Molto spesso l’accordo con un distributore è considerata l’opzione più semplice ed immediata per vendere i propri prodotti nel mercato USA.
E’ importante analizzare molto attentamente tutte le condizioni e implicazioni che accordi di questo tipo comportano, per valutarne i benefici e confrontarli con le altre opzioni percorribili per iniziare a vendere negli Stati Uniti d’America, come, ad esempio, la costituzione diretta di una propria filiale.
Abbiamo provato a sintetizzarli in questo articolo, sulla base della nostra esperienza con aziende italiane nel settore della meccanica e dei beni industriali.
Agreement with a distributor (in lieu of a branch/office in the US)
A distributor is asked to keep an inventory and the foreign company usually owes this inventory in consignment, temporary exportation.
- Other possible conditions: final sale with long payment terms, special discounts, percentage on sales to direct customers of the exporter, etc.
- Need to define a very specific detailed agreement with distributor according to US laws.
- There are many possibility of misunderstandings, grey area or malpractice by the distributor.
- The distributor has to keep track of inventory and the same paperwork has to be kept by the foreign company.
- There must be a quarterly physical check to be sure that there are no errors.
- Distributors tend to use that inventory as his own and mixes up products.
- Sometimes delivering errors occur to the distributor or from the distributor to the final customer
- Mistakes are often intended to delay payment as much as possible
- Transfer of property –timing, responsibilities etc… – could be a grey area.
- Discussions are possible on defective products, distributor on house repairs, repacking etc…
- Distributors knows final customers and prices. If they are not ‘sole distributors’, they know the full price policy of the exporter toward the entire market.
- Exporters do not have a full knowledge of the market, information is filtered and often unclear, sometime to get advantages.
- A distributor holds a strong position in front of the exporter because of its knowledge of the company matters and market, physical possession of the inventory, local and federal laws not always fully transparent to the exporter resulting in loss of property, collection laws suits very difficult to win, financial damages.
- The lack of an US legal entity is problematic:
- who is issuing the invoice if there is not a company in the US?
- Who is entitled to the payment?
- What are the payment terms and what kind of control does the foreign company have?
- How is the inventory being managed?
- Who is handling the logistics of this and how?
- Who is checking the quality of stock inventory and spare parts?
- Who is responsible in terms of mistakes and part numbers, etc…?
- A distributor tends to monopolize the local relationship with its customers.
It is often not open to transferring information about products destinations, comment from the customers especially when positive, problems or disadvantages he has in the market affecting performances.
- When he has to deliver to dealers outside his normal circuit or area, he tends to incorporate these dealers into his area of influence.
- It is difficult for the distributor and its sales force to be completely open with the manufacturer. They will always try to keep prices as low as possible to make their job easier and maximize profits.
- The exporter does not have full control of its marketing mix.
- The image of the exporter in front of Customers, Reps and Dealer is unclear. and difficult to change in the future
- In case of problems – arising very frequently following this strategy – it will be difficult to make changes and restore a clean organization and company image.
- Exporters will probably need a bank account in the US – In the US it is not usual to make international payments. Normal payment procedure is by check.
This strategy is normally considered as temporary by the Exporter, often intended as a low cost market introduction. Actually, it is not: all things considered, it is often the main reason of market failures. Daily practice brings lots of errors and problems that are time consuming and costly. Often very, very costly.
So, are there any alternative strategies or any amendments to the “distributor” strategy? We’ll be discussing further options in our next posts.