As an exporter or manufacturer who is keen to step into international market, you should better initiate in a secure and planned manner for export import trade. One fairly safe and secure way is to establish indirect exports and see the response. There are various ways to begin indirect exports, but the most commonly used technique is to get into a contract with some distributor or hire the services of commission agents. Although, their functions may sound a bit similar, both of them differ at some points. Let’s look into the work aspect of these two in detail.
Commonly recognized as commission agents, they are accountable for selling your items in overseas market. They are skilled campaigners and quite familiar with the bazaar you are going to target. They are familiar with the customers and their requirements. However, the thing to keep in mind is that they are only responsible for selling your items. They do not purchase from you directly; neither do they engage themselves in delivery or after sale services in most cases. Their source of earning is the preset commission on each sale.
Essential requirements for Commission Agents before you hire them
* Should be having loads of knowledge in the field.
* Confirm if the agent also deals in some of your competitive items.
* Examine precedent record of sales and the stats for business they have offered to other exporters in the past.
* At what extent and how much of the market that export agent can cover.
* Do they trade to end users or businesses?
Different form commission agents, export distributors usually purchase the items from you (at economic price) and then put it up for sale in the bazaar, all the time maintaining some inventory with them. They also provide after sale services; they are more convenient if your goods require some installation work or needs after sale services.
Essential requirements for Export Distributors before you hire them
* Distributors should be monetarily sound.
* They must be good in warehouse management and inventory stocking.
* Should be ready to work at cost margins you are willing to offer.
* Should be having deep technical information about the items you are dealing in.
* Be very cautious when going into a deal and think over the sections several times before signing.
* Export distributor should be capable of running or managing the marketing campaign if required.
Now, whether you should go for distributors or agents? The answer to this question will vary on your items and preferences.