Hi there haywire! Always good to see you here. Let's tackle these one-by-one:
When I am approached by a distributor, I test the waters with a blend of optimism and necessary caution. Here are the questions I ask:
● Please provide a full listing of current brands you are importing, along with their country of origin.
● I'd appreciate the contact information for any principles affiliated with those brands so that I may secure a recommendation.
● Please outline your distribution model- what types of establishments you sell to, what type of sales force you have employed, a full listing of any office/warehouse facilities you have secured, etc.
● A brief outline of your background and the history of this distribution company would be greatly appreciated.
● Any details/statistics you can provide with regards to the (insert country here) personal care/beauty market that you can provide would be helpful.
● Finally, any details or information you can provide detailing the process of clearing US-manufactured personal care products through the (insert country here) authorities would be appreciated.
That's what I use as a "first pass" response, but it's a good beginning.
2. I am utterly convinced that you can successfully google damn near anything! Give it a whirl and see what you come up with. There are also websites such as
http://www.alibaba.com/ that are designed to connect importers and exporters. You can also browse the websites of companies that sell related goods and see if they list their distributors. But please, whatever you do, don't go to your competitor's websites and approach their distributors. Look for complimentary, rather than competitive brands. If I had a dollar for every time my Arabian distributor was approached by a competitor telling her they can "run circles around Bella Luccè"...well, I'd be so wealthy I wouldn't need Bella Luccè. It's poor form!
3. I never, ever enter a distribution arrangement without a contract. I have a general contract that I work off of and then tailor specific details to the region I'm working with. Essentially, I only work with exclusive distributors, which means I am giving you the rights to Bella Luccè within region X for period of time Y. With that understanding, I require annual minimum purchases in order to maintain exclusivity. So my contract covers details such as:
Region covered
Minimum purchase requirements
Acceptable methods of payment
Anticipated lead times
Acceptable selling venues
Freight arrangements
Confidentiality clause
Explanation of any marketing support provided
Pricing: is tiered pricing available? How often can pricing be adjusted? Etc.
Termination terms
4. I touched on this on my above answer to nvalue. Essentially, 15-50% off wholesale, which is a mind-boggling percentage off retail. Those margins are tough and require an understanding that you're dealing in volume to make money. I find it especially tricky to manage export costs with handmade products, so I think those of us in the indie beauty industry have to be especially vigilant, but it's certainly possible.