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MC Assembly, a leading mid-tier Electronics Manufacturing Service (EMS) provider, has developed its own innovative hybrid customer acquisitions strategy, helping the company develop and sign tens of millions of dollars in new business contracts across its three North American manufacturing facilities this year.
The hybrid sales system is a blend of indirect and direct sales elements. And the process is extremely effective and cost efficient for MC Assembly, according to Jake Kulp, MC Assembly’s vice president for New Business Development.
“The use of independent manufacturing reps in the industry is common, but this hybrid system and the elements of how we deploy this sales model is uniquely developed by MC Assembly,” Kulp said.
Instead of hiring, training and maintaining a traditional internal and large external sales staff, MC Assembly’s hybrid sales process relies on contracting with manufacturer’s representatives, which are individuals, sales agencies or companies that agree to sell MC Assembly’s services to targeted Original Equipment Manufacturer (OEM) customers. There are currently 28 rep firms in MC Assembly’s network with a total of 115 reps staffed by those firms participating in this process.
Unlike an employee sales team, manufacturer’s representatives are not paid a regular salary, only an industry average commission on successful contract wins. MC Assembly offers training and sales planning advisement, as well as targeted account discussions, but the reps are ultimately independent business men and women, not directly regulated by MC Assembly like full time employees. Manufacturer’s representatives are protected by specific targeted accounts contractually agreed on.
Timing is very important when approaching an OEM to introduce MC Assembly’s service offerings. If an OEM is not considering outsourcing or switching from their current outsourcing partners, then MC Assembly could spend years calling on the prospect through a traditional sales staff with no results. Conversely, when the time is right to begin the diligence of outsourcing, the rep engages with the leaders inside these prospects, and is alerted much like a “canary in the mine” that the prospective client is now ready to speak with MC Assembly. They are in the position to make an introduction early in that diligence process.
The most successful reps tend to be established with complementary custom manufactured lines like fabricating metal, stamping metal, machining metal, molding plastic parts, sourcing raw PCBs or selling custom cable assemblies, none of which compete with MC Assembly’s service offerings.
Traditional straight line component reps sell differently than the custom sales process follows. Once identified as a source on the clients’ specs, they focus on fulfillment. They tend to be overwhelmed by the average EMS deal, which spans about 1 to 5 years to win, which is why they’re less likely to succeed with a line like MC Assembly.
“The best reps tend to have grown up in the geographical area they operate in and have developed long standing relationships with various technical and business leaders inside the type of OEM prospects we try to sell to,” Kulp said. “This cuts down on the time it takes to penetrate and understand who actually makes decisions inside those prospects and shortens the total sales cycle.”
MC Assembly has divided the sales territory into four regions of the U.S., Canada and Mexico, managed by MC Assembly’s Business Development Managers (BDM). The rep’s goal is to determine OEM leaders who may be deciding on an outsourcing plan that could include MC Assembly. Once an initial level of “intent to outsource” is established, the manufacturer’s representative brings in an MC Assembly BDM. The BDMs then engage the potential customer to qualify and determine if working together would be a good fit.
“They get us involved at the right time so we can do this up-front diligence to be sure it’s a good expenditure of MC Assembly’s, the reps and the customers time,” Kulp said. “We vet each opportunity to determine if MC Assembly should expend resources in in trying to win the contract or migrate to other opportunities that may be a better company fit for any number of business reasons.”
“Considering all the elements that can affect a successful EMS new business development opportunity, we believe that the most effective organization for an EMS company of our size and service offerings is a hybrid system as we have deployed,” Kulp said.
About MC Assembly
MC Assembly (http://www.mcati.com), based in Melbourne, Fla., with additional operations in Billerica, Mass., and Zacatecas, Mexico, is a national leader in the contract manufacturing arena with annual revenues of approximately $200 million. It provides turnkey solutions to original equipment manufacturers and focuses on assembly of medium volume, medium mix printed circuit boards assemblies (PCBAs) and box builds. MC Assembly’s capabilities include surface mount and pin-through-hole interconnection technologies, PCB and box build, DFM, DFT, DFA engineering, in-circuit, functional and environmental testing, and full box-build direct order fulfillment.