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Direct and indirect export: pros and cons

This information is provided by:Netherlands Chamber of Commerce, KVKNetherlands Chamber of Commerce, KVKNederlandse versie

You want to export your goods. Do you want to keep matters in your own hands, or do you employ agents or distributors? Whether the best choice for you is direct or indirect export depends on your situation, your product, and the demands posed by the foreign market. Consider the pros and cons of both options.

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.

Direct export:direct customer contactgreater financial risks
higher profit marginsinvestment of time and staff
independence from foreign partnerslimited market coverage
insufficient knowledge of market and culture
Indirect export:no or very few extra staff requiredlower profit margins
agent knows and has access to the market and distribution channelsdependence on commitment of partner
more complete market coverage possibleno 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.

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