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Do I need to work with a Chinese distributor?

Depending on the geographical region and the market segment, companies selling to China may need to engage several different distributors and sales offices in China. If possible, it is advisable to use a two-stringed sales and distribution model, relying on local distributors in combination with their own direct sales force. The local distributors provide geographical and market scale while the internal sales force’s focus should be on the direct access to existing and new customers.

In general, there are different types of importers:

  • Large state-owned importers, usually having a nation-wide coverage. These focus on stable supplies and volumes, are extremely price-sensitive, and look for products and brands which are already recognisable by Chinese consumers. Usually, they are not interested in working with SMEs.
  • Private importers, usually having limited geographical regions, focusing on one or two cities, provinces or a macro-region. These may too focus on volumes and stable suppliers, but are in general more willing to work with SMEs.
  • Smaller importers, sometimes set up by foreigners, who have a better understanding of European products and specialise on imported goods. These operate mainly in larger cities and are usually more flexible on volumes and more willing to accept new products.

In any case, it is not recommended to sign any exclusive agreement with one single distributor (unless it is linked to very large volumes of sales), as this will limit efficiency and control, especially during expansion.