A brand-side checklist from 22 years of appointing, contracting with, and occasionally replacing distributors across Asian markets.
Most brands approach distributor selection as a ranking problem. Two or three candidates come in, each with a deck, and the brand tries to work out which company is better.
It is the wrong question, and it usually produces a stalemate. Good distributors are good in different ways. A company that is excellent for a premium skincare launch can be the wrong choice for a mass colour cosmetics brand, and neither fact says anything about the quality of the company.
The right question is narrower: which candidate has the structure this brand needs right now?
What follows is how that question gets answered on the brand side of the table — including the parts that rarely make it into a proposal review.
1. The biggest number in the proposal is the least reliable one
Distributor proposals lead with a sell-in plan: the volume they commit to purchasing from you over the first year. It is the most visible number in the room and the easiest to compare across candidates. It is also the weakest evidence you will be given.
Sell-in is what the distributor buys from you. Sell-out is what consumers buy from them. A commitment to purchase twice as much is not a commitment to sell twice as much — it is a statement of intent, priced into a negotiation.
I have seen two candidates for the same brand come in with sell-in plans nearly a factor of two apart. The gap was real, but it was not the answer. It was the opening of a better question: why can that candidate credibly promise twice the volume?
Answering that question is what actually decides the appointment. In that case the answer was channel structure — one candidate was online-led, the other had national offline coverage in a category where shelf presence is volume. The number was a symptom. The structure was the cause.
What to ask instead of comparing sell-in totals:
- How many doors, of what type, in what sequence?
- What is the channel mix behind the number, month by month?
- Who carries the inventory risk if sell-out lags sell-in?
- What happens at month 7 if sell-through is running at 40%?
A candidate who can answer these has done the work. A candidate who cannot has given you a number, not a plan.
2. Fit is decided by the category, not by the company
Before comparing candidates, decide what channel structure the brand requires. That is a function of category, price tier, and growth stage — not of who is presenting.
- Mass colour cosmetics live on accessibility and shelf space. Volume comes from offline modern trade and national coverage. A brilliant online-only operator will underperform here regardless of how good they are.
- Premium or dermatological skincare needs awareness and credibility before it needs coverage. Content capability, key-opinion-leader relationships, and platform execution matter more than door count.
- A new brand with no local recognition usually needs an online-first entry that can be scaled back cheaply if the market does not respond, then localised once demand proves durable.
Once that structure is written down, the comparison becomes tractable. You are no longer asking who is better. You are asking who has the thing you already decided you need.
This distinction matters for a second reason, which comes up later: it tells you what to say to the candidate you do not appoint.
3. There is no risk-free partner. Ask whether the contract can contain the risk.
Every candidate I have ever appointed came with known problems. In one appointment the issues were explicit before signing: the distributor carried private-label brands competing directly in my category, the working-level team was thin behind a strong CEO, and they had reopened an agreed supply price days after agreeing it.
None of those were disqualifying on their own. The question was whether each could be closed in the agreement.
Package the commercial terms rather than negotiating them separately. Supply price, free-of-charge allocation, and your own marketing investment ceiling should move as one block. Negotiated individually, a counterparty will take the best version of each and leave you carrying the combination. Bound together, the trade-offs stay visible.
Narrow the opening assortment. It is common for only half of a listed range to actually get imported. Starting wide produces unmanaged SKUs and stranded inventory, and it obscures which products are actually working. Open narrow and earn the extension.
Where a distributor holds competing brands, the containment is not a promise of loyalty — it is minimum performance thresholds, dedicated headcount named in the agreement, and review rights on the local marketing plan.
4. Term length is the asymmetry nobody negotiates properly
Distributors ask for long terms, and the request is rational: relationship-specific investment — team, retail listings, launch marketing — needs a recovery period.
But a long term removes your exit precisely in the scenario where you need it. And the more the distributor invests, the more valuable that exit becomes to you, because the relationship gets harder to unwind the longer it runs.
The workable structure is a short initial term with performance-linked extension. It gives the distributor a defensible reason to invest while keeping a door you can walk through if the plan does not hold. Three years with a review-based extension is a reasonable default in most categories. Five and ten-year requests should be read as what they are: a transfer of risk to you.
5. Turn a one-off contract into a repeated game
A distributor negotiating a single deal has every incentive to extract maximum terms now. A distributor who believes more business follows behaves differently, because reputation becomes an asset with value.
If you have a pipeline — another brand, another category, an adjacent market — putting it on the table changes the negotiation without changing a single commercial term. It does not need to be stated explicitly. It needs to be understood: performance on this brand determines whether there is a next one.
This is the cheapest leverage available in a distribution negotiation, and it is routinely left unused.
6. The pre-screen that filters most candidates
Before the full evaluation, a short profile request removes most unsuitable candidates in a week:
The last two items are where most candidates stop. Enthusiasm is common; the operational history to clear customs and registration is not. Asking for it early is the single highest-yield filter in the process, and it costs you nothing to ask.
7. How you say no is part of the evaluation
The candidate you do not appoint is not gone. Partner pools are small, markets are narrow, and people move between companies. The distributor you decline this year can be your only viable option in an adjacent market next year.
Two things matter.
Timing. If the decision is effectively settled, waiting for the formal process to deliver the news is not discretion — it is avoidance. A candidate who has already assigned a brand manager and put them on hold is spending real resources while you wait for a calendar. Tell them before the process does.
Content. Give credit first, and only where it is factually deserved. Give one reason, and make it structural — the brand needed a channel structure they do not have — rather than a critique of them. Acknowledge what they have already invested. Offer a call. And do not disclose the comparison: the reasons for a decision should be honest, but the process of the decision stays private. Telling a declined candidate how they scored against another candidate helps nobody, leaks negotiating information, and invites an argument.
Handled this way, a decline is not the end of a relationship. In one case the declined partner came back inside the same conversation with an unrelated introduction in a third market. That is not luck. Predictability is a form of trust, and it compounds.
The five-line version
Your turn
- Are you asking which candidate is the better company, or which one has the structure your brand needs?
- Have you verified what sits behind the sell-in number — doors, channel mix, inventory risk — or did the comparison stop at the size of the number?
- For each known risk in your preferred candidate, can you point to the clause that contains it?
- The last partner you declined: did they hear it from you, or from a process?
Written from the brand side of this table — twenty-two years appointing and managing distribution partners across Asian markets, across categories and price tiers.