The Ever Evolving Landscape of International Business: Move Beyond Agents & Distributors!
Michael Westenberg
?? Value-Builder | Providing unbiased support to drive business growth | Sharing my journey
Are you a succesful entrepreneur or business person & Do you live in the now? The now being the 2020s. If your are...it's safe to keep on reading ??
By being in the now, I hope that you will be able grasp why I believe that if any Brand or Manufacturer wants to still be in business in 20 years from now (the 2040s) they need to ditch their Agents & Distributors representing and selling their brands and products in international markets.
If you are consciously living in the 2020s, you are well aware that the world has changed significantly since the 80s and 90s. Millennials and Gen-Z are defining consumer behaviour and it will not take long until 'they' will rule the world.
Be aware: Millennials and Gen-Zs don't have the patience to watch Rosco and Boss Hogg trying to catch the Duke-Boys for 147 episodes spanning 7 seasons. 'They' want instant satisfaction, because it guarantees instant access. And what does that mean? Simply said, just being able to 'connect to everybody anywhere' or being able 'to buy products instantly from everywhere' or being able 'to cancel anybody and anything when out of interest'.
To satisfy the Millennial's or Gen-Z's need for instant satisfaction, a business model devised during the Industrial Revolution will not be the saving grace of your Brand and Company.
Yes, the role of Agents & Distributors was invented in the 1800s to connect manufacturers to distant markets and retailers. In the 20th century the consumer goods category really developed, and so in the 60s, 70s, 80s and 90s Brands increasingly relied on their agents and distributors to handle marketing complexities and sell to a growing range of diverse customers in different regions of the world.
In the '90s we did not have WiFI, internet or e-commerce! Millennials were just out of their diapers and Gen-Zs were just starting to being born.
But in today's business world, policies and decisions on growth and expansion strategies are dictated and managed primarily by people who were raised and educated in the 80s and 90s. Reality check: in those days Daisy Duke Jeans Shorts could not be instantly ordered on Amazon and Michael Knight's watch and K.I.T.T.'s onboard computer were considered to be sophisticated technology.
Well if your an entrepreneur or business person who still thrives on 80s and 90s nostalgia, there is a big chance you are not living in the now. So, for the sake of your business - Wake the F... up!
Because, in today's rapidly changing global marketplace driven by the need for instant satisfaction, the traditional role of agents and distributors in international business is facing significant challenges - consider them obsolete, their expiry date has simply passed.
While these intermediaries have played a crucial role in facilitating cross-border trade for decades, the modern business landscape demands a more direct and agile approach. Here are several reasons why I think the role of agents and distributors is no longer the preferred way of conducting international business:
1. Digital Disruption: The digital revolution has transformed the way businesses connect with customers around the world. With the advent of e-commerce platforms, social media, and advanced communication technologies, companies can now reach consumers and partners directly without the need for intermediaries. This digital transformation allows businesses to interact with customers in real-time, collect data, and adapt their strategies rapidly to changing market dynamics.
2. Cost Efficiency: Agents and distributors often top-up margins pricing product out of the market, require substantial commissions or fees for their marketing services, which can significantly impact a company's bottom line. By cutting out these intermediaries and consider platform organisations, businesses can reduce costs and reinvest those savings into product innovation, marketing, and better customer experiences.
3. Control and Flexibility: Working with agents and distributors means relinquishing some control over how products are marketed, sold, and distributed. In contrast, businesses that handle international operations directly can maintain greater control over their brand image, sales strategy, and customer interactions. This flexibility allows them to respond more efficiently to market trends and consumer demands.
4. Market Understanding: In the past, agents and distributors were valuable assets for navigating unfamiliar markets and bridging cultural gaps. However, modern businesses can now leverage data analytics and market research tools to gain deep insights into foreign markets, enabling them to understand consumer preferences, anticipate trends, and tailor their offerings accordingly.
5. Speed and Responsiveness: In today's fast-paced business environment, speed is a critical competitive advantage. Working with agents and distributors might introduce delays in communication, decision-making, and order processing. Direct engagement enables businesses to be more agile, respond quickly to market changes, and seize new opportunities as they arise.
6. Brand Reputation: Agents and distributors may have multiple brands in their portfolio, making it challenging for your products to stand out. By managing international operations directly, businesses can focus on building a strong brand reputation and forging direct relationships with customers, which can lead to increased customer loyalty and word-of-mouth referrals.
7. Regulatory Compliance: International trade involves navigating complex legal and regulatory frameworks in various countries. When businesses work directly, they have more control over ensuring compliance with local laws, reducing the risk of legal and reputational issues that may arise from inadequate oversight by intermediaries.
8. Technological Advancements: The advancements in logistics, supply chain management, and global shipping have made it easier for companies to manage international distribution themselves. With modern tools and technologies, businesses can efficiently handle shipping, customs clearance, and inventory management without relying on third-party intermediaries.
I can only conclude, the role of traditional agents and distributors in international business is becoming no longer relevant...I believe they are in their 142nd episode of Season 7 of 'the Dukes'.
As an entrepreneur or business person being in the now, its your job to get in control of your business and its future. Look for and explore new alternatives that redefine the role of traditional agents and distributors......please for the love of god, stop chasing them Duke Boys!
Solutions - there are plenty, but to find them you first will need to:
In one of my next blog article's I will share my thoughts on what could be potential solutions...to be continued...
Feel free to leave your thoughts and comments, or if you want me to help you out changing and growing your business...drop me a message. Happy to listen, talk and jump in!
Remember*: Stop chasing them Duke Boys!
*mnemonic / ezelsbruggetje