Interculturalité japonaise

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- Marketing policies

The exporter will need to know about the distributor’s marketing policies and how he deals with promotions. The exporter himself may well want to do marketer research to anticipate changes in demand in the territory. To this end, he will need the help of the distributor, to compile market research information to be used for making forecast. There is thus a collaboration between the two parties in the drawing up of these forecasts. In certain circumstances, exporters contribute funds for promotional purposes in the territory and as part of the contractive distribution (again this is a subject of negotiation that should be decided in advance).

The promotion may take the form of simple advertising or participation at exhibitions and trade fairs, in particular when these events have an international dimension. Other elements such as the number of prospects on the mailing list if the distributors use direct mail may be in the interest of the exporter and also the type of brochure the distributor uses to describe its company and the product he represents. The exporter may need its own advertising copy to be translated by the distributor and he wants to know whether the distributor is [ready/willing] to cover the translation costs (again a subject of negotiation).

- Customer profiles and other exporters represented

The exporter will want to know the different kind of customers is contacting and who is major clients are. The exporter will also want to know the identity of other exporters, being represented by the distributor and whether he will be the chief main principle supplier (=the most important) that the distributor is dealing with. This could put him in a position of strength for the negotiation of the distribution contract.

SECTION 3/ THE DIFFERENT CLAUSES OF THE CONTRACT

- The contract governs the long term cooperation between the parties.

- Distributor’s/manufacturer’s market?

- Manufacturer’s market? Rarity of the product for distribution/plethora of distributors.

The distribution agreement usually governs the terms of cooperation between the exporter and the distributor for long period of time. These distribution contracts can go on for 10, 20 years. The overall objectives of the negotiations should be to achieve a fair and well balanced partnership for the mutual benefits of the two parties.

- What is a good negotiation? Contract negotiations: fair and well-balanced?

Everybody should feel that they win. In order to get that, you have to be able to give something and gain. This is business of give and take. However it is an inescapable reality of the business world that one party will probably be in a position of strength. In relation to other party and that party will take advantage of its position of strength to impose its conditions and terms. In a situation whether are few distributors to choose from, the latter (the few distributors) could try to exploit their privilege position to impose terms and conditions. This will be called a distributor’s market: in terms of balance of powers the manufacturer needs the distributor more than the distributor needs the manufacturer.

A manufacturer’s market could stem from very rare products (that means a lot of distributors are interested in distributing it which will put the manufacturer in a position of force). The manufacturer’s market may also come from a plethora of distributors (overabundance, there is too many available distributors). The exact clauses are not always the same in all contracts and there could be different clauses like the nature of the product itself, the market’s situation, the importance or wait (influence) of the manufacturer, the legal/political/economic environment of the market.

- The territory: possible extension? Threshold. Obligations of seller and buyer

The geographical definition of the territory may consist of several countries, European Union or Scandinavian countries or even a part of a country or a country itself. Tensions need to be paid to any possible extension of the territory at a future date. Sometimes, after negotiations the distributor is given a legal right to extend the territory. When something happens on the happening of a certain event for example when the sales of the territory have reached a certain threshold over a period of time in terms of other obligations the seller generally has an obligation to refer direct inquiries from consumers in the territory to the distributor and the distributor generally has an obligation to keep lists of retails and its customers in the territory and to supply them to the manufacturer on request.

- Definition of the price: ascertainment of price, fluctuations on world markets.

There tend to be difficulties concerning the ascertainment of prices that the distributor should pay when he orders the goods on agreement. These difficulties arise from the fact that the distribution contract is generally supposed to be [long term/long range] but the price of the goods which are bought from time to time by way of individual sales contracts, under the terms of the distribution agreement may be affected by inflation or other events (ex: war) or fluctuate when quoted or world’s markets. It is very much the case for example for crude oil, minerals, and commodities.

In the contract, to the ascertainment of the final price, the parties sometimes refer to a fixed market price on a particular date such as:

- The market price of the product on the date the sales contract is entered into

- The date of delivery of the goods.

In other cases the parties agreed that the distributor should pay the Most Favoured Customer price (MFC). That is the highest possible price that the manufacturer would obtain from another most favoured customer on a fixed date.

When the MFC is agreed on, the manufacturer is generally allowed a list of exempted customers. Sales to these exempted customers should not be taken into account when fixing the MFC price. The exemptions include holding companies, subsidiaries, and affiliates. A parent company has a number of company and all of those subsidiaries are called affiliates so affiliates are subsidiaries of the same parent company.

- Terms of trade

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