As someone who writes regularly, I can tell you that some columns are easier to write than others.
This is one of those tougher ones because the subject matter is delicate and, truth be told, makes me a bit discouraged.
I need to talk to you this week about business ethics, and perhaps the lack of them.
I am willing to bet that the minute I brought up business ethics, many of you recalled the recent and unexpected shutdowns of United Furniture Industries (parent of Lane Furniture), Klaussner Furniture and Mitchell Gold + Bob Williams, and how this trifecta of tragedies robbed thousands of workers of their livelihoods.
You’re probably also questioning why these companies allegedly gave loyal employees no notice. I wondered the same thing.
And while moves like these certainly tarnish the reputation of the home furnishings sector, a recent string of conversations I’ve had with some reps now leads me to believe that some independent sales reps may also need to take a good hard look at how ethically they treat fellow reps.
After receiving several phone calls from reps angry over the behavior of other reps, I received this letter that essentially expressed the same concerns.
Although I won’t reveal the author of the letter, I am going to quote directly from his letter to me.
The rep wrote the following: “With Klaussner, Lane and other companies closing, and with companies like Hillsdale and others getting rid of independent reps, I am seeing very bad behavior out there.
“Just recently, an IHFRA member based in the Northeast area that was associated with one of the companies that closed basically took a line from a long-standing rep and has taken other territories from other reps. The rep he took the line from was offered the opportunity to work for him for 50% of the commission he was making previously.
“While I know many people are hurting out there, there is no excuse for this behavior from the rep or the manufacturer that went along with it. No integrity.”
He went on to say, “There are a lot of factories/suppliers that will take business any way they can get it and don’t care, and this encourages bad behavior by reps. This behavior is awkward, it wastes time and efforts, and creates distrust between the retailer, the supplier and the reps. If it doesn’t get addressed, a lot of talented people are going to just leave the industry, and a lot of younger people will never really have a chance to make it.”
The rep suggested that I devote a column to this issue, and since I agree that this behavior is counterproductive and unbecoming to our industry, here it is.
But I feel that simply calling attention to the issue is not enough. I think we need guidelines, a code of ethics for reps, if you will, to establish some sort of ground rules.
Here is my short list:
Honesty, trust and integrity: Sales reps should always be honest and transparent in their dealings with each other. They should not engage in deceptive practices or make false claims about their products or services. When independent sales reps treat each other fairly, it promotes a culture of trust and respect within the industry. Knowing that your fellow reps won’t actively seek to undermine your efforts builds confidence in the network and encourages collaboration.
Confidentiality: Independent sales reps often have access to sensitive information about their clients and products. They should respect confidentiality agreements and not share this information with competitors or unauthorized parties.
Fair competition: Sales reps should compete fairly and ethically. They should not engage in practices that harm competitors or engage in price-fixing, bid-rigging or other anti-competitive behavior.
Respect: Sales reps should treat each other with respect and professionalism. This includes refraining from disparaging comments or actions that harm the reputation of other reps or their businesses.
Avoiding conflicts of interest: Sales reps should avoid conflicts of interest that could compromise their integrity. This includes not representing conflicting products or services to the same clients without disclosure and consent.
Compliance with laws and regulations: Independent sales reps must comply with all relevant laws and regulations in their industry and region. This includes adhering to anti-bribery laws, data protection regulations and industry-specific codes of conduct.
Transparency in compensation: Sales reps should be transparent about their compensation structures and terms with clients and other sales reps. Hidden fees or undisclosed commissions can harm trust and reputation.
Customer-centric approach: Sales reps should prioritize the best interests of their customers. They should aim to provide solutions that genuinely meet the needs of clients rather than pushing products or services for the sake of commissions.
Prompt payment: If one sales rep subcontracts work to another, they should ensure prompt and fair payment for services rendered. Delays in payment can strain relationships and harm the reputation of both parties.
Resolution of disputes: When conflicts or disputes arise between independent sales reps, they should make a good-faith effort to resolve them through negotiation or mediation before pursuing legal action.
Continued professional development: Sales reps should invest in their professional development to stay current with industry trends, technologies and best practices.
Environmental and social responsibility: Sales reps should consider the environmental and social impact of the products or services they represent and promote ethical and sustainable options when available.
While these are just guidelines, the journey of a thousand miles begins with the first step.
When it comes to ethical business practices, let’s not just talk the talk. It’s imperative that we walk the walk.