Finding the agents or distributors for each market is crucial. You need good overseas business partners to generate sales. Agent/distributor selection is especially important. A poor sales rep. could seriously hamper you in good markets. Therefore, you want to choose carefully.
Here are techniques for finding "interested buyers" and "qualified agents and distributors".
You can't assume that the buyers will find you. You need to search for your own leads.
The best leads are the “first-hand leads” you uncover on
foreign business trips or that your overseas reps. find for you. These
leads are also more costly to develop.
If you don't have overseas reps. or can't afford overseas sales
trips, give the "second-hand" leads a try. Second hand leads, are those
you find out about by reading on the internet, though magazines etc.
They're often very good leads too. However, since your competitors can
learn about them too, you MUST follow up quickly on these leads.
Some of the best leads are for “development projects” still in the planning stage. These future projects offer opportunities for equipment, supplies and services of all kinds. They often have government support and financing.
Finding and keeping good overseas reps. is a four-step process:
First impressions count, so what you say first is very important.
The initial message should convey:
You should respond promptly to all serious responses, try to answer
all questions as fully as possible, and provide product information
etc. Do use discretion in sending costly product samples, especially if
they could be easily copied. Product samples should be reserved for the
The key is to know what you want in a rep. You should identify the
qualifications needed for effective representation. The requirements
may vary by product, but five basic qualities are fundamental:
Experience: a rep
with a solid track record as an agent or distributor; expertise in the
product area; and strong connections in the user community.
Capability: a rep
who can market and support the products in the way required (e.g.,
promote the product, train users, install and service equipment)
Motivation: a rep who is enthusiastic about the product and able and willing to give it priority
Loyalty: a rep who would not desert you for a competitor or represent a firm with a competing product
Honesty: a rep with a good reputation in the industry and good bank and trade references
When finding your rep. make sure you know the following background information on each prospect:
Don't hesitate to ask prospects for this information. They'll
respond if they want your business. Of course, don't go by what they
say alone. A face-to-face meeting with top prospects is also wise at
some point, preferably at their premises for a first-hand evaluation.
Once you've identified the best prospects, you should formalize the
appointment with an “agent/distributor agreement”. These
agreements clearly specify the terms of the relationship and the
responsibilities of each party.
The “agent/distributor agreement” should cover the following:
These points are negotiable. Aim for a mutually beneficial agreement that motivates the rep and protects your interests.
The rep will also ask you to respond promptly to orders, deliver the product on time, pay the agreed commission, provide training or other specified support, and pay a fair share of any joint marketing and promotion expenses.
These are reasonable conditions. In turn, you should seek the following commitments from the rep:
Please Note: It's also very important to have an “escape clause” in the agreement. You need the flexibility to change your rep. if the rep doesn't perform as agreed.
Most agreements specify a specified duration (usually one year),
with automatic annual renewal, unless either party opts to terminate.
Typically, advance notice is required for termination (e.g., 30, 60 or
However, some countries limit termination rights in order to protect local businesses. Without an enforceable termination clause, you might have to retain a poor performer longer than you want, or pay a high fee to end your relationship with your rep.
You should consult an internationally experienced attorney before signing any agent/distributor agreement.
Good reps need your co-operation and support as much as you need
theirs. Treat them as you would your domestic sales force. Prices,
terms and commissions should be reasonable. At the least, you should:
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