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Distributor, agent, reseller or direct?
The main decision is who buys and holds your stock in Australia. A distributor buys your products, holds stock, resells to dealers or end customers and usually handles local service. An agent finds buyers and earns a commission, but the customer buys from you. The US Government’s commercial guide to Australia notes that success often requires a local sales presence with after-sales support, which for many exporters means a qualified distributor and sometimes an agent.
| Model | Who holds stock and customers | Your control | Usually suits |
|---|---|---|---|
| Distributor | The distributor buys, stocks and invoices customers | Lower; set by the agreement | Products needing local stock, installation or service |
| Agent | You sell and ship; the agent earns commission | Higher; you set prices and terms | Large, infrequent orders such as equipment or projects |
| Reseller or dealer | Buys smaller quantities, often through a distributor | Low; many small accounts | Wider coverage once a distributor is in place |
| Direct | You, or your own Australian company, import and sell | Full, with full responsibility | A few large customers, or a brand ready to invest locally |
Many manufacturers start with one distributor and add direct sales later. Either way, decide early who will be the importer, because in Australia the importer carries product obligations, covered below.
How to find and shortlist partners
Look for companies that already sell to your target customers, ideally with complementary rather than competing products. Useful places to look:
- Industry associations for your sector, many of which list members and run events.
- Trade shows in Sydney and Melbourne, where distributors exhibit the brands they carry.
- Importer research: check the labels, websites and catalogues of similar brands to see who imports them, and what else those companies carry.
- Referrals from customers, freight forwarders, customs brokers and non-competing suppliers already selling in Australia.
Austrade, the Australian Government’s trade and investment agency, mainly helps Australian exporters and international investors, and connects international buyers with Australian producers. If you plan to invest in Australia, its advisers can help with opportunities and contacts, but do not expect it to find a distributor for you.
Aim for a shortlist of three to five, ask each for a short plan for your product and visit before you sign; the US guide advises exporters to expect regular visits to meet partners and show commitment. If you need help finding and approaching candidates, our marketing and lead generation service covers prospecting and follow-up.
Due diligence before you sign
Check a candidate as carefully as a large customer: a distributor will represent your brand and may hold your stock and customers for years.
- RegistrationConfirm the company’s ABN (Australian Business Number) on ABN Lookup and its details on ASIC’s registers, and that the names match the contract.
- Financial standingAsk for supplier references and consider a credit report before offering credit terms.
- CoverageWhich customers, industries and states they actually serve, and with how many sales staff.
- ConflictsWhether they carry a competing brand, and what happens to it if they sign with you.
- CapabilityWarehousing, technical support, warranty handling and the ability to manage compliance as importer.
- Track recordSpeak to two or three brands they represent now, and one that left them if you can.
What a distribution agreement usually covers
A written agreement sets the rules both sides rely on when things go wrong, and usually covers:
- Territory: certain states, all of Australia, or Australia and New Zealand together; the US guide notes all three are negotiated.
- Exclusivity: whether the distributor is your only partner there, and whether you keep named key accounts or online sales.
- Targets: minimum purchases or sales, and what happens if they are missed, such as losing exclusivity.
- Prices, orders and payment: currency, Incoterms and who pays freight, duty and import GST.
- Marketing support: who pays for samples, trade shows, translated materials and advertising, and how your trade marks may be used.
- Compliance, warranty, recalls and product liability: who is the importer and who handles claims.
- Term and termination: length, renewal, notice, and what happens to stock, customer lists and trade marks at the end.
Have an Australian lawyer review the draft, particularly the exclusivity, pricing and termination clauses, which need to work under Australian competition and consumer law. Register your trade mark in Australia yourself, through IP Australia, rather than leaving it to a partner.
Product compliance before you ship
Check compliance before the first shipment, not after a container lands. Business.gov.au explains that mandatory safety and information standards, bans and recalls are law, and that suppliers include importers, distributors and manufacturers. Examples to check:
- Electrical equipment designed or marketed for household, personal or similar use and rated 50 to 1,000 volts AC or 120 to 1,500 volts DC falls under the Electrical Equipment Safety System (EESS). Energy Safe Victoria explains that the responsible supplier, an onshore manufacturer or importer, must register itself and its Level 2 and Level 3 equipment, and products must carry the RCM (Regulatory Compliance Mark).
- Importing industrial chemicals for commercial purposes, including in products such as some paints, glues, soaps, cosmetics and cleaning products, requires registration with AICIS (the Australian Industrial Chemicals Introduction Scheme).
- Some imported goods need a trade description label stating what they are and where they were made, and imported food labels must meet the Australia New Zealand Food Standards Code.
- Most imports attract 10% GST on top of any customs duty and charges, and some goods need permits or biosecurity clearance.
Your Australian importer, whether a distributor or your own local company, takes on legal obligations for your product, so a capable distributor will ask for test reports and certificates early. Our certification and compliance service coordinates product testing and registration with accredited laboratories and bodies.
When a local presence makes sense
A local presence makes sense when you want to be the importer yourself, sell direct to key accounts, hold stock or support a distributor closely. The US guide notes that, given Australia’s size and distance from trading partners, Australian firms stress local support and service.
Options range from a local representative to an Australian company with its own ABN and GST registration. A local company can import, hold stock and sign contracts in Australia, but brings bookkeeping, tax and reporting obligations.
Our Australia operations service handles company setup and local operations, with bookkeeping, tax and payroll coordinated through licensed local partners.
Questions
How do I find a distributor in Australia?
Start with companies that already sell to your target customers. Use industry associations, trade shows, research into who imports similar products, and referrals from customers, freight forwarders and other suppliers. Shortlist three to five, check each one’s registration, finances, customers and capability, and visit them before you sign an agreement.
What is the difference between a distributor and an agent?
A distributor buys your products, holds stock and resells them, so it carries stock and credit risk and controls the customer relationship. An agent finds buyers and earns a commission, while customers buy directly from you. Distributors suit products that need local stock or service; agents suit large, infrequent sales such as equipment.
Should an Australian distribution agreement include New Zealand?
It can. Agreements for Australia may cover certain states, the whole country or New Zealand as well. Include New Zealand only if the distributor shows real coverage there, such as staff, customers or a logistics partner. Otherwise leave it out, or make it conditional on targets, so the market is not tied up and unused.
Do overseas manufacturers need an Australian company to sell in Australia?
Not always. Many sell through an Australian distributor that acts as importer. A local company becomes useful when you want to import and hold stock yourself, sell direct to key accounts, or carry obligations that sit with the onshore importer, such as being the responsible supplier for in-scope electrical equipment.
What product approvals do I need before exporting to Australia?
It depends on the product. Check mandatory safety and information standards and bans, which bind importers and distributors too. Household electrical products generally fall under the Electrical Equipment Safety System, which requires a registered responsible supplier and the RCM mark. Importers of industrial chemicals need AICIS registration, and imported food labels must meet the Food Standards Code. Certification & Compliance
Can Austrade help me find an Australian distributor?
Austrade mainly helps Australian exporters and international investors, and connects international buyers with Australian producers. If you plan to invest in Australia, its advisers can help with opportunities and contacts. To find a distributor, overseas sellers generally rely on industry research, trade shows, referrals, their own country’s trade offices or private advisers.
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