Foreign Distributors
Foreign / International Distributors
International Business Networking Seminar
Kevin Hanske - 3104007
Angga Surya Pradana - 3104008
INTERNATIONAL BUSINESS NETWORKING PROGRAM - “Y” CLASS
UNIVERSITY OF SURABAYA - FACULTY OF BUSINESS & ECONOMICS
2013
Foreign Distributors
When selling products in foreign markets, a firms should maintain relationships with local distributors over the long term even after establishing their own local network to handle major clients. In theory, local distributors provide knowledge about the local market, knowledge of local regulations and business practices, existing major customers at low cost, and the ability to hire appropriate staff and develop relationships with potential new customers. Based on David Arnold's observation about foreign distribution, he observes that many organization establish relationship with local distributors in the host country in order to reduce costs and minimizing the risk. This is happened because local distributors tends to have knowledge about local regulations, business practices, ability to hire appropriate staffs and has relations with potential customers that the organization needs when want to enter their products to host country market that for the organization the condition of host country market is still uncertain.
Foreign distribution channels
All products whether they be consumers goods, industrial goods, or services require a channel distribution. Channel distribution can vary from direct to multi level channels that serves particular purposes. For example, goods that distribute from the producer to consumer is considered ad direct channel or direct sales and produces to agent or distributors to consumer are considered as indirect channel or indirect sales.
There are five alternatives types of consumer channels which are producer-consumer, producer-retailer-consumer, producer-wholesaler-retailer-consumer, producer-agent/distributors-retailer-consumer, and
International Business Networking Seminar
Kevin Hanske - 3104007
Angga Surya Pradana - 3104008
INTERNATIONAL BUSINESS NETWORKING PROGRAM - “Y” CLASS
UNIVERSITY OF SURABAYA - FACULTY OF BUSINESS & ECONOMICS
2013
Foreign Distributors
When selling products in foreign markets, a firms should maintain relationships with local distributors over the long term even after establishing their own local network to handle major clients. In theory, local distributors provide knowledge about the local market, knowledge of local regulations and business practices, existing major customers at low cost, and the ability to hire appropriate staff and develop relationships with potential new customers. Based on David Arnold's observation about foreign distribution, he observes that many organization establish relationship with local distributors in the host country in order to reduce costs and minimizing the risk. This is happened because local distributors tends to have knowledge about local regulations, business practices, ability to hire appropriate staffs and has relations with potential customers that the organization needs when want to enter their products to host country market that for the organization the condition of host country market is still uncertain.
Foreign distribution channels
All products whether they be consumers goods, industrial goods, or services require a channel distribution. Channel distribution can vary from direct to multi level channels that serves particular purposes. For example, goods that distribute from the producer to consumer is considered ad direct channel or direct sales and produces to agent or distributors to consumer are considered as indirect channel or indirect sales.
There are five alternatives types of consumer channels which are producer-consumer, producer-retailer-consumer, producer-wholesaler-retailer-consumer, producer-agent/distributors-retailer-consumer, and