Trade Agent Skills and Competencies
Posted in News

A trade agent is an entrepreneur who connects manufacturers of products to distributors or end users. You can start a small business trade agency and even work from home with minimal starting capital requirements. To become a trade agent, you do not need education in the import/export business, but you are required to have favorable skills and competencies to excel in the trade. Importantly, a trade agent must possess negotiation skills, have an eye for trends and must be very organized as the job entails making contacts, getting the product, shipping it and reselling it at a profit.

1. Carry out market research to determine which products are in demand. Take into consideration factors such as: who will your customers be?;  How will you sell your products-directly to your customers or through representatives and distributors?

2. Establish contacts with the country or city you want to import from or export to. Contact the embassies abroad and ask them to provide you with a list of importers/exporters in the country they are located in. Visit or contact the Chambers of Commerce in any city you are looking to do business in; ask them to provide you with contacts of manufacturers, exporters, importers and distributors.

3. Evaluate the reputation of the contacts you get by carrying out Internet searches and speaking with other trade agents or distributors who have done business with the import/export company. Check on how long the import/export company has been in operation, where it distributes its product and the financial status of the company in terms of solvency.

4. Write an introduction letter to the import/export companies. Introduce yourself and indicate your interests in facilitating the importation or exportation of their product to distributors or to the end users. Write to distributors as well, informing them of your services and the type of product you can help them import or export. Provide your contacts where the exporter or importer and distributors may reach you. Follow up your introduction by calling, preferably a week after sending the letter.

5. Establish a business agreement with the importer/exporter by negotiating a distributor agreement. Check that the agreement includes information such as the commission payable, mode of payment, length of the contract and, if it is renewable, under what condition you may cancel the contract. Note that you have the responsibility of making contact with distributors or end users to sell the products obtained from the importer/exporter.

6. Establish a structure for transporting the goods from the manufacturer to the distributor. Ask other trade agents or distributors to refer you to a trustworthy freight forwarder or find one through the Yellow Pages. A freight forwarder is helpful in providing you with shipping rates, booking cargo space, arranging for merchandise insurance and making arrangements for storage before you forward the merchandise over to the distributors.

7. Price yourself and the product based on the commission you receive from the import/export company, which is usually 10 percent of the product. Multiply the 10 percent with the import/export price to see how much commission you get from each unit of the product. Add this commission to the original price of the product to get the price you should sell the product to get your commission. Obtain the final price of the product by taking into consideration expenses, such as transportation, insurance and packaging.

For more information or to implement your own company, just contact us.

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