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Export intermediaries are the specialized firms that market American products and services abroad on behalf of manufacturers, farm groups, and distributors.
They are generally found to pursue one of two major business strategies or patterns, or a combination of the two. One of these strategies is known as the export management company, the other as the export trading company.
EXPORT MANAGEMENT COMPANIES
The export management company acts as the export arm of one or more U. S. manufacturers, helping to establish an overseas market for the company's products, usually on an exclusive basis.
The management company, therefore, maintains close contact with its clients, and is supply-driven. Relationships with manufacturers are important to the success of this type of company, but close ties with overseas distributors are also a key factor.
Often EMCs use the manufacturer's own letterhead, visit the factory regularly to learn the details of new products, and develop marketing strategies for each targeted country in close cooperation with the producer.
Export management companies may take title to the goods they sell, making a profit on the markup, or they may charge a commission, depending on the type of products they are handling, the overseas market, and the manufacturer-client's needs.
Some export management companies also work on a retainer basis, especially if they are providing significant training and advice to their client or undertaking considerable up-front marketing.
EXPORT TRADING COMPANIES
The export trading company, in contrast, is demand-driven and transaction-oriented. It can play many roles, but most often it acts as an independent distributor, linking buyers and sellers to arrange a transaction.
ETCs identify what overseas customers want to buy and work with a variety of U.S. manufacturers to fulfill those requirements.
In some cases, ETCs perform a "sourcing" function, shopping the U.S. market for specific requests from overseas customers. Some firms specialize in this role.
Most export trading companies take title to the products involved, but some work on a commission basis. They keep up with the markets they serve by continual travel, participating in trade shows in the United States and abroad and working closely with distributors and customers.
EXAMPLES OF EMCs
International Trade and Marketing Corp., a Washington, D.C.-based EMC, has exclusive agreements with 10 U.S. suppliers of orthopedic equipment...