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Importer, distributor or agent: which partner does your product actually need?

Writer: The MAK Group
The MAK Group
Nov 3
3 min read

Importers and distributors buy your product and resell it, so they carry the stock, the credit risk and most of the local work, and in return they set their own margin on resale. An agent never owns the goods. An agent finds the buyers and earns a commission, while you keep control of price, brand and customer, along with the risk of getting paid. The right choice usually comes down to your product, how well you know the market, and how much control you want to keep.


The importer


An importer buys from a foreign supplier at its own cost and risk and earns its margin on resale. An importer that sells on to other businesses is, in practice, acting as a distributor, which is why the two roles so often overlap. In our experience, a well-chosen importer is often the quickest way for a foreign brand to reach the trade in a new country.


The distributor


A distributor also buys your product and resells it, usually within a defined territory, and takes care of the importing details, customs, duties, warehousing and delivery. It also carries the credit risk for its own customers, which spares you chasing payment from many buyers in a market you are still learning. The trade-off is control, because once the goods are theirs, the resale price and much of the marketing are theirs too. In practice the line between importer and distributor is thin, and the same firm often plays both roles.


The agent


An agent sells on your behalf and never takes ownership of the goods. Buyers order from you, you ship to them, and the agent is paid a commission, typically once you have received payment. You keep control of pricing, branding and the customer relationship. You also keep the shipping costs and the credit risk, since an agent does not normally vouch for a buyer's ability to pay.


Product & Market


It usually pays to start from the product. Goods with a high unit price that call for installation or training tend to suit an agent, because every sale is a conversation and you will want to stay close to the customer. Goods that need local stock and quick delivery tend to suit a distributor, who holds inventory in the market and handles customs and duties.


The market matters just as much. If you are entering a country you know little about, a distributor carries much of the early sales effort while you learn. If you already know the buyers and want to keep direct control of the market, an agent may be the better fit. Local rules can also decide for you, since in some countries a foreign company needs a licence before it may distribute goods itself, which makes a local partner the practical route.


Exclusivity


Whichever partner you choose, the agreement deserves as much care as the choice. An exclusive arrangement gives one partner the whole territory, which most intermediaries prefer since it keeps competitors out, and it is best paired with clear targets and a termination clause, so a quiet partner cannot hold a market closed for years. A non-exclusive arrangement keeps the door open to others.


Our role


That is where we come in. We find, vet and introduce the importers, distributors and agents that fit your product, help you shape the agreement, and stay close while the first orders move. In the spirit of straight talk, if a market calls for a different route than the one you had in mind, we will tell you. Let's talk about your project.


FAQ


What is the difference between an importer and a distributor?


Both buy your product and resell it. An importer is defined by bringing the goods into the country and often sells on to other businesses, while a distributor resells within a territory and usually handles warehousing and delivery. The same firm often plays both roles.


How is an export agent paid?


By commission on the sales they negotiate, usually paid once you have been paid by the customer.


Who carries the credit risk?


With an importer or a distributor, they do, for their own customers. With an agent, you do, because the buyer pays you directly.


Can I start with an agent and move to a distributor later?


It can make sense. As volumes grow and local stock becomes worthwhile, a distributor may serve you better, and it helps to plan for that possibility in the first agreement so the change is smooth for everyone.


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