Be careful about Exclusive distribution rights..
One fine day, I got a call from a businessman whom I know earlier. We had some technical discussions earlier, when I was a part of a some other company. He wants to be my dealer for one of my product. He promised me that he will purchase 1k units every month. That was quite a large number at that point of time. I was discussing with some other guy, (we will call him Mr. X) at the same time, for a lesser quantity, from my friend’s country. As he was the first guy who started the discussion, I told my friend that I can commit only if Mr. X says no. I called Mr.X and told him that I need an answer without delay, thinking that my friend is a better choice. By that day evening, Mr. X called and finalised the deal for 500 units. I felt bit disappointed. But I need to follow my business ethics.
I called my friend and informed him about this. I was really confused when he tried to convince me with numbers. He promised me that, within next 3 months, he will be able to pickup 3k units. I remembered my mentor’s phrase, which I have told him ‘We only marry once’.
After a month’s time, Mr.X ordered 15K units together. We had done a business of more than 40K units within that 3 months.
My friend(?) was dealing with my competitor’s product !!
In my experience, you have to be always alert. This guy wants me to stop us for three months where the huge business volume was expected. He will simply make a contract for exclusive rights and buy 1k units and stop buying from me. If I insist, he might order another 1k from me after 2 months.Within that time, he will sell maximum number of his product.