There are no regulations in the Federal Republic of Germany which bind
foreign suppliers to a specific distribution channel.
In the case of direct distribution, manufacturers supply the goods without
any interference by the trade directly to the end user.
Indirect selling methods are mainly used to sell industrial goods in
the Federal Republic of Germany owing to the relatively high cost of market
entry. Foreign suppliers can sell their goods through independent traders
(importers, wholesalers, retailers) or through sales agents such as commercial
representatives, commission agents and exclusive representatives (independent
dealers). There are special trading companies for importing goods from
abroad and selling them to domestic producers and dealers. Further information
on these import companies can be obtained from:
Bundesverband des Deutschen Groß- und Außenhandels e.
National Federation of German Wholesale and Foreign Trade Association
Tel: 011-49-30-59 00 99 50
FAX: 011-49-30-59 00 99 519
The import companies mostly specialize in goods and more rarely in countries
or economic regions.
Wholesalers and retailers are very active in the import business. This
is particularly true of the consumer goods sector. Well over half of imported
consumer goods such as textiles, furniture or foodstuffs are sold with
the help of supermarkets, mail-order companies, department stores as well
as other buying associations of the retail trade and cooperatives.
For foreign business partners who systematically supply the German market,
but do not want to set up a branch office of their own, there are opportunities
for cooperation with sales middlemen. This group of legally and economically
independent sales middlemen comprises commercial representatives, commission
agents and dealers.
Commercial representatives have turned into a cost-effective sales alternative
and can make it easier for small- and medium-sized companies in particular
to gain access to the market. The commercial representative works on a
commission basis as a self-employed business entity on behalf of and for
the account of third parties. It is a standard procedure in the Federal
Republic of Germany for a commercial representative to act on behalf of
several companies often supplying mutually complementary product lines.
Due to the regional distribution of businesses, it may -- on the other
hand -- be advisable for the foreign supplier to cooperate with several
commercial representatives at the same time.
Centralvereinigung Deutscher Handelsvertreter-
und Handelsmakler-Verbände (CDH)
Central Federation of the German Association
of Commercial Agents and Brokers
Am Weidendamm 1 a
helps to find contacts with suitable commercial representatives.
In contrast to the commercial representative, the commission agent conducts
business in his own name on behalf of a third party. He also works on
a commission basis but he can claim such commissions generally only when
the transaction he has contracted with the third party is actually completed.
The sole/exclusive distributor (often called a dealer) conducts his business
on a commission basis or on his own account. When buying and selling imported
goods on his own account and in his own name, he is an independent importer
and not an agent under German law.
SOURCE: GERMANY INFO