A small manufacturer with a global marketing presence: trade show, web site, YouTubeube, white paper, testimonial may sometimes get product requests from outside the USA. This is a compliment to your marketing department. How do you respond when a lead requests to sell your line of products in another market? Does the benefit of increased sales outweigh the risk of non-payment? Loss of end customer control? Possible trademark or product liability issues that may result?
You usually need more information to make this decision. Most exporters would send back a quick request for more information or distributor application to better qualify a distributor as a business partner. Remember distributors are not customers-they are part of the supply chain to get to the end user. The purpose of the application is to screen and qualify potential distributor candidates. I have built past distributor applications to determine does this channel have similar traits to other successful distributors (home or abroad) that have a proven history. Any distributor who does not complete the application is clearly not willing to devote significant efforts to win more market share for your products.
I would typically collect this information from any potential distributor and attempt to follow up with them in the future. It is always good to have back up distributor source or one with an alternative path to market. It also helps you to balance or validate market/competitive situation you hear from your
primary source of information. I had a larger growing distributor in Turkey file for bankruptcy during the summer of 2011 and was suddenly without a two step path to market for important customers. Thank goodness I had met with Mr. Dogan several times since 2008 and was able to transition our business smoothly. As one of my mentors once told me-Jim, you never want to double park your car outside the bank late on a Friday afternoon to cold call a commercial lender. Build those relationships before you need them.
What are typical elements of the application?
1. Contact information
2. Organization chart
3. Complementary product lines and suppliers
4. Competitive product lines
5. Local marketing programs
6. Inventory requirements
7. Import license, experience and capabilities
8. Credit and banking contacts
9. Sales coverage and statistics
10. Geographic focus
If you need assistance to build your initial distributor application I can help develop one for you. It is a fairly easy task and a good business process to have in place.