1) Finding Unique, Useful and Quality Products. Our primary goal as a company is to serve the needs of the electronics design and test engineer. To do this effectively, we must constantly evaluate new supplier line card opportunities. Our goal is to find products that everyone needs, is unique to North America, that are easy to ship, and which require minimal ongoing technical support. Imported products need to have a uniqueness, rather than just being “me-too”. This typically means a product that’s high quality, lower in price than most, and with features presently unavailable domestically. We evaluate in a “hands-on” fashion almost all the products we sell upfront, to assess its usefulness to our customer base, and to enable our tech support team to answer questions intelligently. This also helps us to exclude hard-to-use products, or ones with inadequate instructions or manuals. Analysis of competing product features/pricing is also essential. Finding that “killer” new product takes constant global market research. Making sure a product is suitable for the domestic marketplace (power supplies, correct broadcast frequencies, etc.) is essential. Increasing numbers of returns and failures should trigger a reassessment of the business case for relevant products.

2) Entering into Win-Win Supplier Partnerships Finding and evaluating trustworthy, reliable global suppliers is a constant challenge, especially since a typical electronics component distributor cannot usually visit each supplier before business decisions are made. A consistent, comprehensive supplier evaluation process can help determine if products are easy to use, able to be delivered promptly, whether tech questions can be answered quickly and accurately, whether products are reliable and of high quality, etc. Supplier partnerships need to be mutually beneficial and trustworthy. For example, upon signing exclusive North American distribution agreements, we would anticipate a supplier forwarding inquiries and sales to us, not bypassing us and selling direct, and also standing behind their products when there are quality and reliability issues.

3) Finding and Maintaining Good People/Facilities Choosing the right supporting team is also essential to presenting efficient, honest, knowledgeable service to customers and suppliers, as is having a well-maintained office infrastructure and networked equipment. Providing employees with a secure opportunity to earn a livelihood, with the flexibility to pursue personal growth needs must also be balanced with consideration and accommodation to employees for individual family or other personal needs, as they arise. Successful distributors treat both customers and employees with the same level of care and consideration.

4) Positioning Products to Customers Having already identified the ideal target end customer as electronics design engineers, finding the correct venues for product placement and publicity are critical. Advertising and press release distribution are essential, and require constant awareness of an evolving print and online media world. Securing commitments from overseas suppliers to invest in advertising and promotion is always a challenge, as they frequently think this should be totally shouldered by the distributor, but that is tough to do on small margins that get eroded with credit card fees, shipping and duty payments and stock costs. Because of the North American market size, domestic distributors may be unable to visit most customers in person. Instead, they need to be able to sell products via strong technical support, ease of ordering and shipment, good marketing, and good web support for the products. It’s also important to have and exercise effective customer-retention strategies. For example, Saelig regularly emails our large customer base with relevant and timely new product information. The most promising prospects to interest in new products are customers we already have and know, who have past positive experience with us, and who have continually placed their trust in us to help them find the newest and most useful products.

5) Entering into Mutually Beneficial Agreements It is essential to have signed agreements in place, not just to protect business and legal interests, but also to clearly set forth the responsibilities and expectations of both distributor and supplier. It is also vital to include a highly specific termination clause. The ability at termination to return for reimbursement any remaining stock can be a life-saver to any distributor!

6) Managing Finances International currency fluctuations present a whole host of other issues. Many goods are purchased with payment in advance in a given foreign currency, and the time between issuing a formal price quote and subsequent receipt of customer funds to pay for the goods can be up to 3 months, during which time there may be a slight, or significant variation between paid price and funds received. Credit card fraud is another factor. Overseas webshop sales with foreign credit cards do not yield useful enough verification data in determining whether a credit card is genuine. Delicate judgment is needed when deciding whether to fill an order. In addition, credit card “discount” fees can be 2 to 6.5% of total sale value, depending on card type, so a revenue reduction of up to 6.5% needs to be considered when pricing products.. Another challenge is keeping pace with price changes from hundreds of suppliers, and to keep online webshop and internal accounting software prices current. Cash flow can also be a problem. Customers often pay Net 30 invoices late, requiring companies to chase payment. Yet in Saelig’s case, we buy on Net 30 terms and pay promptly – many times earlier than Net 30. This means there are 15 or more days for which a cashflow deficiency can exist. Increasing business revenue therefore needs increasing cash to sustain, possibly requiring a bank loan. Having a good banking relationship is essential for times when a quick loan may be needed to assist with cash flow.

7) Understanding the Importance of Good Technical Support Answering technical questions about products, both before and after the sale, is vital to successful importing and electronics distribution. In-depth technical questions need to be deferred to the supplier for handling, though a distributor’s initial advice can be the key to sales. Keeping current on product specifications from more than 100 companies is difficult, to say the least!

Shipping/customs It is also essential to have a thorough understanding of the costs and procedures associated with shipping and customs handling. This may involve extra paperwork, forms, and evaluating alternative shipping and freight forwarding options. Saelig certainly has gotten to know well our own local UPS, DHL and FedEx reps!

9) Knowing Success may also sometimes bring failure Any electronic distribution is faced with the fact that if we are to do our Sales and Marketing job “too well”, with record sales and qualified lead generation, a supplier will see a real local market and will typically terminate a distribution contract, in favor of going direct. This is a common industry phenomenon, though it does not mean we try less, however; on the contrary, it is rather a ‘feather in our cap’, as it illustrates to other prospective suppliers our effectiveness in the marketplace.

10) Evaluating Processes. Tools and processes for doing business are ever-changing, with new technologies and process efficiencies Distributors need to keep evaluating in-house activities for inefficiencies, operational improvements, product/supplier performance and customer feedback. Any overall change in the global economy requires careful assessment and balancing of resources.

11) Managing Risk Balancing risk with reward is a constant challenge for distributors, with Saelig as no exception, with 100 supplier lines to sell and support. Judging which and how many products to stock can be a tricky process, with some inevitable level of guesswork. At Saelig, we base decisions on recent stock turnover, as well as anticipation of known future preordered deliveries.

12) Unwavering Ethics/Integrity Saelig is committed to doing what is right, even when it does not seem to be profitable, expedient, easy, or conventional. We take note of the thoughts in the Bible recorded in Proverbs 22:1 “A good name is more desirable than great riches; to be esteemed is better than silver or gold.” There have been times when a supplier has refused to take back product, which our customer deemed faulty, and we lost money in the refund, but kept our good name. There are also examples where customers may have returned product deemed to be faulty, for which a failure analysis revealed customer misuse as the concluded cause of failure. In those instances, we take the standpoint of “the customer is always right”, and return the product for a refund, though inevitable, we have again lost money. We find that there are few customers who abuse such customer service policies. With unwavering ethics and integrity, we’ll do what is best for the customer, knowing that in doing so, we have stayed true to our core values – which, ultimately, will form the cornerstone for our growth and success.