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Reaching Overseas Markets - A Low Cost Option

 
Date: November 19, 2010 Author: Dr. Amit K Chatterjee

Every business wants to increase sales, reach new customers, expand market share. The key to growing sales is not merely reaching new customers all on your own, but also to spread your product information (i.e promotion) in such a way that customers, hitherto unknown, get to know about your product and contact you on their own.

While direct marketing is comparatively easy to understand and implement, effective promotion needs creative thinking and innovative application. Successful marketing requires a clever mix of both direct marketing and promotion, ensuring maximum return on investment.

Some of the popular choices of direct marketing are : participation in trade fairs , visiting potential overseas buyers in target markets etc, all of which are rather expensive. In this article, we discuss a low cost option of reaching target markets - commercial representatives, agents and distributors . Contrary to popular belief - appointing representatives, agents and distributors in target markets can be done at zero or minimal cost. However, you need to know what's the best practice and how to locate reliable agents and distributors in Europe and USA. This article discusses when and how to appoint representatives, agents and distributors and lists free sources of information on how to locate reliable agents.

Building Overseas Presence Through Commercial Representative, Agents and Distributors

Commercial Representatives, Agents and Distributors constitute a very effective marketing channel for exporters. Imagine having your own man in overseas markets who, with their understanding of local language, culture and market trend can promote your products to right customer segments. An effective market representative can multiply your sales several times at a very reasonable cost. Besides, having physical presence of your business in target country add to customer comfort level significantly.

Representatives and Agents

These are generally individuals or small firms who do not purchase or maintain an inventory of your products. Their most obvious benefits are knowledge of local language and close proximity to existing and potential customers. They usually solicit orders from potential customers on behalf of the exporter (also called principal) and their compensation is a commission from the net export ex factory price or agreed fee. Orders are placed on behalf of the buyer, the agent usually does not get involved in shipping/ delivery.

Distributors

Also called dealer, wholesaler or stockist, is a larger firm than commercial representative or agent. They have the product knowledge, qualified personnel, local sales network, physical facilities and financial resources to perform all of your export marketing functions. They are equipped to advertise, promote, order, purchase, transport, stock, deliver, finance and repair you products.

Distributors differ from agents in their ability to maintain a continuous inventory of products and spare parts for prompt delivery and reliable customer service. Distributors are compensated in the form of discount from gross export ex factory price and may enjoy other facilities like credit, promotion support etc.

Appoint Commercial Agent If:
  • It is an accepted distribution method in the country you are exporting to
  • You are unwilling to spend more or looking for an initial low-cost option to enter the target market
  • You do not need to maintain inventory in that country. For example, if you manufacture custom products, capital equipment, branded consumer products, or can have inventory shipped directly for individual orders, you probably do not need to keep stock and maintain a distributorship program in the country to which you are exporting
  • You want to maintain direct control of the sales of your products overseas. Since agents sell the product on behalf of the exporter, they must sell it at the exporter's price, under specified conditions and with prescribed representations and
  • You intend to benefit from corporate identity and intend to conduct business under your own name
Appoint Distributor If
  • It is the accepted distribution method in the country you are exporting to
  • You are satisfied that the target country is important for your marketing plan
  • You need to maintain inventory in the foreign country
  • You do not wish to invest in your own distribution network
  • Your corporate brand identity in the country is not essential
Free Information on Commercial Representatives, Agents and Distributors
There are business directories and web-sites on commercial agents and distributors. Most of these sources charge a fee for information. Besides, one does not know reliability of such paid information.

Perhaps a much better source of information is official association of agents and distributors in target countries. Information from such sources is far more reliable than directory listings as associations have membership criteria and a mechanism to enforce it. Besides, you have someone to fall back upon in case background information about a member is required.

Following is a list of Official Associations of Commercial Agents and Distributors

 AUSTRIA
Add: Bundesgremium der Handelsagenten
Wiedner Hauptstrasse 63
A-1045 Vienna
Tel: 0043 5 90 900 -3200
Fax: 0043 5 90 900 – 287
Email: handel5@wko.at
Home: http://www.commercial-agent.at
 
 BELGIUM
Add: (UBAC) Union Belge des Agents Commerciaux (UBAC)
167 Boulevard Guilaume
1190 BRUXELLES, Belgium
Tel: 0032 23444545
Fax: 0032 23430243
Email: ubac@skynet.be
Home: http://www.iucab.org/
 CYPRUS
Add: Cyprus Commercial Representatives Association (CCRA), P.O. Box 21455, 1509 NICOSIA
Tel: 00357 22 889890
Fax: 00357 22 667593
Email: seak@seak.org.cy
Home: http://www.iucab.org/
 
 DENMARK
Add: Dansk Erhverv - The Danish Chamber of Commerce
Mr. Sven Petersen, Borsen
DK-1217 COPENHAGEN-K
Tel: 0045 3374 6000
Fax: 0045 3374 6080
Email: svp@danskerhverv.com
Home: http://www.danskerhverv.com
 FINLAND
Add: Finnish Foreign Trade Agents' Federation (FFTAF)
Etelaesplanadi 18
00130 HELSINKI
Tel: 00358 986831650
Fax: 00358 986831651
Email: fftaf@agenttiliitto.fi
Home: http://www.agenttiliitto.fi
 
 FRANCE
Add: Association Professionnelle des Agents Commerciaux (APAC)
71, rue Pierre Corneille 69006 Lyon
Tel: + 33478526175
Fax: + 33478526174
Email: info@apacfrance.com
Home: http://www.apacfrance.com
 FRANCE
Add: Fédération Nationale des Agents Commerciaux (FNAC)
30, Avenue de l'Opéra
75002 PARIS
Tel: 0033 144940500
Fax: 0033 144940510
Email: fnac@comagent.com
Home: http://www.comagent.com
 
 GERMANY
Add: Centralvereinigung Deutscher Wirtschaftsverbände für Handelsvermittlung und Vertrieb (CDH)
Am Weidendamm 1A
10117 BERLIN
Tel: 0049 30 72625-600
Fax: 0049 30 72625-699
Email: centralvereinigung@cdh.de
Home: http://www.cdh.de
 GREECE
Add: Federation of Independent Commercial Agents Association (FICAA)
President: Mr. D. Karmalakos
3, Karitsi
GR-10561 Athens GREECE
Tel: +30 210 3311871
Fax: +30 210 3311870
Email: osaea@otenet.gr
 
 GREECE
Add: Federation of Independent Commercial Agents Association (FICAA), President: Mr. D. Karmalakos
3, Karitsi
GR-10561 Athens GREECE
Tel: +30 210 9339090
Fax: +30 210 9345475
Email: alkis@ets-iliadis.gr
 GREAT BRITAIN AND IRELAND
Add: The Manufacturers' Agents' Association (MAA) Unit 16
Thrales End Harpenden Herts AL5 3NS UK
Tel: +44 0 1582 767618
Fax: +44 0 1582 766092
Email: prw@themaa.co.uk
Home: http://www.themaa.co.uk/
 
 ITALY
Add: Unione Sindicati Agenti e Rappresentanti Commercia Italiani Via della Sette Chiesa 144
I-00186 ROMA
Tel: 0039 06 514 35 215
Fax: 0039 06 516 06 147
Email: federusarci@usarci.it
Home: http://www.usarci.it
 ITALY
Add: Federazione Nazionale Ass. Agenti e Rappresentanti di Commercio (FNAARC)
Corso Venezia 51
20121 MILAN
Tel: 00390 27645191
Fax: 00390 276008493
Email: fnaarc@tin.it
Home: http://www.fnaarc.it
 
 LITHUANIA
Add: Lithuanian association of commercial agents
P.O. Box 3464
LT03014 Vilnius
Lituania
Tel: +37 0 686 261 02
Fax: +37 0 620 298 76
Email: info@exportera.lt
 THE NETHERLANDS
Add: Verbond van Nederlandse Tussenpersonen (VNT)
Postbus 74773
1070 BT AMSTERDAM
Tel: 0031 203057732
Fax: 0031 206710974
Email: info@vnt.org
Home: http://www.vnt.org
 
 NORWAY
Add: Federation of Commercial and Service Enterprises Section for Commercial Agents
P.O. Box 2900 Solli
N-0230 OSLO
Tel: +47 22 54 17 00
Fax: + 47 22 56 17 00
Email: hrf@hsh-org.no
Home: http://www.agentforeningen.com
 SPAIN
Add: Col-legi Oficial d'Agents Comercials de Barcelona (COACB) Casp, 130
08013 BARCELONA
Tel: +34 9323194 12
Fax: +34 932455746
Email: coacb@coacb.com
Home: http://www.consellcat.org/ca/index.html
 
 SWEDEN
Add: (SAA) The Swedish Association of Agents
Box 3146
SE 103 62 STOCKHOLM
Tel: 0046 84110022
Fax: 0046 84110023
Email: mail@agenturforetagen.se
Home: http://www.agenturforetagen.se/
 SWITZERLAND
Add: Verband Kaufmännischer Agenten der Schweiz
Association Suisse des Agents-Représentants
Associazione Svizzera degli Agenti Rappresentanti
Swiss Commercial Agents’ Association
Ackersteinstr. 164, CH-8049 Zurich
Tel: 0041 44 340 18 88 / 0041 44 340 64 80
Fax: 0041 44 341 78 94
Email: info@vka.ch
Home: http://www.vka.ch
 
 U.S.A.
Add: Manufacturers' Agents National Association (MANA) Mr. B. Shirley, CPMR President/CEO 16 A Journey, Ste. 200 Aliso Viejo CA 9263056-3317 USA
Tel: 001 949 8594040
Fax: 001 949 8552973
Email: MANA@MANAonline.org
Home: http://www.MANAonline.org/
 
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Blog Categories : Agency / Distribution / Rep. Services
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Blog Sector : Foreign Trade
 
 
 
 
 
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