Foreign economic activity: training course Makhovikova Galina Afanasyevna

1.5. Trade and intermediary operations

Intermediaries– these are individuals and firms that promote the circulation of goods and services in domestic and foreign markets. They facilitate the completion of purchase and sale transactions, supply, contracting, the development of rental and leasing operations, ensuring production and sales cooperation, and the provision of insurance, transport, tourism, consumer and other services.

Intermediaries are legally independent from producers, consumers and other intermediary organizations. They are bound by contractual relations with them.

Any intermediary activity is carried out by entrepreneurs with the aim of making a profit. However, despite the fact that intermediaries charge a fee for their services, their involvement gives manufacturers, sellers and buyers of goods and services the following undeniable advantages:

Intermediaries, operating in a certain sector of the market and specializing in a certain set of goods and services, can find companies interested in purchasing these products faster than the suppliers themselves, thereby accelerating the turnover of production and trading capital;

Constantly being in the market environment, studying the dynamics of supply and demand for goods and services, intermediaries can guide manufacturers in advance in which direction to develop the production of products and services, i.e. conduct continuous marketing monitoring of the market;

Intermediaries invest in the circulation sector equity, that is, they make advances to manufacturers of goods and services, creating conditions for them to increase profits by saving production capital;

Intermediaries often take upon themselves financial guarantees for the fulfillment of payment and other obligations of the parties, increasing the reliability of commodity exchange: cooperation, rental and leasing transactions, etc.;

At the request of sellers, buyers, cooperating parties and other market participants, intermediaries can provide assistance in organizing the transportation of goods, their customs clearance and insurance;

Intermediaries increase the competitiveness of goods by reducing the delivery time of goods by selling them from established product stock warehouses, carrying out pre-sale modification of goods and their technical maintenance during the warranty and post-warranty periods;

The role of intermediaries in advertising goods, which they carry out taking into account national and other characteristics of the market, is quite effective;

By specializing in working with a certain set of goods, intermediaries are able to reduce distribution costs per unit of production due to significant volumes of trade turnover.

In accordance with the provisions of the Civil Code of the Russian Federation, intermediaries are divided into the following types:

commercial representatives - carry out instructions from entrepreneurs (principals) to find commercial partners for them and participate on behalf of the principals when they enter into contracts (Article 184 of the Civil Code of the Russian Federation);

commission agents - assist, on instructions from entrepreneurs (principals), in the sale or purchase of goods under commission agreements by concluding contracts with third companies on their own behalf and at the expense of the principals (Chapter 51 of the Civil Code of the Russian Federation);

attorneys - assist, on instructions from entrepreneurs (principals), in carrying out commercial transactions, including the sale or acquisition of goods by concluding contracts on behalf and at the expense of the principals (Chapter 49 of the Civil Code of the Russian Federation);

agents - carry out, on behalf of the entrepreneur (principal), legal and other actions, including the sale and acquisition of goods, by concluding contracts in their own name, but at the expense of the principals or on behalf and at the expense of the principals (Chapter 52 of the Civil Code of the Russian Federation);

distributors - wholesale traders who, under distribution agreements, sell sellers' goods by concluding sales contracts.

Depending on the nature of the transactions performed, trading and intermediary firms can be classified as purely trading, commission, agency and brokerage.

A special role in foreign economic activity Russian organizations played by trading and intermediary firms or houses. Trading house is a type of foreign trade organization that carries out export-import operations on a wide range of goods and services. The main functions of trading houses are: organizing a network of specialized enterprises and company stores for the retail trade of goods; provision of various services in the field consumer services, catering, rest, etc.; development of new services (intellectual, personnel training, etc.); creation of enterprises (including joint ones) for the production of goods, maintenance and repair of such products; purchasing goods at our own expense, as well as on commission (consignment) terms, organizing auction, commission and mail order trade, selling goods through catalogs, etc. modern forms trade; providing intermediary services to enterprises; construction of residential buildings and other social, cultural and community facilities; performing other work and services related to their main activities.

When defining their relationships, intermediaries selling goods proceed from their own interests. Thus, an intermediary would usually like to have the widest possible range of goods, an unlimited sales territory and an exclusive, i.e. monopoly, sales right, so that neither the seller himself nor his other intermediaries would create competition for him in the market. Sellers, on the contrary, are not always interested in giving the intermediary such freedom.

There are intermediaries with a non-exclusive right to sell (the intermediary has the right to sell goods on behalf of the seller in the contract territory, but the seller has the right to sell the goods not only through this intermediary, but also others, and also to act independently); intermediaries with an exclusive (monopoly) right to sell (the seller does not have the right, independently or through other intermediaries, to sell in the contract territory goods included in the intermediary’s nomenclature); intermediaries with the pre-emptive right to sell (the right of first hand) (the seller is first of all obliged to offer the product to the intermediary with the pre-emptive right to sell, and in case of refusal, to offer the same product to another intermediary or directly to the buyer).

The first method of determining remuneration assumes that the parties entering into an agreement are sufficiently open to each other and they can jointly calculate the capital and current costs of the intermediary to fulfill the obligations assigned to him over a certain period of time, for example a year, based on the cost volume of the planned flow of goods planned by the parties. Based on this, you can determine the amount of remuneration as a percentage of the amount of each contract for the sale of goods. But, unfortunately, such an opportunity is still rare in the trading practice of Russian intermediaries.

The second, more accessible way for the seller to determine the amount of remuneration is to use competition between intermediaries. To do this, the seller must, in advance of negotiations, request proposals from other possible intermediaries, informing them of the expected nature and scope of the obligations of the future intermediary agreement. By comparing the amounts of requested rewards received from competitors, we can draw a conclusion about their optimal value.

The third method assumes that the seller can obtain data on the amount of remuneration for the sale of similar or homogeneous goods by other companies. The amounts of these remunerations require adjustment, i.e., adjustments to them for the difference in the list of obligations of intermediaries.

No less important factors influencing the optimization of the amount of remuneration are the methods of its calculation and payment. Unfortunately, in the practice of Russian sellers working with intermediaries, commission agents and distributors, it is still widespread to pay remuneration by leaving the intermediary the difference between the price set by the consignor or seller and the price at which the intermediary sells the goods on the market. This method is acceptable if the consignor or seller is confident that he has determined the export price with an accuracy of at least ±5%, which is extremely difficult to achieve, especially when calculating prices for finished products. Otherwise, especially if the seller does not know at what price the commission agent or distributor sells the goods, deviation from optimal level the rewards may be too great. In addition, the intermediary, from being an ally of the consignor and the seller, can become an enemy of their interests, insisting on lowering export prices in order to receive the largest possible amount of remuneration.

A somewhat more progressive method is the method of calculating remuneration to the intermediary based on an agreed percentage of the prices of the principals and sellers. With this method, the intermediary becomes interested in increasing export prices, since it leads to an increase in his remuneration.

The agreement may provide for a list of obligations that will be fulfilled by the intermediary on separate written instructions from the seller. Then the agreement can establish three ways to determine the remuneration for each additional order: as a percentage of the total contract value, in a flat amount, according to the “cost plus remuneration” system.

The latter system is the most modern and consists in the fact that the intermediary, having completed an additional order of the seller, sends him a report and invoice for the amount of his actual expenses associated with the execution of the order, increased by a fee of about 15% of his expenses.

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When conducting foreign economic activity, some counterparties resort to the services of intermediaries. Our law firms provide advice on the legal formalization of relations between intermediaries when working in the foreign market. We also provide legal advice to those companies that intend to be intermediaries in foreign trade activities - these are brokers, commission agents, distributors, jobbers. It is necessary for everyone who works in the foreign market to understand what foreign trade intermediation is, because Often you have to run to them, and in this case you need to know how and what services they will provide you.

Which intermediary in foreign economic activity to choose?

Depending on your experience in foreign economic activity, your ability and desire to conduct commercial negotiations, Russian companies either carry them out independently or resort to intermediaries working in the foreign market, but regardless of the involvement of an intermediary, legal assistance should always be used.

Brokers- simple intermediaries, they are contacted when there is no information about any market. Brokers are individuals or legal entities who assist in concluding a contract do not conduct negotiations, but required package documents, for example for customs, will be prepared. Broker is looking for necessary buyer, puts him in touch with the seller. At the next stage, it is worth engaging a lawyer for foreign economic relations who will help you understand the intricacies of an international contract. After signing the contract, after it is signed, the broker receives his remuneration, which is agreed upon in the agency agreement.

Trusted Intermediaries - typical for European countries. They are involved in completing a transaction on behalf and at the expense of the principal. In a commercial representation agreement, the intermediary undertakes an obligation, at the expense and on behalf of the represented person - this is the seller or buyer, to conclude a transaction with a third party for a certain remuneration. The principal agrees on all the terms of the contract with the parties before signing it, and at the time of signing, changing the terms is not allowed.

Commissioner - commission agreements are widely used in international practice. Commission agents look for partners, sign a contract with them on their own behalf, but at the expense of the seller or buyer (committee), who bear all the commercial risks of the transaction. Such intermediaries are resorted to in order to complete the transaction in full at the expense of the principal, but the search for a counterparty, negotiations, and signing of the contract will take place on behalf and at the expense of the commission agent. Commission agreements contain the powers of the commission agent for commercial and technical specifications and the obligation to agree with the principal on the main terms of the contract. The commission agent is not responsible for the fulfillment by the principals of their obligations under their mutual settlements, but an exception may be the case when such responsibility is provided for in the commission agreement. The commission agreement stipulates the amount and method of payment of the commission.

In Russia, a number of intermediary services are provided by the Chamber of Commerce and Industry (CCI). The involvement of intermediaries, as a rule, helps to increase the efficiency of foreign trade operations, despite the payment of remuneration to the intermediary. But, attracting an intermediary does not make sense if they do not provide additional profit.

Agent- marketing intermediary, he does not buy or sell goods, they are authorized by exporters to sell their products as their representatives. The exporter sets the terms of sale himself. There is an agreement between the exporter and the agent agency agreement. In Russia, such agreements are very often used.

Main volume international trade carried out at the expense of independent companies that resell goods. They are called distributors.

Distributor - these are companies that carry out sales on the basis of wholesale purchases from central companies producing goods. Agreements with distributors determine the conditions for the sale of goods, obligations regarding sales volume, the list of goods sold, conditions for maintaining warehouses, marketing research. Exporters, in turn, control warehouses and sales prices. The manufacturer may grant distributors an exclusive right, a non-exclusive right to sell, as well as a pre-emptive right.

Rewards for intermediaries:

remuneration in the form of the difference between sales and delivery prices;
remuneration in the form of interest on export (invoice) prices.

The procedure, terms and other conditions for payment of remuneration are reflected in more detail in the agreement. Sometimes the involvement of intermediaries is necessary measure, sometimes facilitating the trading process. But, when concluding an international contract, and the contract itself with an intermediary, it is worth seeking the help of a lawyer in the field of international law and foreign economic activity. You can get all consultations on foreign economic activity from our lawyers.

For more detailed information and legal advice, please contact the lawyers of our Legal Center VOSTOK-PRAVO

In the practice of International Trade there is two methods of carrying out foreign economic transactions : direct and indirect.

Direct method involves the direct sale of goods by the seller-manufacturer to the buyer-consumer. Indirect method involves the sale of goods through an intermediary.

Many years of experience in the activities of both large, medium and small industrial and commercial structures abroad have shown that the final effect of using intermediaries that connect the manufacturer with the consumer of goods and services is much higher than the creation of the manufacturer’s own sales network. It is no coincidence that the sales structures of the largest international corporations such as General Motors, Nestlé, Westinghouse, Mitsubishi Heavy Industries, IBM, British Petroleum directly or indirectly rely on hundreds and thousands of different intermediary firms operating in various countries of the world. The role of the intermediary is especially great in the sale of consumer goods on the global market, where intermediary structures play a key role in delivering goods to the final consumer. Through trade intermediaries, the vast majority of entire product groups of machinery and equipment, many types of raw materials, basic semi-finished products, finished products, food products, and consumer goods are sold on the world market. For example, according to various experts, over two thirds of mechanical products and equipment involved in international turnover are sold with the help of resellers.

Number of intermediaries.

The number of intermediaries may vary. It will depend on the product, the desires of the manufacturer, and the capabilities of intermediaries. Some possible options shown in the figure

When a manufacturer sells a product directly to consumers, it is called direct selling. The three main methods of direct selling are peddling, mail order and selling through manufacturer-owned stores.

In the case when it is used, Avon's traveling salesmen sell cosmetics to housewives by peddling. one intermediary, in consumer markets this is usually a retailer, and in goods markets industrial use often it turns out to be a sales agent or broker.

If two intermediaries are involved in the process, then in consumer markets they are usually a wholesaler and a retailer; in industrial goods markets these can be an industrial distributor and dealers.

When three intermediaries are used, there is usually a small wholesaler between the wholesaler and the retailer. Small wholesalers buy goods from large wholesalers and resell them to small businesses retail, which large wholesalers usually do not service.

There are also options with a large number intermediaries, but they are less common. From the manufacturers' point of view, the more intermediaries a distribution channel has, the less control it has over them.

Intermediaries- companies or individuals who, for a certain fee and on the basis of separate instructions or sales agreements, assume or help transfer to someone else the right to a specific product or service on its way from producer to consumer. According to the Decree of the President of the RSFSR “On the liberalization of foreign economic activity on the territory of the RSFSR,” all enterprises and their associations registered on the territory of the RSFSR, regardless of their form of ownership, are allowed to carry out foreign economic activities, including intermediary activities, without special registration.

Intermediary foreign trade transactions are transactions carried out for a certain fee, on behalf of an exporter or importer, or on the basis of special agreements, by independent intermediary firms for the sale of goods of an enterprise on the foreign market or foreign goods on the domestic market of the country.

Intermediary firms are usually used in foreign trade when the enterprise enters the market with its products new market, when offering a new product. Thus, the manufacturer, firstly, gets the opportunity to reduce its costs, because someone else's distribution network is used. Secondly, speed up the receipt of funds for the goods and, thirdly, using an intermediary who knows the market, ensure that you further consolidate your position in this market with a good price level. Intermediaries also undertake market research, which also reduces costs.

TO positive aspects The use of an intermediary in foreign trade activities can include:

1. The manufacturer reduces the costs of introducing a new product to commodity market and services market

2. Reducing manufacturer costs for market research and demand for goods

3. Efficiency in the sale of goods increases, as a result, due to the acceleration of capital turnover, profit increases

4. When contacting consumers, the intermediary has valuable information about the competitiveness of the product on the market

5. The competitiveness of the product increases due to the pre-sale service and technical maintenance provided by the intermediary.

Using an intermediary also has disadvantages:

1. the manufacturer does not receive complete information about consumer requirements for a product, about true volumes consumer market

2. the manufacturer is forced to transfer part of the profit to an intermediary

3. the consumer does not know the true identity of the manufacturer

4. dependence of export issues and expansion of the company’s market share on: activity, competence and capabilities of the intermediary

The use of an intermediary in the foreign economic activity of an enterprise does not always bring a positive effect, but there are cases when it is impossible to do without an intermediary. Firstly, when entering a new market; secondly, when entering the market with a new product (the intermediary, as a rule, better acquainted with the requirements of consumers, as well as with the consumer properties of analogue products); thirdly, when the time period for selling goods is extended; fourthly, when intermediaries monopolize some commodity markets.

When choosing an intermediary, such criteria are:: the goal of developing a new market; reputation and popularity of the intermediary in this market; the nature and size of the material and technical base; financial capabilities of the intermediary for the development of business operations; experience working with similar products or in relevant sectors of the economy; coincidence of advertising and marketing policy intermediary and manufacturer; organizational and mediator capabilities; the presence of local legislation defining the status of the intermediary, as well as the termination of the agreement with the intermediary. Of course, the involvement of intermediaries requires a preliminary economic justification, and if it turns out that intermediaries do not provide additional profit compared to independent sales of goods, then it is irrational to involve them.

The role of intermediaries in foreign economic activity.

In international practice, intermediary activity refers to the implementation of foreign trade transactions by firms and organizations, as well as individuals independent of producers and buyers of these goods.

Enterprises can enter the foreign market directly, i.e. independently carry out the entire range of activities related to the promotion and sale of goods on the foreign market. But in this case, the enterprise spends a lot of money, since it is necessary to have its own sales and service departments, it takes time to organize sales, organize advertising, in addition, it is necessary to have highly qualified employees with experience and connections in the foreign market.

There are advantages to using intermediaries that must be taken into account when conducting foreign trade transactions. The intermediary specializes in promoting goods to the foreign market, so he has commercial experience, connections in the foreign market, has information, and, as a rule, has his own sales and service department.

Specialized firms, organizations and individuals can act as intermediaries. There is a certain classification of the main types of intermediaries, based on the specifics of the activity, the scope of the powers and rights granted various types intermediaries.

1. The most common type of intermediaries are brokers. These are simple intermediaries who mainly perform the functions of “pandering”, i.e. bring together the seller and buyer, and act on the market only at the expense, on behalf and on behalf of the seller or buyer. One broker can also simultaneously carry out orders for the seller and the buyer. For his work, the broker receives a special brokerage remuneration (courtage). The remuneration amount ranges from 0.25% to 2-3%.

2. Sales agents are intermediaries acting on the foreign market on behalf and at the expense of the seller. An agency agreement is signed between the parties. The owner of the goods or the seller acts as a principal, the intermediary as an agent.

The agency agreement stipulates sales volumes for the year, the territory where the agent can operate, and the amount of remuneration. It can range from 7 to 13% of the transaction amount.

3. Intermediary consignor. The essence of consignment is that the exporter, called the consignee, transfers his goods to an intermediary consignor for certain period for its subsequent implementation.

4. Intermediaries and commission agents. They act on the foreign market on their own behalf, but at the expense and on behalf of the seller. In this case, the exporter or importer acts as a principal, and the intermediary acts as a commission agent.

Trading houses (or merchants, or sales agents). In this case, resale operations are carried out by intermediaries on their own behalf and at their own expense, i.e. a purchase and sale contract is concluded with the owner of the goods. In this case, the intermediary becomes the owner of the goods and resells it on his own behalf and at his own expense.

Foreign economic activity – important factor stabilization of the country's economy. Currently the main link economic activity is an enterprise at the level of which the main forms of foreign economic activity are implemented.

The main form of foreign economic activity of an enterprise is foreign trade activities, that is, the exchange of goods and services.

When carrying out a foreign trade transaction, it is necessary to carry out foreign trade contract– a document that should most fully reflect all the terms of the purchase and sale agreement between the seller (exporter) and the buyer (importer). In international trade practice, there are certain standards for drawing up a foreign trade contract.

When carrying out a foreign trade transaction important role plays a role in choosing the form of payment between the parties to the transaction. The main forms of payment are documentary collection (not often used) and open account (very rarely used). A documentary letter of credit and documentary collection provide the most complete guarantees of fulfillment of the terms of the contract for both the exporter and the importer.

The cost of delivering goods from the seller to the buyer is included in the price of the goods depending on how these costs are distributed between the seller and the buyer. In international trade practice, there are certain standards for the distribution of responsibilities of the seller and buyer for the delivery of the contract. These standards are reflected in the Incoterms 1990 document ( International rules on the interpretation of trade terms).