This issue of Agency Sales magazine looks at the role of reps in international commerce. And when we consider the fundamentals of the rep business model, we see that international commerce is a marketplace tailor-made for reps.
Just think for a minute about some of the major benefits reps bring to their principals: Local relationships, and knowledge about the local market and its business practices. For example, a principal in Chicago could never duplicate the relationships and knowledge a local Detroit-based rep has about his or her local market, even though the two cities are separated by only 300 miles, a five-hour drive, and a single time zone.
But that Chicago-based principal might try to service Detroit on a direct basis. And even though a Detroit-based rep could have penetrated the Detroit market more deeply and achieved greater success than the Chicago-based principal could do on a direct basis, that principal might scrape by and acquire enough business in Detroit to think he or she didn’t need a rep there.
Now consider a principal in Germany who is separated from the Detroit market by 4,000 miles, seven time zones, an ocean, language, culture, and business practices. Or a principal in China who is separated from the Detroit market by 7,000 miles, 12 time zones, an even larger ocean, and even greater barriers in language, culture, and business practices.
So while a domestic principal may think that he or she is “close enough” to the customer to serve them without a local presence, international principals are less likely to labor under the misapprehension that they can serve far-distant customers unassisted.
Reps are uniquely positioned to provide the local presence, relationships, and market knowledge international principals need, and the farther the principal is located from the customer, the more likely the principal is to quickly recognize that the local rep is crucial to his or her success.
And while representing far-distant principals can create new challenges and risks reps don’t face when representing domestic principals, one benefit of representing international principals remains clear. International principals desperately need local reps to do what reps do best — provide local presence, share their knowledge of the subtleties of local commercial practices, and leverage local relationships to create mutually profitable partnerships.