Includes typical use of agents and distributors and how to find a good partner, e.g., whether use of an agent or distributor is legally required.
Last Published: 8/1/2019

Local agents normally work as an exporter's sales representative on a commission basis, with the size of the commission varying based on the nature of the product or service being offered.  Specific responsibilities depend on the terms of the contract.  The Embassy’s Political/Economic Section are happy to provide specific market and general business environment information to potential exporters, and also make relevant connections where possible.  In March 2018, Embassy Kathmandu became an official Partner Post of the U.S. Foreign Commercial Service (CS) in New Delhi.  CS India is responsible for commercial issues in India, Nepal, Sri Lanka, and Bangladesh and for assisting U.S. companies looking to export their products and services to these markets.  A number of business services/programs, some fee-based, are provided under this Partner Post arrangement, including connecting U.S. businesses to local companies of interest that could include buyers, agents, distributors, sales representatives, and other strategic business partners.  Requests for these services can be directed to one of our U.S. Export Assistance Centers (www.export.gov/usoffices) or to the CS New Delhi office (office.newdelhi@trade.gov).

In some cases the agent also buys and keeps goods in stock for resale, does local marketing, and handles after-sales product servicing as required.  The distributor usually works on a profit margin, so the commission rate and responsibilities (pricing, advertising, market promotion, after-sales service, etc.) should be clearly defined in the contract.  The distributor's commission in Nepal normally ranges from 15 to 30 percent, again depending upon the nature of the product.  Use of a local distributor is more effective when selling consumer goods.

Hiring an agent to assist in winning a contract can be effective when selling infrastructure-related goods, such as construction services or heavy equipment to government agencies, or when competing in an international tender offer.

Due diligence on any potential distributor/agent is essential prior to entering the local market.  Given the prevalence of corruption in Nepal, exporters are urged to carefully screen any potential agents working on their behalf.

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.