Business people that accept this are forgetting that the provider’s costs related to maintaining a direct sales force are substantially higher than supporting an agent program. Salary, benefits, training, desk space, manager salaries, office supplies, sales support and sales engineers – all those costs add up and are substantial.
Every telecom provider has an agent program and a direct side.
The direct team exists because it provides the company more control. The carriers can manage their sales force and have more command of the sales process. With the aid of structured compensation plans, they can lead their sales reps to offer certain products and services. By using direct reps, phone and internet service providers are able to achieve a higher level of ownership of accounts, aiding in renewals and upgrades. Direct reps promote the carrier’s products and services – they don’t offer multiple carrier options – so prices can be maximized.
Agents are independent contractors; they only get paid if they sell a service. Agents can’t be managed like direct reps and only incumbent providers, like Qwest, AT&T and Verizon, can successfully set sales quotas for them. What dictates sales in an agent’s world is price and performance. Performance might be more important than price because agents hire back office employees to manage the order process and unreliable services will end up costing them money. Agents also need to maintain the relationships with their sub agents – typically the customer’s phone and data vendors – so there’s a need to sell only the most reliable and trouble free services; anything else would make their subs look bad.
A direct rep is instantly offered a level of cache because he or she is employed by the carrier. That person is offered a level of respect that an agent might never receive. The only way an agent could achieve the same level of respect would be to earn it over time.
So how does an agent earn your respect? By saving a business time, money and making the sales and implementation process as smooth as possible. They earn respect by managing their installs – coordinating the efforts of everyone involved – obtaining the best price possible and always being available, even after a business signs the paperwork. Simply put, an agent earns respect by performing.
Direct reps have access to more training and company product information. They are required to attend training sessions. An agent has access to carrier and product information but since training sessions aren’t mandatory, they’re not well attended. Agents also need to develop product knowledge from multiple providers. Typically, agents are more experienced than direct reps and learn on a need to know basis.
Direct reps are motivated by their compensation plans. A direct rep has no incentive to reduce your bill, unless it’s coming from another provider, and they tend to sell products that offer the highest level of compensation. Agents don’t have that liberty. There are only a handful of providers serving a given area but there are hundreds of agents, so agents need to distinguish themselves and saving their customers money is a good start.
Business people don’t want to burn bridges with the major telecom providers in their area. They figure that there are a limited number of options and will probably have to turn to one of those companies again in the future. They’re more likely to believe what a sales rep from one of these companies has to say. It’s easier for a direct rep to convince them that they’re receiving the best price possible. But how many times have you had the opportunity to talk to two different direct reps from the same company and have one offer better pricing? It happens all the time.
Agents put themselves in a competitive situation from the start. When an agent obtains pricing for one of their clients, they do so from 5 or 6 providers. The providers know they’re bidding against other providers and lead with their best pricing.
The truth is that phone companies need direct reps and agents. They need direct reps to push their services and promote their companies and they need agents to compete with and motivate their direct reps. Without direct reps and agents a carrier couldn’t grow their customer base and their existing subscribers would be vulnerable to the competition.
A business needs to determine which option works best for their particular situation.
If you are looking for basic service and your business phone bill averages less than $200 a month, a direct rep from the incumbent provider, like Qwest, AT&T or Verizon, is probably the best way to go. If you have multiple locations, spread out across a number of cities and states, which are serviced by a number of providers, an agent is best because they typically represent providers across the country. If you’re time is limited but want to secure the best possible pricing for your business phone and internet services, an agent is your best bet. If you want to establish a relationship that will last for years and years, contact an independent telecom agent.