How to Start Selling Products in the Middle East
Wednesday, June 29th, 2016
Do you want to sell your goods or services in the Middle East? If you are looking for a quick and cost effective way to introduce your goods to a new market you may benefit from working with an Export Management Company.
This article explains how an Export Management Company works and why you may choose this method of exporting over other alternatives.
For businesses which are new to the Middle Eastern market there are three main ways to sell into the country: direct trade; through commercial agencies or by establishing a presence in the country. Which route you choose will depend on your business and the nature of your product or service.
If you lack exporting knowledge, then you may find it difficult to trade directly or establish a presence. For manufacturers or businesses in this position you may benefit from using an Export Management Company (EMC).
An EMC is an independent company which acts as your export sales department. It is a common method that many manufacturers and businesses use to sell their products overseas.
There are a number of reasons why you might decide to use an Export Management Company over direct exporting. Some of these are explained below:
1. Export Sales Tend to Come Quicker
Those looking to accelerate their business growth abroad quickly can benefit from using an EMC. An EMC will typically have a network of agent and distributors already in place and established contacts through which to sell your product. This will allow you to sell faster than setting up your own export channels which will normally require more time to realise sales.
2. An EMC Has the Time & Specialised Knowledge Needed
Even if you have the adequate financial resources your business may lack the time necessary to build an export business, or the time needed to gain the specialised knowledge about the foreign market you wish to sell in.
Your chosen export management company will typically have a greater understanding of the foreign market. They will be able to handle all the details of orders, including quotations and shipping.
Active contact with foreign firms is one of the key components of a competent Export Management Company and the expertise these companies have with the relative business conditions and sales opportunities is beneficial to supporting the selection of agents and distributors, and to manage the distribution network.
3. Their Profits Are Based on their Success
An EMC’s profits are based on how successfully they export. Thus, they will be motivated to sell more to increase their own profit.
4. A Way to Test the Water
By exporting through an EMC you will be able to see if there is a market for your product without taking the risk associated with setting up your own distribution channels.
Export Management Companies come in all different sizes and some will have specific industries they focus within.
Some EMCs will have established foreign sales and warehousing subsidiaries, however it is more common that the EMC will appoint an export agent or representative as a route to business.
A commissioning agent is different to a distributor. A commissioning agent will negotiate the sales on your behalf for a commission. They are preferred for products of high value, or which are bespoke or complex. A distributor will buy your products from you and sell them at a profit. This can be a preferred method for lower value “easier to sell” products. If you are entering a market where there are cultural differences, such as the Middle East, you will prefer to use a commissioning agent.
The Middle East is one of the fastest growing markets in the world, which has been providing a great opportunity for all types of businesses and manufacturers. However, with this growth also comes challenges. Having created an unrestricted trade environment competition in the Middle East has led to a crowded marketplace which may make it harder to introduce new products or services. If you are looking to export to the Middle East, you will need to have a clear understanding of the advantages of your product and how you are going to effectively target the market.
GDT are an Export Management Company with over 30 years’ experience living and working in the Middle East. Our business operates throughout the Gulf Cooperation Council (GCC) countries as well as the greater Middle East. We currently have an existing network with over 300 distribution partners.
GDT have particular experience in brand building through various trade channels including automotive, consumer chemicals, hardware, building materials, industrial chemicals, consumables and FMCG consumer products. We are able to offer a unique, cost effective and result orientated service that helps businesses and manufacturers market and grow their business based on a variable, rather than fixed cost.
For more information about exporting to the Middle East or how we can help please call us +97143206673 or email: info@gdtme.com