Selling through an overseas agent is an effective strategy. These agents serve as a source of market intelligence. Regularly sending the latest trends on the current fashion, taste and price in the market. Being a man on the spot, the agent is in a position to render his advice to exporter or new methods and strategy for pushing up sales of your products. He also provides you support in the matter of transportation, reservation of accommodation, appointment with the government as and when required by you. In some countries it is compulsory under their law to sell through local agents only. It is, therefore, essential that you should carefully select your overseas agent.

Important Points While Appointing a Sales Agent:

Appointing right sales agent not only enhance the profit of an exporter but also avoid any of risks associated with a sales agent. So it becomes important for an exporter to take into consideration following important points before selection an appropriate sales agent for his product.

1. Size of the agent's company.
2. Date of foundation of the agent's company.
3. Company's ownership and control.
4. Company's capital, funds, available and liabilities.
5. Name, age and experience of the company's senior executives.
6. Oher agencies that the company holds, including those of competing products and turn-over of each.
7. Length of company's association with other principal.
8. New agencies that the company obtained or lost during the past year.
9. Company's total annual sales and the trends in its sales in recent years.
10. Company's sales coverage, overall and by area.
11. Number of sales calls per month and per salesman by company staff.
12. Any major obstacles expected in the company's sales growth.
13. Agent's capability to provide sales promotion and advertising services
14. Agent's transport facilities and warehousing capacity.
15. Agent's rate of commission; payment terms required.
16. References on the agents from banks, trade associations and major buyers.

Agent v Distributor

There is a fundamental legal difference between agents and distributors and an exporter should not confuse between the two. An agent negotiates on the behalf of an exporter and may be entitled to create a legal relationship between exporter and the importer
A distributor buys goods on its own account from exporter and resells those products to customers. It is the distributor which has the sale contract with the customer not the exporter. In the case of distributor, an exporter is free from any kinds of risks associated with the finance.