Looking to start selling your products in China but don’t know where to find qualified distributors? Look no further! This article will teach you everything you need to know about finding reliable Chinese distributors. From online directories to trade shows, we’ve got you covered. So what are you waiting for? Start expanding your business into the world’s largest market today!
What are the Benefits of Working with Distributors in China?
It’s not uncommon for foreigners to work with distributors to get a hold of the Chinese market. Such companies can help you with importing, storage, sales, shipping, and even marketing if you need. There are many reasons why working with a distributor will work to your advantage, including:
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- They have a huge network of partners who will be able to sell and deliver your products to chinese customers and retail stores directly.
- Having a distributor means you won’t need to register your company in China which can be a challenging and lengthy process that is best avoided.
- Because distributors take a commission from the sales, they use this as a great incentive to look for as many sales as possible.
What are the Disadvantages?
Unfortunately, if you’re unable to find the right kind of distributors, you may have a few disadvantages.
- Picky Distributors : Some partners can be picky when it comes to products, and as a result, you may need to be aware of the brands within the Chinese market. Because the market is overly competitive, the distributors have more products to choose from. If your sales don’t reflect the numbers they want, they will simply move to a different company.
- Asking for Exclusive Rights : If this is your first time selling in China, it’s best to avoid writing an agreement that provides your distributors with the exclusive rights to sell your products. This is because they might be working with a competing brand and they may simply forget your products. However, should your distributor insist to have exclusive rights to your product, be sure to include a sales quota that lowers the risk of poor sales within your agreement?
- Little Controle over distribution: everything is conducted in Chinese, your distributors work through is network which is very opac and you’ll have a hard time getting a full understanding of the distribution process.
How Can I Find Distributors in China?
To find a distributor, various ways need to be considered. Trying just one route isn’t likely to provide the full extent of resources that your brand will need. As such, it’s important to try various sources and come up with solutions based on the needs of your company.
For those who don’t speak Chinese, finding distributors can be a particularly challenging job. Be sure that you have the right people with you to make it easier, and don’t be afraid to spend time and money to save yourself from failure in the long run. Here are just a few of the most common options to take to find potential distributors.
Chinese Trade Fairs
Taking part in Trade fairs is a great way (as long as you are well prepared for it) to make a lot of contacts after just one visit to China and can help you find plenty of Chinese distributors and importers. Having your products on display will help to catch the attention of interested parties and there are many trade fairs you can register for. But be sure to remember that fairs will be crowded and it may be hard to communicate your brand and company to others.
Chamber of Commerce
You should consider contacting the Chamber of Commerce in China when looking for distributors because most will provide companies with a list of distributors inside their sector. They will have a wide network for you to look through and they may even have contacts for the distributors. At the very least, they may be able to connect you to the right service providers.
Foreign companies will often hire 3rd parties that may help them find the right Chinese distributors. They will analyze the market and provide translations for your product descriptions then list them online for distributors to see. Third parties can also attend trade fairs on your behalf to promote your products at these events. Doing this can save you a lot of time and provide you with great exposure.
Meeting Distributors in Person
Choosing Chinese distributors and becoming partners requires a long-term relationship, so meeting them should be done in person. During your meeting, you will need to evaluate the work they do and how serious they are to work with you. They will also take you more seriously if you take the time to meet them.
Be sure to ask necessary questions while taking a tour of their facilities. To get you started, here are a few questions you can ask while speaking to the distributor:
- How many years have you been in business?
- Do you have success stories you can share?
- Which companies have you worked with?
- Where are your partners based?
- How will you help us grow in China?
- What are the biggest challenges you’ve faced?
Selecting a Chinese Distributor
There are also quite a few questions that you will need to ask once you’ve narrowed down your candidates for a distributor. When you’re at the point of conducting background checks, be sure to research the company with both Chinese and English language sources. Several China-specific agencies can give you comprehensive evaluations of companies.
Here is a list of questions you should consider before making the big decision of collaborating with a Chinese distributor:
- What is the company background? How big are they and what is their ownership history?
- What is the size and caliber of their sales force?
- Who are their previous clients and do they have any customer feedback or trade and banking references?
- What are their distribution channels?
- What is their regional coverage?
- What are the outlets covered and call frequency?
- Do they have adequate transport and storage facilities?
- Will they have a minimum sales quota? (This is necessary if they have exclusive rights to the products)
- What are the terms for payment and shipping?
- How will they handle trademark registrations? (This process is best done on your own — sometimes, distributors will register the products in their name)
- Who will pay for what? (This can include presentation materials, sales training, marketing, translation, and more)
- What laws will the distribution relationship be under? (This is best done under a distribution agreement that can be enforced in China, using Chinese law within a Chinese court)
- How do you handle warranties?
- Do you use a China NNN agreement for trade secrets? (This stands for Non-use, No disclosure, and non-circumvention. If they refuse, it’s best to look for someone else)
- Is this the right distributor for you?
- Are they easily contactable?
- Will they benefit from your product?
- Do they have a conflict of interest or any deals with competitors?
- Do they have a history of representing products similar to yours?
Support Your Distributor to Increase Sales
It’s important to remember that as much as the distributor has an obligation with you, you also have an obligation with them. It’s normal to expect the distributors to have some knowledge of the product you give them along with the marketing that goes with it. But you also have a responsibility to provide them with all the necessary information and training they need to encourage sales.
It’s not uncommon for distributors to expect foreigners to provide some funds for trade shows or to pay for training. For everything to run smoothly, ensure that you’re both on the same page before entering a partnership. It’s also vital that you include everything needed within the final agreement.
It’s also worth remembering that distributors won’t have deep knowledge regarding product specifications, at least not compared to the salesforce or sales engineers of the exporter. Because of this, it can help to upload teaching materials on your product’s website or to send an employee to coach the distributor’s team at the beginning.
Doing this will help to enhance their selling capability. If they aren’t ready to promote your products, they won’t be able to earn you money. It’s best to first create a marketing plan that you can share with them. In the end, it is still your responsibility to work on marketing, so you should help them with sales as best as you can.
Lead Gen & How to get the attention of Chinese Distributors?
With classic communication such as emailing not being heavily used in China and the huge amount of demands distributors in China receive every day, it can be a challenge to establish initial contact with them. That is why we recommend that you combine your prospection effort with an online marketing effort and have distributors contact you rather than the contrary. Not Only an online presence will give you visibility but it will also build your product selling potential which will make your brand more interesting in the eye of a Chinese distributor.
Furthermore, being known to Chinese consumers is so valuable. It provides the brand with more leverage when negotiating deals.
So here are some of the channels you want to consider when building a distribution network in China that will also give a boost to your brand reputation with direct consumers!
Website + Baidu SEO
You can also create a Chinese website for your products so that distributors will also find you online. Fortunately, many eCommerce agencies can assist you with your SEO and SEM needs which can be tailor-made for the Chinese market. If you have questions or inquiries, the place to be is Baidu since Google isn’t used in China.
PR, Chinese Forums and Q&A
Having a great PR strategy will help your brand build visibility and credibility, two criteria that are essential to set yourself apart from the competition and that distributors will be looking into.
Forums are an easy way to create a strong online presence and play a role in building your online reputation. As customers speak about your goods, they demonstrate an interest that will not go unnoticed by Chinese distributors. The best part is that this conversation on forums can initially all be created by your marketing team and then as it gains in traffic, the content will be generated organically.
Chinese Social Media Accounts: Wechat
Having an active official presence with a decent following on them will certainly be an added bonus to convince distributors to work with you. Although, when it comes to tools to prospect Chinese distributors the best Chinese social media is Wechat which is widely used among professionals in China and is the best channel to nurture your contact list.
With 1 billion users, WeChat is the biggest social media platform in China, where you can find and connect with potential distributors while being able to market your brand. It can be used as a tool for communication as well as a place to put your products on display through WeChat brochures. There are plenty of benefits to using brochures, including:
- Easy to use and share
- Have lower costs
- Are interactive
- More intuitive than PDFs
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