Middleman / Intermediary

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📖 Detailed Explanation

In foreign trade, a middleman (or intermediary) refers to a third party who does not directly produce or consume goods, but earns commissions or price differences by matching buyers and sellers, providing information or services. Common types include commission agents, agents, distributors, and brokers. Usage scenarios: When exporters lack overseas channels or importers are unfamiliar with the supply market, middlemen can help match demand, negotiate, handle documents, or logistics. Precautions: Clarify the middleman's legal identity (agent or principal) to avoid unauthorized signing; commission rates, payment terms (e.g., 2%-5% of invoice value), and exclusivity clauses should be written into the contract; also pay attention to confidentiality agreements to prevent the middleman from leaking business information. Difference from 'agent': An agent usually acts in the name of the principal, while a middleman may buy and sell in their own name and bear risks; Difference from 'distributor': A distributor buys goods outright and resells them for a profit, while a middleman often does not hold inventory. When choosing a middleman, verify their qualifications and reputation, and consider the possibility of direct transactions.

📝 Examples

1. We found a European buyer through a middleman in Hong Kong. He helped us negotiate the price and payment terms, and we paid a 3% commission on the invoice value. (Note: The middleman facilitated the transaction, and the exporter paid the commission.) 2. Since the middleman represented both the buyer and the seller, we asked him to disclose the final customer information, but he refused citing a confidentiality agreement, preventing us from directly contacting the end user. (Note: The middleman may hide the end customer, hindering direct transactions.)

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