Setting yourself up overseas

Once you have a product that you feel has potential in an overseas market you will have to find a buyer, distributor or agent for your product overseas.
There are differences in working with an agent or a distributor or going direct to an end user for your product. Strategically it is very important you determine right at the start what your options are and decide what is best for your business. It’s important to do your groundwork in advance.
Seek out your trading partner’s history or credentials
 Get references and find out the agent/buyer’s experience in the industry.
 Establish if they want or need to expand their business and if their strategies for growth are similar to what you need. Are they likely to work at a pace that suits your business needs?
 Find out who their competitors are.
It is important to have a good idea of the financial strength of your potential customer or agent, not only because of a capacity to pay criteria, but also in the event they enter into heavy competition in the marketplace with a competitor.
 Strengthening your position in the market
 It is useful to discover what channels of distribution your buyer operates in, e.g. wholesale, retail and if retail what type of store, e.g. Supermarket or health stores. This will help you assess what is going to be the most beneficial for you and also enables you to understand more closely who potentially could become your competitors.
 Look carefully at your buyer’s commitment to their business and their support for you. Do you have a mutual interest in the market they/you operate in?
 What can they tell you about any competitor’s products? This is likely to give you an understanding of their knowledge of the market.
 Trading terms and guarantees
You must negotiate clear trading terms, the arrangement of credit or payments and what guarantees are available on their performance. You need to know what their financial strength is.
 Financial reports if a public company, other creditors.
 Secure references from other principals if necessary.
Product specifications and product guarantees are always a must for an importer. Therefore, an importer overseas will want to spell out clearly before they buy a new product, what the specifications are, and put them in writing. This process protects everyone also from unfair claims.
Part of the specifications need to cover packaging. This is important because it can be a source of contention if something gets damaged in transit or while being delivered overseas.
It is important to spell out what is the exporter’s responsibility and what becomes the buyer’s responsibility as an importer/distributor.