5 Tips to Help Exporters Choose the Right International Distributors

When I started my career in international business, I thought that only large companies could be successful exporters. However, after establishing successful international distributors in Latin America, Europe, Africa and the Middle East, I realized that companies of any size can succeed.

The insights, strategies and tips I shared in my previous articles are lessons and practices I learned and developed from working as an exporter and consulting for small- and medium-sized enterprises (SMEs) all over the country. People in other countries want products from American companies, and we can bring our products to them through international distributors. 

Throughout this series, I discussed the most important aspects of successfully exporting via distributors. I covered critical how-tos, including:

• Finding the right distributors abroad that will produce results on a long-term basis and figuring out the profile of your ideal distributor.
• Developing and establishing an International Distributor Screening and Selection Process. 
• Developing and using an International Distribution Prospectus.
• Preparing to interview international distribution candidates and negotiate the terms of the International Distribution Agreement.
• Three practices to set up your new international distributors for success.

Choosing Distributors: 5 Final Tips 

Before closing this series, I’d like to highlight five best practices to keep in mind as you add international distributors to your distribution network:

1. Don’t Walk Alone

There is a plethora of agencies and resources ready to walk alongside you and help you in your journey as an exporter. Depending on the state in which you live, your business, your industry and your product, you may qualify to receive assistance from more than one agency, at little or no cost to you. 

These are some of the federal, state and industry export/trade agencies and programs available to assist exporters:

• U.S. Commercial Service: This is the trade promotion arm of the U.S. Department of Commerce’s International Trade Administration. It includes a global network of experienced trade professionals located throughout the United States and in U.S. embassies and consulates worldwide.
• State Trade Agencies: Most states have their own export assistance departments. For example:
  • Minnesota
  • Texas
  • Washington State
• Industry-Specific Agencies: There are industry groups that have departments to assist companies in their export efforts. Here are a couple of examples:
  • Agricultural products, including food and beverage: Food Export and SUSTA
  • Cosmetics: Independent Beauty Association
  • Leather: Leather and Hide Council of America
• The Export Assistance Departments of State Economic Development Corporations/Partnerships: Many states’ EDCs or EDPs have an export assistance component. Here are a couple of examples:
  • North Carolina Economic Development Partnership
  • Wisconsin Economic Development Corporation
• Small Business Development Center (SBDC) International Trade Centers:> Many SBDCs have specialized trade advisors or even full departments focused on export assistance. Contact your local SBDC for more details.
• Small Business Administration (SBA): SBA offers export advising and financing for exporters:
  • State Trade Expansion Program (STEP) Grant: This grant covers costs associated with entering and expanding into international markets.
  • Read more about SBA loans: Government Loans for Your Exporting Business
• Export-Import Bank of the United States: Speaking of financing, EXIM is an independent federal agency that provides trade financing solutions, such as export credit insurance, working capital guarantees and guarantees of commercial loans to foreign buyers.
• Minority Business Development Agency (MBDA) Export Centers: MBDA has four export centers focused on providing export assistance to ethnic minority-owned companies.
• District Export Councils (DEC): DECs are a source of professional advice, counseling and mentoring for their region’s exporters. You can find your DEC here.
• Global Chamber: It has chapters in hundreds of metro areas in the U.S. and abroad, focusing on growing cross-border trade by providing connections and support.

2. Prepare, Prepare, Prepare

In my personal experience, when I’ve seen exporters fail when working with international distributors, it’s not because of the product or the company. It’s because they did not prepare to select the right distributors, train them and/or develop them for long-term success.

3. Be Ready to Walk Away

It is very tempting to sign a new distributor, even if they are not a good match, for the sake of adding more pins to the map. However, it is critical to only sign up those you see yourself working with day in and day out and walk away from distribution candidates that do not feel right or do not seem to be a good match for your company. It is better to walk away than to be stuck with a bad partner.

4. Test Your New Distributors

Many distribution candidates want to lock in long-term distribution rights and ask for five- to ten-year distribution agreements. I highly recommend starting with a two-year agreement that can be renewed for three more years if the candidate achieves his/her distribution goals.

5. Invest in Your Distributors’ Success

Your success as an exporter depends on the success of your distributors. Thus, it is critical to spend time, resources and effort to provide them with the training, tools and encouragement to succeed in the short and long term. Successful exporters don’t simply add a lot of distributors. They add the right distributors that will produce results and be part of their network for the long run.

Selling products abroad through international distributors can prove to be a treasure for your company’s growth. With the right distributors, preparation and motivation, you and your distributors can succeed together and mutually benefit your companies, your employees and your communities.

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