Should a manufacturer contribute towards marketing costs?

Question

We recently gained our first distributor, in Germany. This week they said they have secured us a great ad spot in a German trade magazine and asked if we would like to pay for it so they can go ahead.

Should we pay for this? should they? should it be split?

To be honest our distribution agreement is pretty vague regarding this.

Appreciate any advice.

Answer

Hi Ewan,

Thank you for your question – I hope you receive some useful answers.

This question came up in our recent EU webinar and our Agents and Distributor webinar also talked about this sort of thing, so check these out if you have time.

http://opentoexport.com/article/webinar-working-with-agents-and-distributors/

http://opentoexport.com/info/webinars/#europe

Thanks

Will

Answer

Hi,

I have helped a number of manufacturing clients get their sales and marketing material translated. In my experience, it seems that most clients prefer to organise the translation themselves as it gives them the advantage that they retain overall control over the process. They also build loyalty with the distributor as it shows a willingness to shoulder some of the sales/marketing expenses, which the distributor would otherwise have to pay. This can really help when the distributor is pitching your product alongside those of your competitors.

Nevertheless, sometimes distributors are willing to make a contribution to the cost of the translation, and this can work well for both parties. I would avoid the temptation, though, to leave it all up to the distributor. For one thing, they are usually too busy to translate things and so there is a risk that the translation of your carefully-worded sales brochure gets rushed, which can lead to silly mistakes!

Hope that helps,

David Wheatley
Dot Comma Translations Ltd
+44 (0)203 488 0986

Answer

Hi Ewan

From my experience, I would try to share the costs, this will show willingness and will test their determination as well. This sets the mark for future cooperation.

When we attend trade shows with distributors and/or agents, we mostly share the costs, often 50/50.

Hope this helps.

Edward.

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