What are the modes of trade?

Distribution refers to a way in which importers (distributors) sign distribution agreements with foreign exporters (suppliers) and undertake the obligation to sell designated goods within a specified period and territory.

There are two kinds of distribution methods: one is exclusive distribution, also known as exclusive sales, which refers to the distribution method in which the dealer enjoys the exclusive franchise right to the designated goods within the time limit and territory stipulated in the agreement. The other is general distribution, also known as fixed sales, that is, dealers do not enjoy exclusive franchise rights, and suppliers can determine that several businesses distribute similar goods in the same area at the same time.

2. Agency

Agency refers to a trade mode in which an agent enters into a contract or performs other legal acts with a third party on behalf of the principal under the authorization of the principal, and the principal is directly responsible for the rights and obligations arising therefrom. Agents in international trade are divided into general agent, exclusive agent and general agent according to the size authorized by the principal. The general agent is the authorized representative of the principal in the designated area, and he has the right to engage in general commercial activities and some non-commercial affairs on behalf of the principal. Exclusive agent or exclusive agent refers to the agent who engages in the relevant business specified in the agency agreement on behalf of the principal in the specified area and within the specified time limit. A general agent, also known as a commission agent, refers to an agent who does not enjoy the exclusive right to operate, that is, several agents can engage in related business on behalf of the principal at the same time in the same region and within the same period.

According to the nature of the industry, agents can be divided into sales agents, purchasing agents, transportation agents, advertising agents, litigation agents, arbitration agents, bank agents and insurance agents. Only the most common sales agents in import and export business are introduced here.

Step 3 entrust

Consignment is a trade mode of consignment, which means that the consignor first transports the goods for sale to a foreign consignment place, entrusts the local consignor (consignee) to sell them on his behalf according to the conditions agreed in the consignment agreement, and then the consignor and the owner settle the payment.