RESPONSIBILITIES OF THE IMPORTER IN FOREIGN TRADE OPERATIONS
I see many approaches about the responsibilities of exporters/manufacturers in international trade, but little has been said about the responsibilities of importers/distributors in this process.
It is as if the maxim “customer is always right” was employed at any cost here, and each time the exporter needs to enforce a right or contractual condition already implicit and consolidated in his national market, he becomes a villain and the agreements are broken.
Over these more than 10 years working in international trade I have seen a lot of injustice being done by the importer against the exporter. A total transfer of their responsibilities to the detriment of the rights of the other. We are talking about negotiations between small and medium-sized companies, but the most curious thing is that when exporters are large conglomerates, things change.
Multinationals in the health field (which is the sector where I have the most experience) completely dominate their importers, with contracts of more than 40 pages with the most diverse requirements that even generate high costs for the importer, and of course they still feel lucky to represent such global brands in their countries, and they really are.
However, a medium-sized national company has a lot of merit, and having reached its current status, it is certainly a highly respected brand in its country of origin. If the importer would be willing to read 40 pages of requirements from a multinational, why could he not commit to a short list of requirements from a smaller company? After all, both companies will form a single entity in the eyes of customers in the target markets, so they must be very well aligned.
The behavior of the importer influences not only the partnership with international suppliers, but also the health of their business. Some behaviors that I see frequently and that should be rethought are as follows:
Distributors that do not interact with manufacturers about the product and the market:
It is very common for distributors to offer products to their customers with superficial knowledge and without asking for help or explanations from manufacturers about more details, ending up selling products with characteristics that sometimes do not even exist.
It is also common for distributors not to give feedback to the manufacturer about their weaknesses and strengths in the market, in addition to statistical information, with indicators of their business, to help manufacturers improve their products.
Distributors that do not respect the manufacturers' internal processes:
There is no patience to wait for data processing and decision making at the factories.
With the multitude of quality standards, be it management or product, that manufacturers must follow (and are even at the tip of the tongue of any importer when looking for an international supplier), making any changes is not automatic, nor should it be.
A poorly designed project can lead to discredit in months what a brand took decades to build.
Therefore, importers' suggestions are always welcome, as long as they are accompanied by numbers and include internal processes.
To learn more about projects, I suggest that you talk to my friend Paulo Passarini: http://rapassarini.com.br/
Distributors who place all commercial responsibility on manufacturers:
Distributors generally do not follow the manufacturers' guidelines on their products and make sales without the necessary sieves, in addition to not studying the products sufficiently, they often refuse to question customers about the real needs of some requests and aspects of the negotiation, even when the manufacturer insists on obtaining the information.
This behavior results in a poor sale, which does not meet customer expectations and harms both brands (manufacturer and distributor), and is often followed by unreasonable demands from distributors, who try to be compensated 100% by manufacturers when in fact, the situation was generated by aspects of their own behavior.
Distributors that carry out impulsive imports, without clarity of their market:
I would like to think that I made sales of this nature because I am a very good salesperson, but the truth is that my client was a bad buyer.
Such behavior generates conflicts and disappointments on both sides, as well as ancillary obligations, such as the generation of additional content by the exporter to try to minimize the losses of that importer.
Since we are talking about international business, regretting the purchase and returning the product by Courier is not an option. In Brazil at least, if a product comes out as an export it can only return to the country as an import, the rates are so high that many times the best thing to do on the exporter's side is to discard the product in the country where it is located.
When we are talking about a technical problem generated by the manufacturer, discarding the product may be an option, but the importer's regret for a poorly thought-out purchase is not.
Distributors who make last-minute requests by default:
Lastly and perhaps the most controversial of my statements, I would like to talk about the distributors who always start their emails with URGENT in the subject.
I don't remember participating in and winning a process like this, but I get requests like this all the time, usually from bids that are due the next day. I already worked directly in a bidding department in a Brazilian company, and I know that they do appear, but not as often.
If the distributor always arrives late for a bid, he may have to change some procedure internally, but be constantly making last-minute requests to suppliers as it is not only risky but also counterproductive. We are talking about international complex product businesses, which involve reviewing technical characteristics, time zones, linguistic and cultural barriers, and of course, the organization of each company. Certainly, manufacturers do not work exclusively to serve one customer at a time.
I do not release the responsibility of the manufacturer in this entire process, which must clearly establish its conditions at a much earlier stage than the actual sales, documenting the responsibilities of each party for resolving conflicts such as those listed above, far beyond the conditions already exhausted such as INCOTERMS, validity of the proposal and product warranty time.
But as this article is aimed at changing behavior on the part of IMPORTERS, in summary what I can say is:
Take time to study the product and the market before closing any partnership;
Take responsibility for selling the product, think that if something goes wrong for the customer, your brand is also at stake;
If ISO 9001 or ISO 13485 are so important to you, then accept and respect companies' internal processes when making any request;
Make a reflection between delivery time of your requests versus delivered quality;
Develop your own internal procedures and follow them;
Follow up on opportunities, identifying what an opportunity really can be and what is pure waste of time.
Participating in international negotiations can be fascinating, but it requires a lot of discipline and dedication on both sides, so be prepared!
I hope to negotiate with you all over the world. 😊