Guatemala - Selling Factors and TechniquesGuatemala - Selling Factors
Guatemalan purchasing decisions are primarily based on price, service, and quality.
Direct sales by U.S. exporters to end-users, importers, wholesalers, and retailers are usually most successful when the product is well-known within the market, or when a limited number of large buyers exist. Direct sales are often supported by local advertising, sales promotion campaigns, technical or illustrative brochures, visits by salespeople, and in some cases, samples.
Sales via local agents and distributors are usually the most effective means of penetrating the market. The U.S. exporter appoints a person or firm, which in turn, either promotes sales on a commission basis or purchases the merchandise and re-sells it. End-users and retailers generally do not have the time or experience to import directly, which involves handling customs clearance.
If a U.S. firm signs a representation contract, it is important to know that such will be subject to the Agency, Distribution and Representation Law, contained in Congressional Decree No. 8-98, of February 4, 1998.
According to this law, in Article 290, there are five instances by which a contract may be cancelled;
1. As a result of mutual consent
2. As per expiration date, if indicated in the contract
3. As per the local agent’s decision, as long as it provides three-month notice. In such case, the agent is subject to responding to all pending settlements according to the contract
4. As per the principal’s decision, in which case it will be responsible for all damages to the agent, as a result of the termination
5. As per fair cause, which includes all sorts of situations common to the termination of a commercial relationship
The law presents details on each situation. It is recommended that an attorney, other than the one representing the local firm, is consulted for the signing of these agreements.