Q&A - questions which should be asked by retailers or manufacturers who consider hiring a third-person service merchandising firm - In-Store Service Merchandisers

Discount Store News, Oct 7, 1996

Q: How do you recruit your field representatives, and what role do your field supervisors play in the screening and hiring process A: Fifty percent of a firm's field reps should come through personal referrals and the rest through advertising. Supervisors should interview reps or work with them once on a trial basis before hiring.

Q: Do you ever subcontract or out-source work to other firms? Do you ever use temporary agencies or independent contractors? A: This is acceptable only is notified in advance and has no problem with the use of outside reps.

Q: What quality control measures do you employ to assure that work is performed correctly and on time? Can you prove your on-time call coverage and scope of coverage? A: A dedicated audit team that spot checks stories for compliance is a good approach. Also ask to see the firm's computer-generated call logs.

Q: How much time would pass before you would know that a scheduled service call was not made? A: The same day or one day later is common.

Q: What is your ratio of field reps to field supervisors? A: 10:1 is a gold standard, with most firms probably at 15:1. These numbers can mislead, however, since some firms incorrectly label their senior merchandisers as field supervisors. Get these good to have a lot of experienced senior merchandisers working on your behalf, though they don't have supervisory responsibilities.

Q: Do you have regional offices in the field? A: It is better have this physical presence closer to the stores being serviced.

Q: How do you train your field reps? A: Detailed operations manuals and hands-on working with experienced merchandisers are two good approaches. Ask to see examples of recent technical and procedural manuals.

Q: Are your field reps on W-2 or independent-contractor status? A: Some firms whose reps are W-2 status say their reps are more focused, committed and easier to manage; they say more firms are going W-2 in order to avoid tax questions with the Internal Revenue Service. Firms using independent contractors say they have the greatest flexibility and a bigger talent pool of experienced merchandisers. Firms using both say it's most important that work is delegated appropriately. If concerned about tax questions, consult your attorneys and accountants.

Q: What is your project turn-around time? A: It is up to the hiring manufacturer or retailer to define job specifications and expectations. A project may need to be done in, say, 2,200 Kmarts within two weeks; another may be more complex and require six weeks.

The process cannot really be sped up, but a merchandising firm can intensify work schedules and call on a flex force to complete a surge project on time. A hiring retailer or manufacturer may also hire multiple merchandising firms to get more people into stores more quickly and complete a timely project.

Q: What is your historic execution rate? A: This is like asking a manufacturer's fill rate - how much of an order do they actually supply. In this case, the question asks what percent of stores that should be worked in actually are; 97% is a good target rate, through a hiring retailer or manufacturer may have different expectations. At 97%, for example, the other 3% of stores will get the attention they're due, but possibly as long as a week or two later. The execution rate is a key measure of a service merchandising firm's quality.

Q: How much do you charge? A: Fees vary by the type of assignment, geographic market and whether service is rendered during the day or night. The board range, sources say, is from $15 to $50 and hour, with most agreements in the $18 to $25 range per hour plus mileage allowances. Negotiate rates and the portion that needs to be paid up-front.

Q: In which trade classes and categories are you experienced? A: Look for an experience match with your project.

Q: What is your particular knowledge of specific accounts? A: Merchandisers should know the tendencies and rules of each retailer they service, such as backroom and inventory handling procedures, in order to assure compliance and maximum efficiencies.

Q: Do you cover all stores within an account? A: Some firms only service stores in more densely populated areas and avoid outlying locations. Keep looking if that scenario doesn't meet your requirements.

Q: Are you able to do in-store demonstrations? A: Demonstrations and merchandising require two completely different sets. If you need demos, hire a demo firm. For a list of such firms, contact the Field Marketing Services Association at (800) 338-6232. For a list of service merchandising firms, contact the National Association for Retail Merchandising Services at (888) 52-NARMS.

Q: How expert are you at category management? At planogramming? A: Don't pay extra for these skills if you don't require them. The majority of merchandising firms are tactical implementers of category managements sets, not strategic partners in developing them. However, firms that give quick feedback from the field about what's selling and what's not make the hiring retailers and manufacturers better able to adjust sets promptly for maximum productivity.