The tail wagging the dog

On our fresh produce markets, most of the agencies operating there pay their salespeople on a commission basis.
Issue date : 24 April 2009

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On our fresh produce markets, most of the agencies operating there pay their salespeople on a commission basis. Details might differ from agency to agency, but the bottom line for both parties is turnover. The industry norm for commission to farmers is 7,5% and of that, a percentage goes to the salesperson. Great for motivating staff, but hazardous when allowed to develop to the extent where the salesperson is calling the shots.

It starts with the trust between farmer and salesperson. Over many years, this relationship can become rock-solid and the farmer’s loyalty lies with the salesperson, no matter where he operates. This gives the latter tremendous power over the market agency, which is effectively relegated to provide an administration service in support of the salesperson. On bigger markets, one salesperson can be responsible for many millions of rand in turnover.

But what happens when greed and arrogance set in and our “superstar” becomes a law unto himself? When he’s in such a commanding position that the agency is treading on glass not to lose him. Poaching staff is almost a national sport amongst market agencies and has been at the root of many confrontations. It also contributes to the poor image market agents have amongst the agricultural community.
There is a statutory body, the Agricultural Produce Agents Council (APAC), charged with administering the Agricultural Produce Agents Act 12 of 1992 on behalf of the agriculture minister. The APAC is required to “maintain and promote the standard of conduct of agents in general”. But this is not so easy.

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We often read in the press about a serious criminal getting away with a seemingly mild sentence on some technicality. It seems to be the same with Act 12. What happens when a salesperson swears at customers, insults them and others and generally causes mayhem? What do you do when warnings from management mean nothing to him and clients complain? You fire him, right? But the APAC can’t revoke his license because the Act doesn’t cover all the loopholes. Besides, they need a formal, written complaint before they can do anything.

Secondly, the salesperson can simply “cross the floor” to another agency whose scruples are more flexible. Thirdly, agency one loses huge turnover and agency two is smiling all the way to the bank. So the bad apples continue to do what they want because the chances of prosecution are slim. Meanwhile, the industry’s name sinks deeper into the mud with farmers and buyers, and the animosity amongst market agencies is cranked up. Fresh produce market agents need to address this urgently or they may not be around for much longer to do so. – Mike Cordes (e-mail [email protected]).     |fw