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Exclusivity vs. Temporary Monopoly

 

Lining up good stateside distributors is challenge enough, but finding committed distributors overseas is even more daunting.Most foreign distributors want exclusivity. Should you grant it?

No - and yes. When PC Globe, a Tempe, Ariz., company that put the atlas onto software, first went overseas, managers cutdeals with distributors offering exclusivity without any performance clause or insistence on a front-end order. Overseas productsales languished.

The company then changed its strategy. If distributors want exclusivity, PC Globe makes them order 20% of what they thinkthey can sell in a year as their first order, which has to be prepaid. As long as distributors keep ordering the same amount eachquarter, they retain their monopolies. They don't get exclusivity as much as the opportunity for exclusivity, saycompany execs, who add that the second strategy has worked out better for everyone.

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