Which international sales channels are appropriate for me?

Sarah Carroll is the director of Grow Global, a consultancy that mentors and trains clients on how to improve their international communications, and one of the UK’s leading experts on how to make a web site visible in international search engines. 

In this article, Sarah discusses what’s the best sales channel for your product.

Online channels

Traditional methods of selling internationally through agents and distributors are still a prime way of attracting new customers and getting your products and services well-known in a new country.  Equally, finding well-matched stockists and retailers who would like to sell your products in another country can give you exposure to new customers, as can attending exhibitions and conferences abroad.  Ultimately, setting up an office or shop in another country is a longer term possibility too.

More and more, companies are realising the potential of reaching their customers by selling directly online.  Even companies selling services can use their website as a lead generation tool, and companies selling products can make healthy international sales through a well-designed e-commerce website.  But selling online doesn’t just mean having your own full e-commerce website – there are plenty of other ways to sell your products and services in other countries, many of which are low risk and allow you to test the water. You can add your products to the international versions of Amazon and eBay or to an e-marketplace like Alibaba or Mercado Libre, or simply add a PayPal button to your webpages. For fast visibility in local search engines, add your products to a local distributor’s or stockist’s website, set up a local social media presence or start an online advertising campaign.

You can find out more about e-commerce in the selling online internationally article and you can read about selling online through e-market places as well.

Choosing to sell your products internationally can be very exciting, but it is worth understanding the different ways to reach international customers before you start.

You need to find out where your customers are around the globe, taking into account different customer tastes and shopping habits, then finding out the best route to sell into that particular country so you build the volume of your sales.

For selling products direct to international customers, we’ve picked out four of the most popular sales channels in this at-a-glance guide to get you off to a flying start.

Agents

• Are paid commission based on an introduction to a potential customer in a particular geographic market
• Commission ranges between 2.5% to 20% on average with different industries having differing levels
• You provide training and promotional materials to help them sell your product
• After the introduction you close the sale
• After that you will owe them commission on the sale at the agreed rate and on any other future business with that customer which is part of the agency agreement
• You may well choose to have one or two agents per country
• In the EU, you need to be aware of the implications of the EU commercial agency directive
• Find agents exhibitions and by online and offline research

Read this article on breaking new markets with commercial sales agents for more information.

Distributors

• Sell your product in an agreed geographic market
• They buy, store, market, sell and support your product in the agreed international market
• This is effectively a direct sale and you will be expected to discount your price to reflect the amount of work the distributor does on your behalf
• Discounts will generally range from 25% to 40% depending on your sector
• Likely to have a few distributors across a large country or if you sell into different sectors
• Find distributors at exhibitions and by online and offline research

Read our article on the differences between agents and distributors or watch Open to Export’s webinar on working with agents & distributors for further information on either of these routes to market.

Stockists and retailers

• Sell your product in their stores – both bricks and mortar or online
• Can be a large national department store or supermarket or can be specialist independent shops
• Likely to have more than one in a country or even a city
• They buy, stock, market, sell and support your product in their country
• This is effectively a direct sale and you will be expected to discount your price to reflect the amount of work the stockist or retailer does on your behalf
• Discounts will generally range from 25% to 40% depending on your sector
• Find them at shows and by online and offline research

Read our article on selling internationally through stockists and retailers for more information.

Direct to customers and consumers

• This includes direct to businesses and direct to consumers
• Businesses – find them online, e-commerce, e-marketplace, at tradeshows or set up an office in another country
• Consumers – find them online, e-commerce, e-marketplace, social media or set up a shop in another country
• You take full responsibility to stock, market, sell and ship
• This includes appropriate paperwork to support the sale to the end consumer and handling support and returns
• Set your own price to maximise profit

Remember our articles on selling through e-commerce and through online marketplaces for further information on these channels.

It’s a good idea to do a lot of research and weigh up the pros and cons of each approach and put together a market entry strategy, which might be different for each market you are targeting. For example, you might go the distributor route in Spain, but sell your products through a big department store in France, sell online in Germany through your e-commerce website and on an e-marketplace in China.

There will be a method that suits you and your business the best. However, you may find, as you grow internationally, that you have a mixture of sales channels that provide you with a spread of activity across the globe.