How do you manage international distribution?

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Entering the global economy with your product is easier than ever today. With the internet at everyone’s fingertips, your marketplace can be accessed by the world. Of course, there are export laws and distribution methods to learn, but right now the opportunities are vast. There are different ways to enter international markets including setting it up through international departments or working with distributors. Although the internet proves efficacious for many, it’s good to look at the options and decide which one best suits your company.

Set up an international department

When you set up an international department, this provides a direct channel that your company can use to enter another country’s market. This can be advantageous because it gives you full control over what’s going on in this international setting. However, you must be culturally sensitive and aware of the customs and culture of the new country you’re operating in. You may need to provide work visas, set up different payroll systems and provide different remuneration if the cost of living is different.

If you were to move to a new city with your family, there is an adjustment period. You might start a job with new colleagues, you will need a new place to live and have to find new schools if you have children. A move like this takes a lot of adapting and adjusting. A company must also expect adjustment. Moreover, the adjustment period might be longer as a different country brings a lot of challenges and new experiences. If there are language barriers, this will add another layer of complexity. An international department can work well, but expect to compromise on certain ways of operating and know that it will take a while to settle in.

Using a distributor

If shifting personnel and setting up an international department isn’t for you, then do a bit more research into working with a distributor. Essentially, you can leverage the expertise of export management companies to distribute your product in overseas countries. They have specialised consultants that know the ins and outs of overseas markets. They have streamlined procedures to manage shipping, importing and getting your product onto the shelves in foreign markets. Export management companies can help predict the ordering cost of the product and they will calculate necessary taxes and gauge market prices. They can also help negotiate the ordering cost of shipments and stockist prices as well.

Online distribution

The export industry has changed shape with the internet. Where previously export information was held by export management companies and consultants now it is easily accessible. This means the internet has opened export opportunities for more people. However, with the internet, there is a higher risk of fraud from overseas companies and landing pages trying to trick you or take your money. This makes it extremely important to vet a website by checking references and contacting people on the other end before agreeing to export.

Effectively, the internet can take the place of the sales function. It allows buyers from the internet to place orders and the product’s overall ordering cost can be paid through an e-commerce platform or wallet.

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Melanie - Unleashed Software

Article by Melanie Chan in collaboration with our team of Unleashed Software inventory and business specialists. Melanie has been writing about inventory management for the past three years. When not writing about inventory management, you can find her eating her way through Auckland.

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