Port of Mucuripe – Fortaleza – Ceará – Brazil
Photo Credit: Skyscraper City
Strategic partnerships in potential overseas markets can help producers and manufacturers, lacking the size and might of multinational corporations, to sell their products on the international market. The import/export agent is one such partnership.
At Italbras Leather Producer & Exporter Ltd.,* I had the opportunity of working with five competent and reliable import/export agents. All were specialized in working in the leather industry.
When I joined the company, Italbras had partnered with an agent in the United States who represented its finished upholstery leather across the nation. Based on the number of American clients represented, he was our top agent. An expert in leather production, he worked closely with our Production Manager on matters relating to our American clients’ quality control requirements.
For the most part, since our American agent traveled a lot across the United States visiting clients, I maintained direct daily contact with his female office assistant. She handled orders, clearance of shipments, returned goods, and payments. We worked well together. When resolving issues that arose from time to time, I could always count on her quick action.
Later, through partnerships with import/export agents in England and Australia, Italbras expanded its exports of upholstery leather and cut-and-sewn leather covers to England, Wales, Australia, and New Zealand. An Italian agent provided entrance to more markets for our leather in Europe: Denmark, Finland, Italy, Norway, and The Netherlands. Another Italian agent negotiated orders with new clients in Asia: Hong Kong, Indonesia, Malaysia, Singapore, Taiwan, and Thailand.
Each agent brought their own expertise and knowledge to dealing with the challenges of their market. For example, after finding several shipping pallets with bark, the Australian sanitary inspectors impounded our two 20-foot containers for two weeks for fumigation treatment. Our Australian agent took care of the fumigation and ensured the release of our goods as soon as possible. Delays cost money and garner client dissatisfaction.
Thenceforth, not only was the export department required to inspect all pallets before palletization, we also had to arrange fumigation of all containers destined for Australia. This also entailed coordinating Brazilian customs inspection of goods at our factory before fumigation and sealing of containers.
The Asian market required payment terms by Irrevocable Letter of Credit. While Letters of Credit offer more security for both parties, they require extra care when preparing the shipping documents. A simple error can cause delays in clearance and receipt of payment.
By expanding our exports overseas, our import/export agents added value to our company. For their part, import/export agents earn a commission, usually varying between 12 and 15 percent over the FOB value (excluding cost of freight) of every shipment. Money well spent. Money well earned.
Where there’s mutual trust, confidence, and integrity, it’s a partnership that works well for both parties.
* Fictitious name