Wednesday, August 21, 2013
Selecting a Sales Rep Abroad
This blog deals in what to look for when you identify a rep after short listing the candidates. Future blogs will discuss how that short list can be assembled. Reps get paid a comm. They expect a territory exclusive. Caution is the watchword.
1 What other products does the rep handle? It is almost impossible to know the true answer. IF the rep already works with similar products to your own, it is a sure sign the rep already has contacts in your appropriate trade. That's good. Most reps have many product lines they represent. They may have competitive lines to yours. The best you can hope for is compatibility between you and the rest of his stable. Ex: Toothpaste & your toothbrushes. Obtain full info and pursue due diligence with the reps other product lines.
2 Which line does the largest volume? Yours may be a perfect fit, but will not generate a lot of attention. Care here as the rep may do nothing with yours just to keep it out of his terr. Or, take the line to satisfy a single specific buyer and not bother to expand distribution.
3 Due diligence. The int'l. trade community freely shares info. Even competitors give info on credit, payment habits, organizational terr., etc. Don't be bashful to ask.
4 What is reps financial situation? The rep is YOU in the terr. You should insist on who is their banker. Your banker can obtain all info for you. Poor financial condition can cause losses due to marginal sales made without any regard to customers' payment ability. Adequate rep funding will allow the rep to make with the long view rather than accept immediate deals.
5 Establish a minimum annual sales quota. They will try to weasel out of this. However this is a benchmark that will allow you to extricate yourself from the relationship if that figure is not met. A legal basis for separating is always complex as foreign rules are so complicated. But with an annual quota that allows year-to-year negotiated agreements, overcomes the rigidity of the initial length of the relationship. e-mail me if you need one-on-one support in doing business overseas: firstname.lastname@example.org
Certified SCORE counselor
SCORE Chapter 412
Boca Raton, So. FL