What does direct export entail?
Direct export means direct sales to a customer abroad. You send your invoice directly to the customer. For instance: you produce handmade mobile casings, and mail them to your customers in Belgium and Germany. You maintain close contacts with your customers and undertake your own marketing and sales. Sales through a foreign branch of your company are also direct exports.
What does indirect export mean?
Indirect export means you appoint third parties, like agents or distributors, to represent your company and your products abroad.
| Advantages | Disadvantages | |
|---|---|---|
| Direct export: | direct customer contact | greater financial risks |
| higher profit margins | investment of time and staff | |
| independence from foreign partners | limited market coverage | |
| insufficient knowledge of market and culture | ||
| Indirect export: | no or very few extra staff required | lower profit margins |
| agent knows and has access to the market and distribution channels | dependence on commitment of partner | |
| more complete market coverage possible | no direct customer contact | |
| smaller financial risks |
Record your arrangements
Whichever mode of exporting you choose, make sure you lay down your arrangements in writing. There are model contracts you can use as a basis, provided by the International Chamber of Commerce and the Verbond van Nederlandse Handelsagenten en Importeurs (page is in Dutch, but contracts are available in English). If you sell goods directly to the end user abroad, you can draw up an international sales contract. If you are starting a collaboration with an agent or distributor, you can draw up an agency or distribution contract.
Get help
Are you just starting to export? Get help:
- The KVK Advice Team has extensive knowledge on international business. Call them on 0800 2117.
- Read the 14-step plan Starting to export.
- The Netherlands Enterprise Agency RVO offers extensive information and personal advice on Going international.
- To find out about customs declarations and taxes, visit the Customs section of the Dutch Tax and Customs Administration website.