Baseball great Yogi Berra once said, “You’ve got to be careful if you don’t know where you’re going, because you might not get there.” Yogi, famous for muddling his words, likely meant to say, “If you don’t know where you’re going, you might get there.” Agents may want to heed Yogi’s witticism, even the mangled version.
When you start out as a general agent, you have a pretty good idea about the path: Build relationships with providers to ensure you have the best options to take care of your dealers. You had to fight to carve out a piece of the world from agencies with established territories.
Now, years later, after you have established yourself, the path may not be as clear. You have diversified the number of providers and you are still spending time finding new ones while managing the existing ones.
That time may not be time well spent. Valuable financial opportunities with your dealers could be passing you as you chase more providers or manage the long list of existing ones.
If you haven’t stopped for an hour to look at your agency, perhaps now is a good time to do just that and evaluate your provider relationships to make sure you are still on the best path, and know where you are going and can get there.
How the Sloth Got on Your Back
Not long ago, I encountered a mega agency that has 21 provider relationships. Many of the more than 300 producing dealers use this agent for just one product.
That agency could consolidate or purge relationships and ultimately get more growth. It seems counterintuitive to lower the number to increase growth, but managing all those relationships consumes a lot of man hours. And, the return on investment likely isn’t there for every relationship.
It’s perfectly logical that you diversify in order to not have all of your eggs in one basket. You need a fair mix to protect your agency. At the same time, you want the best programs, and you want to know that other companies are not developing better products and arming their own sales staff or agents to pursue your dealers.
Competition keeps providers sharp so they have the dealers and your agency’s best interests in mind. Providers should welcome the competition to make sure they bring their “A-game” for you every day.
But what if your providers always quickly adjusted to give you the best products, and you did not need to waste your time worrying about the competition? Imagine what you could accomplish for your dealers if you could reduce the time talking to additional providers and could focus on your dealers’ needs 100% of the time.
Doing Your Dealers a Solid
If your relationship with the dealer principal is just one as a product provider, you will be easily replaced. You need to be able to have more time to spend helping your dealers than dealing with your providers.
How solid is your relationship with every dealer? Yes, sometimes you need to get your foot in the door with a product, but once you have that, it is important to strengthen that relationship. Do you have everything possible for that relationship to grow? Do you bring new and different ideas to these dealers to help them better manage their business?
Today, dealers are busier than ever before, especially as they figure out how to compete in the digital world. Maybe you can help them with staffing. Every dealership is looking for good people. You could prove your value by finding people for their open positions. Or, you can find a provider that has a fantastic staffing solution you can provide to the dealer to strengthen your relationship.
Food, Drink, and the Gripe-and-Grin
The annual meetings providers host take you to nice, warm places where you enjoy good food, golf, and plenty of other fun activities.
However, for many of the agents I talked to recently, they said their providers did not deliver anything exciting, such as new products or technology, to help their dealers actually sell more. These agents were upset with the time they spent out of the field because they were not helping their dealers.
Recently, I worked with an agent who took two months to install a product in a dealership. Three of the weeks during that time were spent at the annual agent conferences with other providers. This was clearly a case in which managing those provider relationships took away from what was best for his dealers.
What about prospecting for new dealers and new opportunities? How often do you drive by the same dealerships knowing that the dealer is unlikely to move? You fall into that rut because your time is so precious. Your time may be stretched thin because you are going to all those provider meetings or talking to potential providers to see other products.
While you think this is research, prospecting is the first piece of your job that gets cut short because you don’t have enough time. You need to be able to spend time talking to new dealers. Chances are this is the first thing every week that falls by the wayside.
Quality Time Pays
You are always one bad day away from a lifestyle change. Spending quality time with your existing dealers pays dividends. Otherwise, it could be a painful experience.
I met an agent recently who was spread razor-thin because of so many providers. The relationships were good, but not strong enough to be anything more than a product provider. That agent’s biggest dealer left with no prior notice when they took an advance from a large provider.
That dealer was 40% of the entire commissions for the agency. If the agent had spent more time focusing on the dealer, the dealer would have known that his current agent had easy access to significant money to provide a dealer advance.
This agent is in their 60s and it turned their plans upside down on what they were going to do with the agency. In fact, the agency may never get back to this commission level. Losing that dealer was a crushing blow for the agent and could easily have been avoided.
Make sure you can spend enough time with your dealers to build enough loyalty and trust that they won’t even talk to other companies. If they need something, you want them to think of only getting it from you.
A good example is what another large agent told me about how they handled providers to focus on dealers. They only recently secured a third provider for the business after having pared the number down several years ago. They had tried to manage eight providers but eventually determined that number diluted their value proposition.
For his agency, it is just table stakes for a provider to have a full suite of products. They actually did less business when they had eight providers. They felt eight providers meant eight different agendas that had to be managed. This agency has doubled their business in the last five years after limiting their providers and focusing more on their dealers.
What Can You Do?
I advise agents to find providers that not only have full suites of products, but can also take care of your needs beyond every product.
For example, how many agents do business with a few different companies to have multiple reinsurance solutions? This has recently become an area of specialty where agents need several companies to have every reinsurance option to offer their dealers. This does not need to be an area of specialty.
Multiple reinsurance options free you to take care of your dealers and their needs without spending time searching for solutions. How great is it to spend your time focusing on your dealer instead of interviewing providers to cobble together various reinsurance solutions? Your dealer will look at you as a consultant and earn you “trusted advisor” status.
There will always be other companies nipping at your heels for your dealers. Imagine if you worked with providers that could actually help you keep competitors out of your accounts and be an asset to you and not just a product provider.
Don’t spread yourself too thin. Find a couple strong providers and let them help you engage your dealers. Aligning with a provider that can provide great products and help the agent engage the dealer beyond products will help you get to significant growth because you will know where you are going.