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More about sales representatives and agencies

Sales representatives or agents are individuals or companies that perform specific duties on behalf of an appointing company or manufacturer. In most cases these representatives are independent marketing resources utilized by successful companies to promote products to specified customers or to generate sales within a defined territory.

Sales representatives and agents have duties and responsibilities similar to company employees. That is, they perform duties and fulfill obligations that are normally associated with tasks performed by employees within a sales department. For example, the authority and responsibilities of sales representatives and agents is confined to the following areas:

• Calling upon customers identified and approved by the manufacturer,
• Giving sales presentations and accepting purchase orders on terms and conditions approved in advance by the manufacturer, and
• Acting within prescribed authority limits relative to pricing, delivery and other considerations given by the company.

As opposed to distributors and dealers agreements, sales representatives are NOT required to:

• Purchase manufacturer's products,
• Maintain an inventory or warehousing facilities, and
• Operate a retail location, unless directed by the manufacturer.

Essentially, the sales representative is an independent contractor authorized to offer and sell a manufacturer's products in a given territory. As an agent, the sales representative does not have authority to establish prices beyond those provided by the manufacturer. In recognition of the efforts of the sales representatives, sales commissions are paid based upon agreed rates.