Though there is no one definition of a broker in the food industry, loosely defined, a broker is an independent sales person or organization that represents manufacturers in a specific trade class, usually in a defined geographic area.
Many people have an outdated perception of brokers, seeing them as picking and choosing who to represent based on whether or not they like a product. However, according to Dianne Keeler Bruce, principal and owner of DKB Sales & Marketing, Inc., the brokerage world has changed over the years. Today’s broker is a trained professional well versed in the manufacturer’s and customer’s needs with in-depth product and market knowledge. “There’s a lot more data behind it now,” said Bruce. “Brokers need to have a deep understanding of a product, as well as what stores and customers need.”
In a recent SFA Working with Brokers webinar, Bruce and Michael Reich, SVP of business development at Hanson Faso Sales and Marketing, Inc., spoke about why makers should invest in a relationship with a broker. The top three reasons include:
- Administrative support. Clients looking to reduce overhead by cutting back on their support team can lean on brokers to help take on some of that work. This work often includes a lot of administrative support, said Reich. For example, brokers can help manufacturers prepare for virtual presentations and marketplaces, cost changes, and even help manage supply chain logistics. “At the end of the day, we’re here to support manufacturers and customers.”
- More effective communication. Brokers are a conduit of information and communication between manufacturers and customers. “When we are talking to the client, we are the customer expert. When we’re talking to the customer, we are the client ambassador,” said Reich. The broker’s job is to be aware of everyone’s needs and effectively communicate that to all involved parties.
- Access to information. Brokers have access to category data and insights to help manufacturers better target what customers want. Reich noted, “We need to keep our clients informed of what’s happening in the industry, because, a lot of times, they turn around and have to report on what’s going on to someone else.”
In addition, Reich addressed the myth that brokers can only handle one brand in a given category. “This comes up a lot,” he said. Makers should seek to understand how a broker will manage conflicting lines; find out how they plan to commit to a fair share of time, pricing and promotional confidentiality, and to never swap out a product for a competitors. At the end of the day, it’s about trust, said Reich. “You should be able to tell right away when interviewing someone if you trust them with your business,” he concluded.