The five-step process for authorizing overseas agents for machinery and equipment is as follows: ① Qualification Review (business license/registration number/customer reputation; verification takes 24–48 hours); ② Signing the Letter of Intent (LOI) (clarifying cooperation intent and basic terms: territory, exclusivity, products, and minimum purchase commitments); ③ Formal Contract Negotiation (pricing structure, order processing, market support, and commissions); ④ Signing the Formal Agency Contract (legally binding authorization); and ⑤ Training and Market Development (product training and implementation of market support). The “LOI → Formal Contract” two-step approach is the industry standard (used by manufacturers like Meisiboer and Hengfeng Shuai for their global agency processes).
I.
Qualification Review First
Review Content: Registered company name, registered address, registration number, operating status, and industry experience; Tools: Target country’s business registry system + third-party due diligence platforms (e.g., GTsetu, utilizing government data verification); Telephone Verification: Contacting existing suppliers or customers; Video Conference: A 30-minute discussion on cooperation (market conditions, target customers, and estimated monthly sales volume)—the “check registration + phone call + video conference” triple-check process prior to authorization prevents shell companies from fraudulently obtaining authorization.
II.
Letter of Intent (LOI)
Content: Nature of agency (sales agent, exclusive, or non-exclusive), product scope, territory, minimum purchase/sales target commitments, pricing framework, and term/duration; Purpose: To lock in basic terms before negotiating details; Note: While the LOI is not a formal contract, it demonstrates sincerity—it serves to nail down the three key frameworks of “territory, exclusivity, and minimum purchase” before moving on to price, commission, and market support negotiations.
III. Formal Agency Agreement
Use registered entity names (do not use brand or group names; the legal entity handles invoicing, liability, and execution); define territory precisely (list countries, states, or industries; ensure no overlaps or gaps); specify exclusivity terms (link to annual purchase volume, payment collection, and market investment; clearly state conditions for losing exclusivity); pricing structure (agent price/distributor price/retail price + price adjustment notification); commission (percentage/calculation basis/payment trigger—e.g., within 30 days of receiving payment);
termination clauses (breach of contract/territory revocation due to failure to meet sales targets)—Eight key contract elements: parties, territory, exclusivity, pricing, commission, after-sales service, termination, and dispute resolution.
IV. Letter of Appointment
Purpose: For the agent to prove authorization to customers, customs, or government agencies; content: legal names and registration numbers of both parties, nature of authorization (exclusive/non-exclusive), product list (models), territory, validity period, and authorized activities (importing, distributing, registering, marketing, responding to official inquiries);
format: bilingual (Chinese/English) with official seal and signature—The Letter of Appointment serves as the agent’s external “ID card” (required for customs clearance, bidding, and local registration; specify a validity period to prevent misuse).
V. Training and Launch
Product training: Technical specifications, operation, and after-sales system training (provided free of charge); market support: promotional materials, trade show support, and demo unit policies; CRM setup: order system access, quoting privileges, and dedicated communication channels;
initial order: introduce the first batch of leads within 14 days (refer to the ExcaYard agent launch process)—The “training + materials + first order” trio gets the agent up and running after authorization.
