CENTER GROUP is the solution for companies which aim to develop their own distribution channel in Brazil, Mexico or the USA.  We offer alternatives for every export project, including market research, formalities before public organizations to register products or other type of registrations and opening your own business in any of these markets. In this way, you will create your own distribution channel, and then end up outsourcing your business management, accounting and foreign trade and according to your business needs.

The creation of your Own Distribution Channel, where you export to yourself, have become a worldwide trend, and CENTER GROUP makes this alternative possible for meeting values adapted to Argentine SME (PyME) current needs.

The benefits obtained from using your Own Distribution Channel include the following:

How does this service work?    

This service was created both for companies that export in some markets where we have our own offices and for those that are not currently exporting but aim to do so. Basic information for companies that are not exporting yet:

It is worth mentioning that a product can not be launched into the market without previously informing it. 

Center Group can access all the necessary information since it has been operating for more than 17 years in MERCOSUR and 10 years in NAFTA.  

Center Group aims to identify, through a customized Market Profile, in which exporting condition your company is, taking account the following items:

Once the information obtained on the basis of the analysis have proved that the product can potentially reach the target market, CENTER GROUP offers a service that includes the following:      
 

Opening and Management of a Company in the target market of your interest

This service involves launching your own business in the market chosen in order to import and sale your products locally, outsourcing the management of the business, or leaving this job to CENTER GROUP, so that the launching of your business abroad does not take extra time from your daily activities. 


How does the businessman benefit from hiring this service?

1. It is much easier for him to sell his products since there are many companies which are potential buyers in the proper markets but they may not be importers.  In Brazil, the Brazilian businessman prefers not to import by himself unless it is a company of considerable size. 

2. The businessman can compete on equal terms with local products as if his company were a local business (in fact this is a local business with foreign capital).    

3. The businessman can export without the need of operating with a letter of credit or taking a very high risk sending products to an importer using the method Clean Collection or without Bank Guarantee.  

4. By avoiding the middleman, the businessman can export more goods, the importer in the trade chain, the product can be sold at a better price.  Depending on the market, you will be able to sell your products obtaining more profits, winning in both markets.

5. You reduce your collection risk, since when you deliver goods to small buyers, the potential of the amount traded increases, minimizing the risk of final collection.  
Note: For example, in Brazil there are companies operating with an uncollectibility rate not higher than 0.25%, which is considered an excellent rate for the Latin American market parameters.  There is also the possibility to work with companies of local credit insurance which allows ensuring all the sales made in cases of uncollectibility.

6. The company gets the best feedback of the product in the market, taking into account that he is closer to the end product consumer. 
if the market "requires” any change in the product, the exporter with his own channel in the target market will be the first to acknowledge that request.  In traditionally export, that information is only available for the importer, who on some occasions chooses to change supplier instead of asking him to change the product. 

7. The brand is better protected, since he does not depend on mediators. 8. The businessman can "manage” his business directly.  Traditionally, the trade strategy is set by the importer and it is not always the most adequate for the product. 

9. If the product requires specific registrations before any Ministry or Secretariat, these registrations will be property of "HIS" company.  Traditionally, the holder of the registrations is the importer.  So, if the importer stops the orders, in order to remain in the market, the registrations should be made out addressed to the new importer again; this procedure is generally expensive and slow.


What does this methodology offer to the export businessman who wants to open his own distribution channel in the target market?

Export increase for those who are already exporting and the development of new markets for those who are not. 

It is worth mentioning that our service includes local support to the company, that is to say, during the adaptation period of the exporting company to the idiosyncrasy of the consumer of the market in which the businessman intends to launch his products.
All data coming from any market where CENTER GROUP has offices is delivered to the exporter businessman in his own language.  

The businessman receives daily information via e-mail about the payments to be made the following day.

On a weekly basis, the businessman will also receive a report about the sales made, bills collected, bills due and the “receivables”.

He will also receive information about the cash flow that will allow him to estimate surpluses and shortages. 

Once a month, he will receive a consolidated report with all the data sent in the previous weeks.  Where are the goods stored? General Warehouses where the fee is proportional to the square meters of the area are used.  

Thus, we avoid the need of renting a building without being sure of using it at full capacity.
In every city where CENTER GROUP has offices, we have agreements with General Warehouses on the basis of used volumes of the companies that are currently operating with the firm.  

If the operation requires the rental of the company’s own space, then CENTER GROUP takes care of looking for the most adequate location and discussing the better conditions.


How are the goods delivered to the local customer in the target market?

Local Transport Companies where the fees are proportional to the deliveries made are hired. 

In all cases, at least three estimates of three companies are required, and then the one offering the best cost-effectiveness relation is hired. 

In all the cities where CENTER GROUP has offices, we have agreements with Transport Companies on the basis of the continuous flow of delivery of the companies that operate with that company.

How can the businessman control his money in the target market?  On a daily basis, we receive a report about the bills to be paid the following day. These payments can be via Internet together with the checking account reconciliation in the operation market. Based on weekly reports, the export businessman can make single audits. 

On a weekly basis the hiring company receives a file with the following information:
a. Weekly sales.
b. Collections made during that period. 
    b.1. Due and unpaid collections during that period. 
    b.2. Collections to fall due from the following day onwards. 
    b.3. Copy of the Bank Book.
    b.4. Copy of the bank abstract.

Since all operation amounts are recorded in the checking account of the company (the cash account is not used in the markets where this is allowed, and under no circumstances sale occurs without registration), all that was recorded as collected should be recorded in the bank book. 

All that is recorded as “collectible” for the following week, can only appear in the next report as collected, and therefore should be recorded in the bank book, or as fall due. 

Copies of all issued bills are sent in order to audit the company stock. 

Every three months a verification balance sheet is sent together with the company situation statement.

Observations:
CENTER GROUP does not provide accounting services. We can advise you of Accounting Companies that you can hire, which have the necessary experience of foreign capital companies in each market.

What service does CENTER GROUP offer?

CENTER GROUP does not sell products, but contributes to the searching of the more competent Trade Representatives to market the products of the company involved.   

Is there a minimum time of hiring?

There is no minimum time of hiring. 
CENTER GROUP has a premise that states that the hiring company should remain in the structure due to the cost-effectiveness relation, but not due to a contract that makes it stay against its will.

A mutual 90 days’ rescission notice is needed to avoid inconvenience for any of the two parties.


How does CENTER GROUP secure the hiring company that it will administrate its money adequately?

The parties involved sign a liability agreement in which Center Group takes responsibility for all the money deposited in the checking account of the hiring company, in the country where the service is being provided.  There is no problem to guarantee neither with the net assets of the company nor with the Director Shareholders the money deposited in the checking account of the hiring company.

It is clear that CENTER GROUP does not take local credit risks.  

That is to say, CENTER GROUP does not take responsibility for non-payments as a result of a sale, since it is not Center Group who decides whether to sell to a certain customer or not.  

On the other hand, we can present trade competence reports about a potential customer, at the expenses of the hiring company, in the market in which the service is being provided.

What is the goal of CENTER GROUP?

The goal of Center Group is to participate actively in the development of exports in countries where the company has its own organizational structure.   

The local Office aims to be an active tool to approach: