How Strong Is Your Agency in Today’s Environment?

We talk with agency owners every day and the vast majority of the direct selling agencies in the space continue to report solid business results as they help their clients migrate to the new norm of remote enablement. A common concern, however, is the ongoing security of their existing bases of customers. What will happen to commission streams as the pandemic stretches into the last half of 2020 and possibly beyond?

Will your providers continue to pay you commissions? Will your clients continue to pay their technology bills? Will your clients’ clients continue to pay them for the products and services they offer? Will your clients’, clients’, clients continue to pay . . . ?

No one’s crystal ball is very clear, but as we approach mid-year, the wise agency owner is taking the time to evaluate the security of their future revenue stream. Ask yourself these questions:

What is the stratification of your customer base?
- What percentage of your base is small business, medium business, mid-market and enterprise?
- Is there a concentration of industry segments among your clients?

Does your billing base consist primarily of legacy telco products or does it skew more toward cloud services?
What is the collections experience of your primary providers?
- How are their 60-day and 90-day receivables buckets trending?
What are they projecting for attrition?

Some frightening statistics that are commonly cited are that 20% of all small business could fail, 15,000 retail stores could permanently close, 1 in 5 restaurants could go out of business and entire industry segments could collapse.

Do you know how exposed your revenue is to these possibilities? What will you do if you if you lose 10%, 20% or even 30% of your revenue?

You may be flooded with new opportunities that could offset the potential attrition you might experience, but do you know? Have you done your homework to rest comfortably at night, knowing that you have contingency plans in place?