Approaching a Foreign Company For Importing
Ensure you have the right game plan before making contact.
How do you approach a manufacturer in another country to let you import it to yours? Priority No. 1 is to select a product that is successful in its present domestic operation and has the look and feel of export potential (meaning everybody, everywhere —already loves it and is likely to continue doing so even in the United States). Priority No. 2 is to go to market with what you are familiar with. Priority No. 3 is to view the potential of the product in front of you through the eyes of consumers in your import market of choice, in this instance, the United States.
That said, let’s say the manufacturer you are interested in makes more than 12 different styles of shoelaces. Which one should you import? Easy. The one that sells like hotcakes in his market. The one you love the best. The one you know that customers in the United States will love the best. Try to choose one item that you can come close to providing an affirmative response for in regard to all of those statements!
Next, script your communication to the manufacturer. You might want to also review Finding a Supplier for the Product You Want to Import.
Lastly, nothing beats a face-to-face encountering when you want to seal a deal on representation.
Once you have gathered information on your prospective supplier’s product and reviewed the product for import readiness, you must convince the manufacturer that you are capable of importing the company’s shoelaces to your part of the world. How do you go about it?
It goes like this: focus, explain, emphasize and stroke.
- Focus on the target market. Give the manufacturer an introduction to the market conditions in an unknown country. This will intrigue him.
- Explain how you do all the work and incur all the risks.
- Emphasize that he will make most of the money from the transaction.
- Stroke him by enumerating the benefits you can bring to his business by exploring other markets on his behalf.
Your goal is to get the manufacturer excited about the possibilities and to convince him that you’ve got the expertise to pull it off. It’s best to be prepared for a range of possible responses. Your follow-up exchange might go like this:
Importer: “Do you sell to the United States?”
Manufacturer: “Not yet.”
Importer: “Well, I think it’s a good market for your shoelaces – rich in upside potential! I’m in touch with several agents and distributors here who are looking for your type of shoelaces, and that means fast, hassle-free additional business for you!”
Manufacturer: “Sounds great! How do we get started?”
In this instance, you’re breaking totally new ground for him, so you can offer him your strategy as to how to get started. But you might find yourself dealing with a manufacturer who already has some international operations in place. If you want to get in on that action, you must convince the person you’re dealing with that you are flexible, cooperative and interested primarily in generating additional business for him. Here’s how you might work such a situation to your advantage:
Importer: “I have contacts in the United States. May I offer your products there?
Manufacturer: “We already do business there.”
Importer: “On an exclusive basis?”
Manufacturer: “No, but we are open to expanding our business there.”
Importer: “I sell through importing distributors who service the discount chain stores. Does that differ from your present customer base?”
Manufacturer: “Yes. Right now we sell only to small mom-and-pop retail outlets that are serviced by a local trading company.”
Importer: “If I generate reasonable business within a few months, will you allow me exclusivity in United States on all discount chain store business?”
Manufacturer: “If I see you generate the sales, I’ll have no problem giving you exclusivity.”
Importer: “Fair enough! I am confident that I can generate the sales you’ll want to see in six months. At that point, if it is acceptable to you, I would like to meet with you to work up an agreement protecting my efforts.”
Manufacturer: “Fine. In the meantime, let’s get some idea of what you need to get started.”
That’s all there is to it. Now that you have gone to the trouble of finding a product to import, shoelaces, and proving to a manufacturer you can import it, it’s time to consider whether you need a written agreement as to how you will do business with the company. We’ll discuss that in a future article.