World is expanding like the theory of big bang. Every nextexisting or new organization is trying hard to be a part of world expandingbusiness. Organizations are promoting their products by their cranky ideas ofadvertisement, to attract the customers. Spending heavily on promotion,advertisement, new schemes, and sales technique to sell their product.


Eventually they are spending very high budget on promotiontechniques, they always look for other resorts to offset or subdued the prices.Few of resorts are:


  • Increase in prices
  • Elimination of mediators like wholesalers, distributors, agents etc.
  • Staff cuts and layoffs
  • Bonus and incentive cuts


If we go in details of understanding the psychology of humanbeing, high prices, staff cuts, and bonus and incentive cuts will adverselyaffect the brand image and sales of the products, due to involvement ofpsychological and esteem factors of society.


High prices eventually shift the consumers to adopt otherbrands, due to presence of cutthroat competition. Henceforth, ultimate goal ofan organization does not solve by increasing prices, which ultimately whop offthe growth of organization. In same way layoffs, job cuts, bonus and incentivecuts are striking idea to hit self-motivation of their employees. It will shatterthe image of organization due to frequent layoffs and employee's turnover.


Hence, not all these resorts are a clever idea to seek foroffsetting the prices.


Last and ultimate resorts left with organization areelimination of mediators. Wherever possible put skills, knowledge, efforts,foresightedness, trends study, research and development dept, and traveling isthe solution of elimination. Reason is to grab the suppliers, buyers, to reachthe ultimate consumers are some of the major reasons to rely on mediators.


Let us take an example of buying agents, buying agentscoordinate and liaison between buyer and supplier and eventually receive theproceeds of their liaisonning. Many times there interest rate goes high from 7to 10%. Not only have they charged from suppliers for their services. They alsocharge from Buyers for their liaisonning a times. Buyers generally face belowproblems:


  • Language barriers
  • Lack of awareness of suppliers and their credibility
  • Types of products are offered in the target market fabrics, accessories, stitching, designs etc.
  • Proximity of suppliers
  • Easy going system with the support of agents.


Henceforth suppliers end up paying high rates for services.Same problems which supplier face are Awareness of buyers, their requirements,quality standards, finally their credibility.


Suppliers and buyers are required to put little extraefforts to eliminate them. Nevertheless complete elimination of mediators isnot possible, always depends on he geographical, political, economicalcondition of country. Countries like, Bangladesh, Pakistan, Vietnam, Mongolia, Nepal, Sri Lanka, some African and South American countries, they really needmediators, their economy still under developing stage, and political andeconomical upheavals are still concerning areas. Their language andtechnological advancements barriers are slowing the stage of their growth.


However, Countries like China, Hong Kong, India, Thailand, Egypt, Dubai, Indonesia, Taiwan etc, where barriers have almost eliminated. Politicaland economical stabilities, high literacy rates, updated education system havemade these places highly competitive and more attractive for investment. Nevertheless,it all depends on the internal conditions and level of organization to dealdirectly with buyers. Let us take an example, if an export house operating fromChina/India is looking forward for dealing with international buyers directly.


What all Exporters need to have to approach them?

  • Frequent traveling to buyer's country for presentation & sample display
  • Attending international tradeshows and exhibitions like, HK buyer seller meet, Magic USA, Paris Prt porter etc.
  • An upgraded office and showroom facility for meetings
  • An excellent bilingual staff with up-to-date command over international language skills, English/French/Italian/Spanish etc.
  • Payment terms-collection or letter of credit.
  • E-commerce, Websites,
  • A dedicating quality tech. & assurance team along with compliance department.
  • Checking buyers credibility from Embassies/consulate offices in supplier country

Now let us discuss what all international buyers required to do from their side.

  • Factory visits to check their facilities, compliances, quality issues, capacity, and kind of products
  • Checking credibility with Supplier's country consulate.
  • Complete knowledge of product and their technicalities
  • Price issues, their objectives, sales projection, estimates.
  • An excellent bilingual staff with up-to-date command over international language skills, English/ French/ Italian/ Spanish etc.
  • E-commerce, Websites,
  • Payment terms-Collections or Letter of credit


Ultimately, it is costly affair for both parties to arrange for staff/ travel/ websites/ checking credibility etc. Buyer and supplier both travel to each other's country for their only orders. It is viable only when quantity is in bulk from half to one million pieces (a rough estimate). As I mentioned earlier, complete elimination is not possible. However, an effortful try can be helpful for small supplier and buyers to earn some profit. It is rule of trade, that as the product will pass on as many hands, it will add a cost to it. Supplier and buyer have to decide, what package they are looking for.


A complete hassle free limited profit or a little hassle with tons of profit.


About the Author


The author is student of Post Graduate in International Business at George Brown College, Canada.


The author expresses his views on Fate of mediators (apparel buying agents)