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1、Chapter 11 Agencyv11.1 Background InformationvGeneral agent:a general agent may be a firm or a person who acts under some degree of instruction from his principals to sell(or to buy)goods on the best terms obtainable.He charges a commission for his services under some kind of agreement or contract.v
2、Sole agent:similar to general agent,a sole agent may be a firm or a person who acts exclusively for one foreign principal with exclusive(or sole)agency rights to sell on a commission basis certain commodities in a certain area under some kind of agreement or contract for a specified period.A sole ag
3、ent will not sell products that compete with those of the principal.vCommission agent:a commission agent is not exclusive.The principal can appoint one or several commission agents in the same area at the same time.Every agent will do his best to maximize sales for his principal,because he lives on
4、commission which is usually a percentage of the sales he makes.v11.2 Situational Conversation vSection 1:Agency(1)vA:First of all,I would like to thank you for your kind invitation to visit your beautiful country.I hope my visit will help to promote a friendly relationship between us.vB:Weve been lo
5、oking forward to your visit.It is a great pleasure for us to have you as our guest.It is always more convenient to discuss things face to face.vA:I would like to tell you that my clients are very satisfied with the last delivery of your slippers.The styles and colors are very much to the taste of ou
6、r market.vB:Weve received some similar comments from other Australian firms too.vA:I understand you are selling the same products to some other Australian importers.This tends to complicate my business.As you know,I am experienced in the business of slippers and enjoy a good business relationship wi
7、th all the leading wholesalers and retailers in that line.I have a mind to expand this business in the years to come.One of the reasons of my visit here is to sign a sole agency agreement with you on these items for a period of 3 years.As it is to our mutual interests and profit,I am sure youll have
8、 no objection to it.vB:We appreciate your good intention and your effort in pushing the sale of our slippers.As you know,the demand for this item in your market is quite substantial.However,according to our records,the total amount of your order last year was moderate,which does not warrant an agenc
9、y appointment.Unless you increase the turnover we can hardly appoint you our sole agent.vA:Ill come to that.My proposal is as follows:Plastic slippers of all sizes,50,000 pairs annually within the area of the whole Australian market.We expect a 5%commission,of course.vB:As far as I remember,we sold
10、about 40,000 pairs last year to you alone.Dont you think this annual turnover is rather conservative for a sole agent?vA:Well,I admit I always do business on the safe side.Could you let me have your proposal then?vB:Lets put it this way.I propose a sole agency agreement for ladies and gents plastic
11、slippers(excluding childrens)for a duration of 3 years;60,000 pairs to be sold in the first year,70,000 pairs in the second year,and 80,000 pairs in the third year,the area is to be within the continent of Australia(excluding any neighboring island),commission 5%.vA:You certainly drive a hard bargai
12、n,Mrs.Brown.vB:On the contrary,Mr.London,we value your friendship more than anything else.We both understand our slippers are very popular in your market on account of their superior quality and competitive price.And with the sole agency in your hand,there will be no competition and you can easily c
13、ontrol the market,which would naturally result in bigger sales.Im sure you can fulfill the agreement without much difficulty.vA:Well,if you put it this way,Ill have to comply.When shall we sign the contract,Mrs.Brown?vB:Tomorrow afternoon.vA:Tomorrow afternoon will be fine.vSection 2:Agency(2)vA:I t
14、hink you have known already that I want to discuss the representation for your alarm clocks.vB:Yes,Mr.Bergerson.You mentioned that in your letter.To tell you the truth,your proposal surprised us.vA:Is that so?Anyhow I want to go over the details with you in person,so you can give my suggestion thoro
15、ugh consideration.Our firm specializes in this line of business.We have six sales representatives,who are on the road all the time,covering the whole of the European market.vB:Do you sell direct to shops?vA:Yes,we specialize in handling clocks and watches of all sorts.We have well established channe
16、ls of distribution and we canvass the retailers direct,without any middlemen.vB:Do you keep a stock of these things?vA:In some cases,such as the wristwatches,which always have a steady market,we keep a stock in London and act as distributors as well as agents.Generally,however,we pass on the orders
17、of our clients to the manufacturers for supply.We are paid for our service,of course.vB:That is,your commission.vA:Yes,our commission is very reasonable.We usually get a 10%commission of the amount on every deal.vB:Our agents in other areas usually get a 3-5%commission.vA:The European market is not
18、familiar with your products.You have competitors from Japan and other continental countries.At the beginning of our campaign,there is sales resistance to overcome,we must send out salesmen to do a lot of traveling and spend a considerable amount of money on advertising in newspapers and TV programs.
19、A 10%commission will not leave us much.vB:According to your estimate,what is the maximum annual turnover you can fulfill,in round figures,of course?vA:We will always do our utmost to enlarge the business,as our remuneration increases with the turnover,but we will not guarantee anything,at least not
20、to begin with.vB:We appreciate very much your intention to push the sale of our products.But our suggestion to you,Mr.Bergerson,as a preliminary step,is to do a little research into the market vA:Do you mean to say you refuse us the agency?vB:Mr.Bergerson,you leave us no alternative.We cannot give y
21、ou an exclusive agency of the whole European market without having the slightest idea of your possible annual marketing turnover.Besides our price is worked out according to the costing.A 10%commission means an increase in our price.We must have the reaction of the buyers in this respect.vA:Oh,thats
22、 just too bad.I intended to make great efforts in selling your products.vB:Well,we can still carry on our business relationship without the agreement.To start the ball rolling,we will provide you with price lists,catalogues and some samples.Only when you have a thorough knowledge of the marketing po
23、ssibilities of our products,can we then discuss further details.vA:Ah,Mrs.Miller,but in this case am I covered?vB:Oh,yes.We will give you a 5%commission on every transaction.vA:All right,but Ill be back again for the Autumn Fair.And then I hope we can see eye to eye about our commission and the term
24、s of the agency.vB:Very good.We will discuss the matter again at the next Fair.vSection 3:Agency(3)vA:Im pleased to meet you again,Mrs.King.vB:Pleased to see you,too,Mr.Brown.vA:Youve had a good trip,I hope.vB:Yes,a very pleasant journey,thank you.vA:Its been a full two years since we last saw each
25、other.vB:So it is,Ive come again to renew our sole agency agreement for another 2 years.vA:We shall be pleased to talk the matter over with you.Youve done very well in fulfilling the agreement.vB:Im glad youre satisfied with our work.I can assure you weve spared no effort and spent quite a sum of mo
26、ney in pushing the sales of your products.vA:Yes,we appreciate your efforts in pushing the sales of our pianos.We can see you are experienced in this particular line.vB:Thank you.vA:But I think the annual sale of 300 pianos for a sole distributorship in Canada is rather conservative.After all,you so
27、ld around 400 pieces there last year.You can sell more this year according to the marketing conditions at your end.vB:That is the result of our hard work.Well,what annual quantity would you suggest for the new agreement then?vA:500 pieces.vB:No,no.Thats too big a number to be acceptable.Lets put it
28、at 450 pieces.And well strive to sell more,of course.We wish to add another clause.For every 50 pieces sold in excess of the quota,well get 1%more in commission for our efforts.vA:All right,lets fix it at 450 pieces then.And for every additional 50 pianos sold,well give you 1%higher commission.vB:I
29、suppose all the other terms remain unchanged.vA:We would like to make a specific mention of one more point.As our sole distributor,you will neither handle the same or similar products of other origins nor reexport our goods to any other area outside your own.vB:No,certainly not.Thats a reasonable re
30、striction.vA:Another thing is that every six months we would like to receive from you a detailed report on current market conditions and the users comments on our products.vB:Yes,weve already prepared one.Ive brought it with me.Ill put it forward when we talk with the manufacturers tomorrow.vA:Good,
31、thats all then.vB:Good.v11.3 Email Communication vLetter 1:Applying for Sales AgencyvSeptember 1,2011vDear Mr.Chen Wei,vI would like to take this opportunity to introduce to you my company Sompamith International Trading Co.Ltd.vWe may be able to assist you in marketing your products in Laos.At the
32、present moment we are acting for several major manufacturers to whom we give a service based on a sole agency agreement.vOur company is well established,and over the years has developed a thorough knowledge of the commercial market in Laos.We have an experienced and extensive sales organization.Our
33、branch offices are spread throughout Laos,and are staffed with experienced sales managers and sales representatives.vFor some time as sole agent we have been representing a company that you may know,as its head office is also in Kunming,Jinma Electric Motor Factory.vThrough collaboration with that c
34、ompany we have learned that you require an agent to assist you in marketing your dump trucks in Laos.Sompamith International Trading Co.Ltd.specializes in your particular line of China-made machinery and equipment for the Southeast Asian market.vSompamith International has a good track record,and we
35、 would be pleased to offer our expertise and service to promote your sales.We believe that your products add to our portfolio and would be of mutual benefit to both companies.vIf both our companies can agree to favorable trading arrangements as to terms and conditions,we as sole agent would be pleas
36、ed and willing to represent you.vIt is hoped that you would give this proposal your most serious consideration.Yours sincerelyvEncl:Our company brochurevA list of clientsvReferee:Jinma Electric Motor FactoryvLetter 2:An Unfavorable ReplyvSeptember 7,2011vDear Mr.Somphouthong,vThank you for your lett
37、er of September 1 suggesting that we grant you a sole agency for our dump trucks.vI regret to say that,at this get-acquainted stage,such an arrangement would be rather premature.And what is more,we have appointed a sole agent in Laos already.vWe would,however,be willing to engage in a trial collabor
38、ation with your company to see how the arrangement works.Also,it would be necessary for you to test the marketability of our products at your end.You would also have to build up a much larger turnover to justify a sole agency.vWe enclose our latest price lists and catalogue covering all the products
39、 you are interested in and look forward to the pleasure of hearing from you.Yours sincerelyvEncl:Price lists and cataloguevLetter 3:Accepting Proposal for Sole AgencyvOctober 6,2011vDear Le Van Sang,vThank you for your letter of September 18 proposing a sole agency for pushing the sales of our bulld
40、ozers in Vietnam.vWe have examined our long and,I must to say,mutually beneficial collaboration.We would be very pleased to entrust you with the sole agency for the bulldozers in Vietnam.vFrom our records,we are pleased to note that you have two service engineers who took training courses at our Kun
41、ming factory.The sole agency will naturally be contingent on you maintaining qualified after-sales staff.vWe have drawn up a draft agreement that is enclosed.Please examine the detailed terms and conditions and let us know whether they meet with your approval.vWe shall be very glad if you will kindl
42、y confirm it and return one of the duplicates duly signed to us if it is acceptable to you.vAn early reply would be highly appreciated.Yours sincerelyv(signature)vEncl:Draft Sole Agency Agreementv11.4 Practical Skills vSkill 1:Explanatory Notes on Technical Terms v1.agent n.代理人 v(1)If you would appo
43、int us as your agent,we could give you a reasonable guarantee to sell US$100,000 a month because yours is a line we can handle well.v(2)The exporter may employ an agent living in the buyers country to push the sale of his products.v2.Sole Agency AgreementvNovember 1,2011vCamellia Machinery and Equip
44、ment Co.Ltd.,45 Beijing Rd.,Kunming,Yunnan,650011,China(hereinafter called Party A)and Road Construction Supply Co.Ltd.,22 Tran Xuan Soan Street,Hanoi,Vietnam(hereinafter called Party B),desiring to develop business based on the principles of equality and mutual benefit,have agreed as follows throug
45、h friendly negotiations:v(1)Appointment of agency:Party A agrees to appoint Party B to act as its sole agent in Hanoi,Vietnam for the sale of the under-mentioned commodity,and therefore no sales of competing bulldozers shall be made in Vietnam,either on Party Bs account or on account of any other fi
46、rms or companies.At the same time Party A is not allowed to appoint other sole agents in Vietnam for the same product during the life of the agreement.v(2)Name of commodity:Type DJ-4 bulldozers with the brand name of Dongfeng.v(3)Price and quantity:Party B is under an obligation to push sales energe
47、tically at the competitive price quoted by Party A.Each transaction is subject to Party As final confirmation.It is mutually agreed that during the validity of this agreement,Party B shall place orders with Party A for not less than 5,000 bulldozers.Party B shall order at least 2,000 bulldozers in t
48、he first six months from the date of signing this agreement.Should Party B fail to fulfill the above-mentioned quantity(namely 2,000 bulldozers)in this duration,Party A shall have the right to sell the goods under this agreement to other customers in Vietnam.In case Party B places orders for less th
49、an 1,000 bulldozers in the three months from the date on which the agreement is signed,Party A shall have the right to terminate this agreement by giving notice in writing to Party B.v(4)Reimbursement:Party A owes Party B a duty of reimbursement,i.e.Party A repays Party B for the expenses that Party
50、 B incurs in carrying out Party As instructions.But Party A pays no subsidy for Party Bs sales promotion or publicity to canvass business if any.v(5)Liability:Party B is not liable for the contracts it negotiates for Party A unless it acts outside the scope of its authority,for example,Party B inten