Generalizes on the best strategy to enter the market, e.g., visiting the country; importance of relationships to finding a good partner; use of agents.
Last Published: 8/19/2019

Most exporters find that using a local distributor or agent is the best first step for entering the Malaysian market. A local distributor is typically responsible for handling customs clearance, dealing with established wholesalers/retailers, marketing the product directly to major corporations or the government, and handling after-sales service. Exporters of services generally also benefit from using a local partner.

Sales to the Government of Malaysia, Government Linked Companies (GLC), or procurements in priority sectors favor local agents and/or a joint venture partners that are classified as a Bumiputra (Malay) company.  The term Bumiputra refers to individuals who are ethnically Malay. A Bumiputra company is defined as a company that fulfills the following criteria:

  • Established under the Companies Act, 1965

  • Paid-up capital of at least RM25,000

  • Shareholders are 100 percent Bumiputra

  • Board of Directors are at least 51 percent Bumiputra

  • Managerial and Professional Staff are at least 51 percent Bumiputra

  • Supporting Staff are at least 51 percent Bumiputra

The Malaysian government and GLCs make use of offsets and other measures to encourage technology transfer, particularly in priority sector procurements. The Government of Malaysia and GLCs also look favorably on U.S. companies that have a long-term presence in the local market.  Therefore, for strategic or large-scale market entry, U.S. companies typically find they are treated more favorably when they are willing to establish a local office, hire Malaysians, engage in training, undertake some amount of local assembly or production, or at least plan regular and frequent trips to maintain relationships and presence.

In sectors that are not government dominated, companies, agents, or distributors should be selected based on competitive considerations (e.g. technical grounds or product knowledge). Since the Malaysian market is a very relationship-oriented market, having a local presence or local agent can influence the final outcome. 

Prepared by our U.S. Embassies abroad. With its network of 108 offices across the United States and in more than 75 countries, the U.S. Commercial Service of the U.S. Department of Commerce utilizes its global presence and international marketing expertise to help U.S. companies sell their products and services worldwide. Locate the U.S. Commercial Service trade specialist in the U.S. nearest you by visiting http://export.gov/usoffices.