The Difference Between Hiring a Sales Rep vs a Sales Agent

August 12, 2014 Scott Lombardi

the difference between hiring a sales rep vs a sales agentAs you begin to build your business and the business continues to grow, you will probably find that you need help to maintain that growth and to continue growing. While you take care of the day to day operations, you may find yourself in the position of looking for someone who can take on the sales and marketing aspect of your company. Based upon your needs and what you want the new person to do, you will have to choose. Do you want a sales rep or a sales agent? And, what is the difference?

Generally speaking, the terms sales rep and sales agent may seem that they mean the same thing. But the function of a sales rep is very much different from that of a sales agent.  The first and most obvious difference between a sales rep and a sales agent, is that a sales rep works directly for your company. A sales agent is usually self-employed and works as an independent contractor. A sales agent may have multiple clients that they represent.

There are also differences in how you pay a sales agent versus how a sales rep is normally paid.

A sales agent earns a percentage of what they sell, or a commission based on sales. The sales agent works directly with a buyer, doing their best to negotiate the best possible contract for the highest amount of money they can get. It is in the best interest of the sales agent to get the highest amount possible because the sales agent's pay is directly related to how much they sell for the client.

A sales rep works for the company and acts for the benefit of the company. The sales rep is responsible for building the business by selling the employer's products or services to other companies or individuals.  The sales rep is usually paid a base salary and a commission or incentive based on how many sales they make.

There are also some differences in how the sales rep does business as compared to how the sales agent does business.

The sales rep will conduct business from an office on the property of the company that they represent. By being on site, they will always have direct access to other members of the management team and will often be involved in decisions regarding promotions and marketing. A sales rep can really work in almost any type of venue. From retail sales to phone sales to working in the field, the sales rep is company based. The income of the sales rep may be limited unless they are on a straight commission basis.

By contrast, the sales agent will work in the field. Because sales agents work as freelancers, they are not limited to the confines of the company property. Sales agents will be out in the field representing you and other clients. Their income is only limited by how much they sell.  The more the sales agent sells, the more they make. 

Whether you choose to go with a sales agent or a sales rep will depend on how you want your company represented. It will also depend on what you consider to be the best venue to sell your product or service.

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