The United States, promising but competitive
Being the largest economy in the world, the US has a significant influence on the global market. With a big consumption market, diverse culture, and a developed economic system, the US is a tempting destination for many international businesses. Diversity is characteristic of the US market.
How to find your agent or distributor?
The United States of America (USA) has a population of 327 million. In 2022, 83% of the population lived in the cities, and this percentage is slowly rising. The average income per capita is almost 60,000 USD. This is promising to sell your goods, but you’ll have to know where to start. A state-by-state approach might be a good idea, or first to focus on some major cities.
If you speak English, the language does not seem to much a barrier. But the culture of doing business can be totally different then you expect. You need to present yourself well, and the first time should be right. A local agent or distributor can help you with that.
Set up your ecosystem for physical products
In smaller countries you may find a distributor who also imports and pushes your products to retail. In the United States the import function is often with specialised companies, as a lot of goods already come from the States. And the distributor focuses mainly on the logistic distribution tasks: warehousing, repackaging, grouping, shipping. This means that having a distributor does not mean that your product is being promoted. For this you may need sales brokers, if you don’t do it yourself.
So if you want to get started in the USA, you should target both importers, distributors and sales brokers to get everybody lined up. You may choose to work with a third-party-logistics company (3PL) who takes on the importing and distribution role. The difference with a distributor is that you pay a 3PL for warehouse space and each activity, while a distributor takes ownership of the goods and get his payment from the margin he makes.
For software and customized products, get an agent or reseller
If what you sell is less tangible, or if it can be easily shipped directly from your factory or workshop to the client, then the physical distribution is less a thing. The main focus is then the sales. You would need an agent or reseller in the various parts of the country who would take this role for you. If you want the agent to work just for you, then there certainly needs to be a fixed monthly (minimum) remuneration. If the agent or reseller also is active for other principals, then make sure the your margin is the highest and your ordering process is the smoothest.
Alliance experts can find the distributors, brokers or agents for you
Alliance experts helps companies with entering new markets profitably. In the United States we are present in a number of cities with experienced business development specialists. What would be the right approach for you would depend on the type of product:
| B2B products, high value, small volumes | One distributor or agent for the whole country may do, unless the sales process is complex and local service or maintenance is needed. |
| B2B products, high volumes | For logistic reasons and if applicable for service and maintenance, you may choose for regional distributors |
| B2C products with regulations per state, like medicines and alcohol | One distributor per state |
| Other B2C products | You may start with one distributor first, who is the most eager to test the market for you and support the sales with brokers. Later on you may choose more distributors and set up you local company and do some sales directly. |
We have a clear and structured approach to find the best partner
We first want to know what kind of partner you are looking for. Based on your information, we make a long-list of 15-20 potential partners that fit your description. After your approval we find the right decision maker, approach him or her personally and share your business profile with them. This mostly leads to 3-5 companies who are suitable as your partner and interested in working with you. Once we have found these companies, we plan your meetings and accompany you during the first visits.
Opportunities in the USA per region
New York
- Consumer industries and real estate industries are at a benefit due to affluent, cosmopolitan consumers.
- Financial capital of the world
- Hub for media, social media, and innovation
California
- Consumer industries and real estate industries would do good in this state with the same reason as in New York’s.
- Logistics capital for US-Asia trade flows
- Home for technology companies
- Hub for start-ups
- High tech manufacturing in the industries of aerospace, defence, match, and semiconductor equipment
Texas
- Houston as the world’s capital of oil and gas industries.
- Immigration of professional classes lead to:
- Economic diversity
- Opportunities for consumerism and real estate
North Dakota
- Potential for oil and gas investments
- Shale Boom
- Primitive infrastructure that is very appealing to companies and real estate industries.
Massachusetts
- Life sciences capital of the world due to research and commercial clusters
Washington
- Home to Boeing
- Hub for global aerospace
- Home to tech giants
Bring your budget to enter the USA market
The potential of the United States is huge, but competition is also strong. It may not be possible to find just one agent or distributor who covers the whole market for you, mostly you will have to work with one per group of states. Unless you can do business with one of the big retailers.
If you want to enter the market, bring your budget. You will have to go there and spend time. If you want our team or any other consultant to do a distributor search for you, think of 10,000 to 15,000 euro as a base fee. Your distributors will ask for marketing materials, perhaps advertisements, retailers will ask for slotting fees. So draft a proper business case and be prepared to invest in order to gain.
Alliance experts is happy to help you with your strategy to enter the USA market.
