Five Steps in the Process of Building Channels for International Distribution

Topics: Marketing, The Middleman, Distribution Pages: 3 (943 words) Published: October 30, 2008
The search for prospective middlemen should begin with study of the market and determination of criteria for evaluating middlemen servicing that market. The company's broad policy guidelines should be followed, but expect expediency to override policy at times. The checklist of criteria differs according to the type of middlemen being used and the nature of their relationship with the company. Basically, such lists are built around four subject areas: (1) productivity or volume, (2) financial strength, (3) managerial stability and capability, and (4) the nature and reputation of the business. Emphasis is usually placed on either the actual or potential productivity of the middleman. Setting policies and making checklists are easy; the real task is implementing them. The major problems are locating information to aid in the selection and choice of specific middlemen, and discovering middlemen available to handle one's merchandise. Firms seeking overseas representation should compile a list of middlemen from such sources as: (1) the U.S. Department of Commerce; (2) commercially published directories; (3) foreign consulates; (4) chamber-of-commerce groups located abroad; (5) other manufacturers producing similar but noncompetitive goods; (6) middlemen associations; (7) business publications; (8) management consultants; (9) carriers particularly airlines; and (10) Internet-based services such as Unibex, a global business center.

Finding prospective middlemen is less a problem than determining which of them can perform satisfactorily. Low volume or low potential volume hampers most prospects, many are underfinanced, and some simply cannot be trusted. In many cases, when a manufacturer is not well known abroad, the reputation of the middleman becomes the reputation of the manufacturer, so a poor choice at this point can be devastating.

A. Screening
The screening and selection process itself should follow this sequence: (1) a...
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