THE PROS AND CONS OF BEING AN INTERNATIONAL RESELLER

We did a presentation for Sunderland Software City about the pros and cons of trading internationally and we thought we would share our thoughts.

As a reseller of several international products such as Scribe and Swiftpage, we have found working with suppliers abroad can provide a mutually beneficial relationship – as long as you get it right.

Firstly, you need to establish your reasons for reselling the product. Our decision was based on the fact that the products complemented our range of software and we knew they would provide added value to our customers. The products allow us to provide our customers with everything they need without having to use different suppliers.

We have two key international partners (IPs) - one based in the USA and one based in India. Due to time differences we generally communicate via email as this is the most convenient method. Email works best for both parties, making the process a lot smoother in all aspects.

One thing we have noticed is the significant differences in the ways which they do business. For example, our US supplier is very commercially driven and focussed on targets and sales. Our Indian partner however, is very customer service orientated and will have a query or problem turned around within 24 hours in most cases. The point we are trying to make is know the culture of the country you will be working to grasp how they work and if this works for your business. We found this really helped us to know what to expect from the relationship. Other important factors to consider are annual holidays, working patterns, time differences and most importantly support back-up from the vendor.

The legal issues surrounding contracts for the partnership can sometimes be tricky and it is worth getting a solicitor involved if you think there could be any issues with legislation. A few key areas we had to consider were: which country’s legislation would apply, who would own the software licences and also who would provide the support for the software we were selling.

The financial agreement may be different if doing business abroad. Most companies operate on 30-day payment terms which we found didn’t apply when dealing with international partners. We were often asked to provide payment upfront by methods such as a credit card or wire transfer. Obviously this may affect your own payment terms for your customers and you need to build that into the relationship with your customers.

In summary, we have found working with international partners a very worthwhile and mutually-beneficial experience although, as with everything in business, it is important to fully understand the up and downsides of working with suppliers abroad.

International partners can allow you to access market-leading products that your competitors may not have, provide an all-round better service for your customers and add value to their existing software implementation. However, remember you have to establish long-distance relationships with these IPs and legislation and finance can also be problematic.

We have done it and found it a benefit to our business, but make sure you know what you are getting yourself into.