bg thu tin thuong mai chapter 9 5743

CHAPTER Agents and agencies Types of agencies( brokers, buying and selling agents); finding an agent; offering an agency ( convincing the agent, exclusive or non-exclusive agency, area to be covered, commission, settlement of accounts, support from the principal, delivery, duration of the contract, disagreements and disputes, special terms); asking for an agency ( convincing the manufacturer, suggesting terms) Type of agencies: Brokers  Brokers usually buy and sell goods for their principals (the firms they represent) and sometimes never handle the consignments themselves  There are various types of brokers: Brokers/dealers, Ship brokers, Insurance brokers, brokers on the commodity markets, brokers on the metal exchange  Contact between buyers and brokers is done by phone, cable, fax, or telex, as prices in the market tend to fluctuate quickly, even by the minute in the case of bullion and foreign currency Type of agencies: Confirming houses + These agents often receive orders from abroad, place them, arrange for packing, shipment, insurance, and sometimes finance or purchase the goods themselves Then resell them to the client + They may act on a commission, but if buying on their own account will make a profit on the difference between the ex-works price and the resale price they quote the importer Type of agencies: Export managers  If a firm does not have a branch the country it is exporting to, they can appoint an export manager He will deal under his own name, but use the address of the company he represent  His job is primarily to develop the market for the exporter, and for his services he may charge a fee, or arrange for a profit-sharing scheme between himself and the exporter Type of agencies: Factors These agents can buy and sell in their own names, i.e on their own account, receive payment, and send accounts to their principals They often represent firms exporting fruit or vegetables  Note: ‘Factoring’ is the process in which the firm buys the outstanding invoices of a manufacturer’s customers, keeps the accounts, then obtains payment  ‘Non-recourse factoring’ involves the buying up of outstanding invoices and claiming the debts If the buyer(the manufacturer’s customer) goes bankrupt, the factor has no claim  In ‘recourse factoring’ the factor will claim from manufacturer if the customer cannot pay  Type of agencies: Manufacturer’s agents  This agent represents a manufacturer and obtain goods, then resell them  The agent may work on a commission, i.e buying the goods on consignment, or, if described as a merchant, he will buy the goods from the manufacturer on his account, that is to sell his principal’s products, and not those of a competitor and the manufacturer would probably agree not to supply the sole agent’s rivals in his country Type of agencies: Buying agents  Buying agents, or buying houses, buy products on behalf of a principal and receive a commission The agency is employed to get the best possible terms for their principal, and will try to find the most competitive rates in shipping and insurance for them Buying houses often act on behalf of large stores  The orders sent to buying agents are called indents and are of two types: open indents, where the agent chooses his/her supplier, and closed or specific indents, where the supplier is named by the principal Finding an agent  It is possible to find an agent through a number of sources: advertising; in Trade Journals; contracting government departments of trade in your own country or the country you wish to export to; consulting Chambers of Commerce, Consulates, Trade Associations, and banks  Letters to these organizations are routine, and the guide below gives you an indication of how these letters are laid out Opening Tell the organization who you are We are a large manufacturing company specializing in… We are one of the leading producers of… You probably associate our name with the manufacture of chemicals/textiles/business machines/ heavy engineering… Explaining what you want We are looking for an agent who can represent us in… We would like to appoint a sole agent in Scotland to act on our behalf selling… We are trying to find an established firm to represent us in selling our products Asking for an agency Here is a guide to the kind of letter you should write if you want to offer your services as an agent to a manufacturer Opening Explain who you are and how you saw or heard of manufacturer’s product  You were recommended to us by our associates Lindus Products Ltd Of Lagos, who told us that you were looking for an agent to represent you in oil-drilling equipment in Nigeria  We are contacting suppliers of medical equipment in your country with a view to acting as their representative here in Saudi Arabia Your name was given to us by the British Consul in Jeddah We already import medical supplies from a number of different countries, but are particularly interested in the E.E.G machines and scanners you manufacture Convincing the manufacturer You have to convince the supplier first that there is a market for his product in your country or area, and second that you are the best person to develop the market and sell his goods  As you know, Germany is extending its farming areas with the aid of government grant to farmers and his expansion is creating a demand for all forms agricultural machinery, particularly with regard to your products We have many contacts in the government who will direct us to large-scale farms and enterprises which are in the market for your products  We have an established reputation in Nigeria for supplying oil companies here with excavation and drilling equipment and are quite willing to offer your references We can also assure you of excellent sales prospects as the oil industry is rapidly expanding  Because we have already established business relationships with hospitals and clinics here in Saudi Arabia we are sure that we should be the best company to represent you here And as you are probable aware, the development of the health service here means that generous grants to clinics and hospitals have increased the demand for more sophisticated equipment that you manufacture Suggesting terms You may want to leave discussion of terms until after you know that the supplier is interested in your request But there is no harm, even at this stage, in describing the terms on which you normally operate and asking if they would be acceptable in the present case  May we suggest the terms we usually operate on to give you an idea of the sort of agency contract we are considering? We generally represent our principals as sole agents for Germany, buying products on our own account, with an initial contract to run for one year, renewable by mutual agreement We expect manufacturers to offer advertising support in the form of brochures- in German and English-and catalogues, and in return we promise our customers a full after –sales service and two-year guarantees on all products Therefore we would expect a first class spare-parts service with delivery for both manufactures and spare parts within six weeks of receipt of order We would pay you direct by 40-day bill of exchange, documents against acceptance If this type of agency interests you, please contact us so that we can draw up a draft agreement Specimen letters and forms Offer of an agency Specimen letters and forms Agent’s reply, asking for more details Specimen letters and forms Manufacturer’s reply, giving more details Specimen letters and forms Reply to an offer of an agency Specimen letters and forms Request for an agency Specimen letters and forms Reply to a request for an agency Specimen letters and forms Request from a buying agent Specimen letters and forms Reply to buying agent’s request Specimen letters and forms Agent’s report Specimen letters and forms Account sales Points to remember  If you are offering an agency to someone, convince him that your products are worth selling and will find a market in his area  Be clear about the type of agency you are offering: exclusive or no-exclusive, on a consignment basis or a sale and retail basis  Offer terms and suggest methods of settlement of accounts Be positive about the support that you, the principal, can provide for agent  If you are asking for an agency, make sure the manufacturer appreciates the standing of your company and convince him that his products will be well represented ... sources: advertising; in Trade Journals; contracting government departments of trade in your own country or the country you wish to export to; consulting Chambers of Commerce, Consulates, Trade... however, you should make them sound as inviting as possible  The agency we are offering will be on commission basis, and as we are very interested in getting into the French market, we are prepared... represent you in oil-drilling equipment in Nigeria  We are contacting suppliers of medical equipment in your country with a view to acting as their representative here in Saudi Arabia Your name was