive that relationship. That's good. Well tell me, you mentioned Quelle has

[00:14:40] just a super interesting story, a really cool product. And so you guys are a really good fit

[00:14:46] for the rep model. We have to do the rep model. It's going to go crazy. Are there certain manufacturers

[00:14:50] where you're like, well, maybe they shouldn't do the rep model? Or is there some questions you

[00:14:55] need to ask yourself as a manufacturer to figure out, is the rep model for me? Do I need to do

[00:14:59] this or maybe stay away? So one of the things I do is I teach at the CPMR course down in

[00:15:05] Austin, Texas. That's the certification for professional manufacturers representatives.

[00:15:09] And I talk about manufacturers and all manufacturers are different. And there's reasons

[00:15:15] manufacturers go direct. And I heard of a connector manufacturer that recently went direct.

[00:15:21] And the reason they went direct is they wanted more control. They wanted more control of the

[00:15:26] salespeople. And you absolutely have more control over salespeople when they report directly to

[00:15:32] you and they have nothing to do but sell your product. So every day I get up in the morning

[00:15:36] all I do is sell Quell. From my standpoint, there is no better way to go to market. I mean,

[00:15:42] as I mentioned, I was direct on one account and going in saying, do you want to buy my

[00:15:48] EECL from Quell every week doesn't work because you miss the G2 that you get when you sell your

[00:15:54] capacitors or switches or filtered components or shielding, you miss that. And so as a rep

[00:16:01] when I went into our largest account and I wouldn't go in and start selling my largest

[00:16:07] product line, I go sell the other product lines because they're going to talk about that. They

[00:16:11] knew that I had that line. They say, Hey, while we're talking about switches, I need to talk to

[00:16:15] you about this. Right? So-and-so is working on this program and you better go talk to him.

[00:16:20] I didn't get that G2 as a direct person. I really do not believe there's a product line

[00:16:26] that shouldn't be managed through manufacturer's reps. The synergy is so important. The relationships

[00:16:32] are so important and there's no way- I mean, you think about the cost of it. If I went direct for

[00:16:37] Quell, how many salespeople could I hire? I might be able to hire four around the country.

[00:16:44] Right now I have with my reps and distributors, I probably have 200 people that can sell

[00:16:49] sell Quell. So I can't do it and I can't have those relationships, those one on

[00:16:53] relationships that the Conley folks in Florida have with their folks, their customers.

[00:16:59] They're going hunting with them. They're going fishing with them. They're seeing them daily.

[00:17:02] I can't do that with four people. Yeah. Let's get back to the story. It just,

[00:17:06] I think is really interesting, especially since it seems like it's been such a

[00:17:12] windfall for you guys and I don't know if you can share numbers or not, but if

[00:17:15] you can give us a sense for the impact that the rep model has had, right? Like you were

[00:17:20] there for the entire journey. What was it like? Was it sort of a steady growth? Do you hit a

[00:17:25] hockey stick and all of a sudden it's like, whoa, this is really cooking now. Like what,

[00:17:28] what happens, right? Yeah. Quell is a subsidiary today of Hyco Corporation,

[00:17:34] which is out of Hollywood, Florida. So I can't share any numbers, but I will say when we started,

[00:17:39] our sales were here and we just took off on a very consistent growth pattern until COVID.

[00:17:45] We're market driven, but we're not market driven. So when COVID hit,

[00:17:48] we had a little bit of a slide because aerospace is a big part of our world. So we,

[00:17:53] we slid a little bit in the COVID two years, but then we kicked it back up and we're on

[00:17:59] that growth curve again. One of the things I think people fall back on both reps and

[00:18:03] manufacturers is, oh, our business is down because the market's down. I'm not a

[00:18:07] markets down, oh, whoa, is me kind of guy. We're not dependent on the market.

[00:18:11] We're dependent on us. The more we design in, the more we're going to grow.

[00:18:14] And we just got to keep our foot on the pedal and keep designing product and keep sampling

[00:18:20] products. I measure those samples every day or every month, measure quotes every month,

[00:18:25] I measure shipments, backlog, the key metrics to make it happen. So it's been a great growth curve.

[00:18:31] That's good. That's good. You mentioned also, you know, you got to start slow,

[00:18:35] you know, maybe initially you don't have the infrastructure you need

[00:18:39] to really support the rep is what you're saying, right? So what, what goes into

[00:18:43] that infrastructure? You know, I'm sure it's cultural as well as operational,

[00:18:48] maybe technological. Like what are the things you should think about to build what you need to

[00:18:52] make it work? That's another great question. So when you're, when you're just starting in the

[00:18:57] rep world, right, you don't have any reps out there. First of all, you need to understand

[00:19:00] what reps do, right? And you understand what makes them successful. So the company that

[00:19:05] I consulted with, I said, Hey, look, start with two or three reps and get a feel for

[00:19:10] what they're doing, right? And you have got to go and travel with them. And you're going to take the

[00:19:14] incoming calls and you got to learn what those calls are going to be. They are not experts in your

[00:19:18] product line. Again, all I do all day long, and every manufacturer, all they do is sell their product.

[00:19:24] So I'm an expert at our product. And you as our manufacturers rep, you have 15 lines,

[00:19:29] you're probably not an expert in any of it, but you've got enough to sell the product,

[00:19:34] right? And so, you know, there's training. You have to train people sell what they're comfortable

[00:19:40] with, they sell for people they like. And so you've got to train and train again and train again.

[00:19:45] And I remember in my rep days, I was learning about a product and heard it the first time.

[00:19:49] And for the 30 slide presentation, after five slides, my mind was scrambled because it

[00:19:55] was so technical. I heard it again. I got through slide 10 heard it again. I got through

[00:19:59] slide 15. After I heard it five or six times, I go, I think I got this still was never going to

[00:20:04] be as good as the factory engineer. So training is really, really important. Making it easy. So

[00:20:10] from a manufacturer standpoint, I remember the old Staples Easy button, I don't know if it's

[00:20:14] old, maybe it's there. Maybe it easy. If you can make your product line easy and fun and

[00:20:20] fund itself, I mean, it's going to help your manufacturers rep. So they're going to go do

[00:20:24] it. What's hard when you make stuff hard, I need a forecast monthly, I need monthly reports.

[00:20:30] That's that's not the right way to go about it. We don't even ask for reports from our reps. We send

[00:20:34] a report out and say, here's what we're tracking. You can send it back if you want, but I'm not

[00:20:37] asking for it, right? I want you to know what we're tracking. We follow up very well to make

[00:20:42] sure that the right things are taken care of. Interesting. I hear from a lot of reps that

[00:20:46] I talked to you now they're getting asked for more reporting, right? Like call numbers and all

[00:20:52] this like metrics and things like this more and more they're getting asked for that. You're

[00:20:56] saying like, don't do any of that because it just bogs down the rep. There's better ways

[00:21:01] to make sure the reps doing what they should be doing, right? Yeah, look, I think reports are

[00:21:06] important if used correctly. And I think the reps should do their own report. They should have

[00:21:11] their own report that they use to manage their business and drive their sales and revenue.

[00:21:16] If they want to share that with me, great. But me asking for a report, if 15 manufacturers

[00:21:20] ask a rep for report every month, those are going to take them a half day every month to do. So

[00:21:25] there's a quarter of the month that's gone, right? I want our reps out in front of the customers.

[00:21:30] I want them out selling. I want them handing out samples and swag and brochures and telling the

[00:21:36] quell story. I don't want them doing reports. I want them selling stuff. Yeah, right on. Right.

[00:21:40] Well, we've hit time. I want to be respectful of your time. I know you got lots of quell

[00:21:44] to sell and you've been kind of giving me 30 minutes here. Is there anything

[00:21:48] you'd want to leave off on advice? Just any last words for our listeners that are looking for

[00:21:53] either on the rep side or on the manufacturer side. You know, it's all about driving revenue,

[00:21:57] right? And having fun doing it. I think you need to make it fun. Drive the revenue. And

[00:22:01] if there's one thing that I would say that helps drive revenue, it's great follow-up. If you do

[00:22:08] great follow-up, if you do great follow-up, you'll tell somebody so you communicate. And

[00:22:13] if you tell somebody to communicate, you'll drive your relationships both with your customers

[00:22:16] and your factories. And then you're going to drive revenue. So that's it. Hey,

[00:22:20] it was fun talking with him. Enjoyed it. This was great. I think this is a great discussion.

[00:22:24] I really like the fact that, I mean, you've lived it, right? You were a manufacturer rep.

[00:22:28] Now you're in the manufacturing world. You built the entire rep network for the company. So

[00:22:34] there's a lot of, I guess, weight behind your words. And so I think this would be a great

[00:22:38] one for the audience. So I appreciate your time. All right. Hey, thank you so much

[00:22:41] for having me. All right. Thank you, Scott. Appreciate it.