Insurance

Part 1

DIALOGUE 1

Paula Williams runs the Export Sales Department of Mercury Com­puters Ltd. Her assistant, Bob Seagrum, has just joined the firm. Paula talks to Bob about insuring a consignment of goods for South America.

PAULA Here's an interesting letter, Bob. It's from a customer in Colombia, Mr Carrera. Do you remember him?

BOB Yes. What does he say?

PAULA Let me put you in the picture, first. A few weeks ago Mr. Carrera bought some of our microcomputers. Now he's written to say he'll be placing regular orders with us.

BOB That's good. We don't sell much to South America at the moment, do we? It'll give us a foothold in the market.

PAULA Yes. I hope it'll be the start of something quite big. Carrera doesn't just do business in Colombia. He's got sales outlets in Venezuela and Ecuador as well.

BOB Just the kind of contact we need, then.

PAULA Definitely. The orders will be fairly large — about three to five thousand pounds (£3—£5,000) worth a month. Carrera wants us to arrange insurance cover for the shipments.

BOB So the invoices will be made out CIF, won't they?

PAULA Yes, CIF Caracas. Mr Carrera will airfreight the goods from there to Bogota, or perhaps bring them overland.

BOB How do we go about getting insurance? Is it tricky?

PAULA Oh, not really. We'll be sending computers regularly to Colombia. So. we'll take out an all risks open policy for, say, fifty thousand pounds (£50.000). It’ll cover consignments from our warehouse to the port of destination - Caracas.

BOB I’m afraid 1 don't know much about insurance terms. What is an all risks open policy?

paula It's a policy that'll cover all consignments made to Mr Carrera over a twelve-month period. Up to a value of fifty thousand pounds (£50.000).

BOB Yes, but what about the ‘all risks’ bit? Can you explain precisely what it means?

paula It means all risks mentioned in the policy.

BOB Such as?

paula Fire, theft, damage of various kinds, like breakage.

BOB I see. To take out an open policy, I suppose we phone our insurance broker.

paula Right. We contact our broker. Then he gets in touch with a Lloyd's¹ underwriter. It's the underwriter who quotes a rate for the shipment and issues the Insurance Certificate. And it's the broker who collects the premium.

BOB If we agree to the rate, are all shipments immediately covered?

paula It works like this. While the policy is being prepared, the broker sends us a Cover Note. As soon as we get that, our consignments are insured.

BOB Mm, there are also some Declaration Forms to fill in, aren’t there?

paula Ah, so you do know something about insurance, Bob! Yes, each time we ship goods, we sign a Declaration Form and send a copy to the broker. It provides a record of each insured shipment.

BOB It sounds fairly simple, this insurance business.

paula Oh, it's dead easy, once you get the hang of it.

Answer the questions:

1. What is Paula’s position in the company?

2. What problem is she discussing with her assistant?

3. Why is Mercury Computers LTD interested in doing business with Mr. Carrera?

4. How large are the orders going to be?

5. How will Mr. Carrera deliver the goods?

6. What kind of policy are they going to take out? Explain their choice.

7. What risks are mentioned in the policy?

8. What is the procedure of taking out the policy?

9. When are the consignments insured?

10. How is the record of each insured shipment provided?

PART 2

DIALOGUE 2

An Italian importer, Mr. Mazzi, telephones Miss Scott, manager of a British firm supplying typewriters.

SCOTT Hello?

MAZZI Hello. This is Mazzi here. Gennari Import Agency. I'm calling about, the consignment of typewriters you've just sent us.

SCOTT Before you go any further, Mr Mazzi, could you tell me the order number, please?

MAZZI Oh, I'm sorry. It's PT two-six-o (260).

SCOTT Thank you. I'll just note that down. Now then, what's the problem?

MAZZI I'm afraid there's been a great deal of damage to the goods. I'd say the consignment is a complete write-off. We can’t salvage anything.

SCOTT Really? What on earth happened?

MAZZI We're not absolutely sure. When we received it, the case was badly crushed. All the machines were damaged beyond repair,

SCOTTMm, sounds as if something heavy fell on it. Another con­signment probably. You'd better get the surveyor to inspect the case right away.

MAZZI I've already done that. It didn't take him long to carry out his investigation. The machines were in a terrible state — bits and pieces everywhere.

SCOTT That's bad. Would you mind sending the surveyor's report to me personally, please? You could forward it with your claim. I’ll take the matter up with our insurers.

mazzi It's going to be a pretty big claim, you know. Well over ...

SCOTT I realise that, and I assure you we'll try to speed things up for you at this end. You must be compensated without delay.

mazzi Thanks. That's very good of you. But we still need replace­ment machines. We can't keep our customers waiting.

scott No, of course not. We'll despatch another ten machines to you by the end of this week. I'll telex you as soon as we have shipping details.

mazzi Fine. Let's hope this consignment is handled more carefully.

scott It had better be, or else I’ll start sending our goods by air —

even if it does cost a lot more.

mazzi Oh, I'm sure it won't come to that. Let's keep our fingers crossed and hope for the best.

scott Well, sorry for all the trouble. Goodbye, Mr. Mazzi.

mazzi Ciao.

Answer the questions:

1. What is Miss Scott’s occupation?

2. What is she discussing on the phone?

3. What happened to the consignment of typewriters?

4. How were the goods damaged?

5. Why was it necessary to get the surveyor?

6. What did the investigation of the surveyor show?

7. Why was it necessary to send the surveyor’s report to Miss Scott?

8. How will the compensation be provided?

9. Why will another ten machines be despatched to Mr. Mazzi? What are they called?

10. Why is Miss Scott thinking of sending the goods by air?

ex.1.Insert the necessary prepositions.

1. We’ll give you a large discount __ the goods if you intend placing regular orders __ our company.

2. We have been doing business __ “Black & C” for 5 years and they have never let us __.

3. Our company will take __ an all risks open policy.

4. The assistant of the Export Manager has just joined the firm and it was necessary to put her __ the picture first.

5. Insurance business seems very difficult at first, but you’ll soon get the hang __ it.

6. The consignment was badly damaged during transportation and now it is a complete write- __.

7. It’s rather a tricky situation and I would like you to take the matter __.

8. The company is having financial problems and can go bankrupt. I don’t think that it will come __ that. Let’s hope __ the better.

ex.2.Paraphrase the following sentences using your active vocabulary.

1. He is always extremely tired after work.

1. I hope that things will turn out well.

2. The situation is rather complicated.

3. Are you going to transport your goods by air?

4. Let me give you the essential facts of this matter.

1. Insurance business is very easy once you understand how to do it.

2. We couldn’t save any goods from the damage.

3. They asked the surveyor to examine their goods.

4. He should be paid for the loss immediately.

ex.3.Translate the following sentences into English.

1.Пока готовится страховое свидетельство, страховой маклер посылает нам временное свидетельство о страховании.

2. Нет ничего проще страхового бизнеса, как только Вы поймете, в чем суть дела.

3. Если он будет регулярно размещать у нас заказы, это позволит нам занять нишу на их рынке.

4. Страховой агент назначит процентную ставку и выдаст страховое свидетельство.

5. Ящик сильно продавлен, и все оборудование повреждено до такой степени, что ремонт немыслим.

6. Перешлите мне заявку на возмещение ущерба и отчет контролера, а я попрошу заняться этим наших страховых агентов.

7. Декларации обеспечивают учет каждой застрахованной перевозки.

8. Вам будет отправлена замена поврежденного оборудования к концу недели.

9. Вся партия товара в ужасном состоянии – все разбилось вдребезги.

10. Давайте пожелаем друг другу удачи и будем надеяться на лучшее.

ex.4. Read the following statements. Say whether they are true, if not correct them.

1. Getting insurance is very tricky.

2. An all risks open policy covers all consignments over a certain period up to a certain value.

3. If a company wants to arrange insurance cover for a big shipping consignment they contact the underwriter.

4. The broker quotes the rate of the cost and issues the Insurance Certificate.

5. The underwriter goes to the broker to collect the premium.

6. Before the policy has been prepared you receive a Cover Note.

7. As soon as you get the Insurance Certificate your goods are insured.

8. If there are many shipments you fill in a Declaration Form each time.

9. A Declaration Form is sent to the underwriter.

10. If your goods were damaged during transportation you’d better get the surveyor to inspect the case right away.

11. In case the consignment is badly crushed the Buyer can be compensated or have replacement goods.

Read and translate the following text:

The export trade is subject to many risks. Ships may sink or consignments may be damaged in transit, exchange rates may alter, buyers default or governments suddenly impose an embargo.

Exporters can insure themselves against many of these risks. The cover paid for will vary according to the type of goods and the circumstances: delicate goods, such as breakable crockery, cotton piece-goods or perishable foodstuffs, obviously have to be covered against more risks than sturdy articles like steel girders.

Regular shippers may take out a floating policy which gives automatic cover for a fixed maximum value of shipments, based on the previous year’s trade, provided each shipment is declared when made. Open cover is an even more flexible type of insurance, limited to twelve months, at agreed terms and rates. In both these cases a certificate of insurance is issued instead of a policy. Aviation insurance follows marine insurance very closely, but on the whole is much cheaper.

There are some risks, however, that cannot be covered by normal insurance. Fluctuations in exchange rates may be overcome by buying or selling forward exchange, but against the actions of government, like embargoes, a shipper can only protect himself by making special arrangements with his own government; in the U.K. this is done through the Export Credit Guarantee Department.

Answer the questions:

1. Name some risks to which the export trade is subject.

2. Against which of these risks can exporters insure themselves through insurance companies?

3. What is a floating policy?

4. When is a certificate of insurance issued instead of a policy?

5. How do you cover yourself against fluctuations in exchange rates?

Find out which definition on the right matches which word on the left. Decide which word goes in which gap in the passage below.

a. premium 1. A person who advises on insurance

b. underwriter 2. A document which proves you are insured

c. insurance company 3. Payment for insurance

d. broker 4. Insurance protection

e. claim 5. A form you fill in when you apply for

insurance

f. compensation 6. An insurer at Lloyd’s of London

g. small print 7. A limited liability company selling cover

h. policy/insurance certificate 8. The conditions and clauses in a document

i. proposal form of insurance, usually in small print

j. cover 9.You are paid ...... when your insured

property is damaged

10.A request for payment when your

insured property is damaged

Mr Bean wanted to insure his shop. He wanted………….against fire and theft. He filled in the……….and sent it to his………..who arranged the insurance with an…………Mr Bean had to pay quite a high…………each year, but it was worth it because a lot of goods were stolen. Mr Bean put in a ………..for…………Unfortunately the………..refused to pay him the full amount. Mr Bean had not read the……….in his…………properly.

ROLE PLAYS.

1. You are going to insure your cargoes, but your Managing Director thinks it is a waste of money. Try to persuade him.

2. Your consignment has been damaged beyond repair. Telephone your supplier and settle the problem.

Problem-solving

You are an independent insurance agent and your business has not been doing well recently. You are called to investigate the damage after a factory fire and you are not convinced that the fire was accidental. The factory owner has been talking to you about recommending a friend to take out a lucrative new policy through you. What would you say? What would be possible consequences both of speaking and keeping quiet?

Answer the questions on the topic:

1. Why do businessmen insure their goods?

2. Do you know how the insurance business started?

3. What types of insurance contracts do you know? When and why are they used?

4. What should be done to insure goods?

5. What should be done to be compensated without delay?

Unit 7

Marketing

PART 1

DIALOGUE 1

Mike and Hazel Connors manage a home and garden equipment company. For many years, one of their best customers has been a Swedish buyer, Inge Svenson. She runs a buying office located in London. The office purchases goods for many of the major Scandinavian stores.

INGE Your company's done well in Sweden this year. You must be pleased with the way things are going there.

MIKE We're fairly satisfied on the whole. Our volume of sales has been quite high — thanks to you, Inge.

INGE We've bought a lot from you, it's true. But let's face it, you've got the edge over your competitors. Your garden tools are the best on the market.

HAZEL Thanks, that's a compliment. Mike and I believe quality's important. If you've got a good product, the customer won't worry so much about the price.

INGE Uh-huh, your policy's paid off in our market. You're doing very nicely in Sweden. But you could be doing even better. If you used a different method of selling . . .

MIKE What's the point of changing anything? We're doing all right at the moment.

HAZEL Yes, our sales operation is working like clockwork.

INGE I know what you mean, Hazel. You've got a simple system for reaching the market. Basically, you use two methods. Either you sell to my office in London, or directly to certain stores in Stockholm and Malmo, right?

MIKE Exactly. What's wrong with that?

INGE Look, I’ d like to say something to you — off the record — if you don't mind.

MIKE I thought you were leading up to something. OK, whatever you say, it's between these four walls.

INGE I just want to say, it's time you changed your sales approach. You could be doing three times as much business as you are now.

HAZEL Oh? In what way should we change?

INGE Well, using buying offices and direct selling are OK, I suppose, but you're not reaching all your potential cus­tomers that way. You're only covering two areas in Sweden, Stockholm and Malmo.

HAZEL Are you suggesting we should set up a marketing operation in Sweden? Open up a sales office or something. I 'm sorry, we don't have the capital . . .

INGE Hold on, now! Of course I’m not suggesting that. It would be far too expensive.

HAZEL So?

INGE I'm suggesting you develop some kind of sales network there, or use an agent to distribute your products.

MIKE An agent, or dealer network, you mean?

INGE Let me tell you what I have in mind. Then, I'd like to make a proposal to you.

MIKE Ah! I knew you had something up your sleeve, Inge. Now, we'll find out what it is!

Answer the questions:

1. What company do Mike and Hazel manage?

2. How can you characterise their garden tools?

3. What do you know about Inge Svenson?

4. What gives the company the edge over their competitors?

5. In what case won’t the customer worry much about the price?

6. What system for reaching the market do they have?

7. How many methods of selling does the company use?

8. What are these methods?

9. What does Inge suggest?

5. 10. Why is the suggestion reasonable?

PART 2

DIALOGUE 2

Mike and Hazel Connors have just returned from Sweden. They went there to look for a suitable agent or dealer to distribute their products in that market. Here, they are talking to their Sales Manager, Ralph Harris.

hazel The problem is, Ralph, we can't make up our minds. We made an interesting contact in Stockholm. He seems to have a lot going for him, but we're still not absolutely sure if he's the right person for us.

ralph Tell me about him. Maybe I can help you decide.

hazel OK then. We met this man Sven Johansen. Actually Inge Svenson put us on to him. She said he was the ideal person for us.

ralph Interesting. She knows about him, does she?

hazel Yes. The two of them arc close friends.

ralph Uh-huh. What about the background of this Sven Johansen?

hazel He's the manager of a large garden equipment store in the centre of Stockholm. Been in charge for over fifteen years. Extremely successful. Everyone said he's a first-rate manager. And a born salesman.

ralph Why does he want to get out of the business? Getting bored?

hazel Right. He said he wanted a change. He was looking for a real challenge. Something that would give more scope for his abilities.

ralph Obviously the ambitious type. Nothing wrong with that.

hazel Of course not. Sven Johansen made a proposal to us. I'll let Mike tell you about it. Go on, Mike.

mike All right then. Sven suggested we make him our sole distri­butor in both Sweden and Norway.

ralph Ah, an exclusive dealership.

mike Yes. He would be a sort of importer wholesaler, hold­ing stock for us and distributing throughout the two countries.

ralph What about payment? The usual thing, commission on sales?

MIKE On the contrary. He wants to buy and sell on his own account. He hoped we'd give him a discount of twenty per cent (20%) off list prices on all purchases.

ralph I see. Well, there's no reason why we couldn't make that kind of arrangement with him.

MIKE You must admit, Ralph, it's an interesting offer.

ralph Mm, I'd need to know a lot more about this proposal before giving an opinion.

HAZEL Uh, like what?

RALPH Well, like … what about after-sales service? Who'll handle that? And then there's the advertising and the sales promo­tion. Will Sven Johansen pay for that? You didn't mention his financial contribution. Is he going to have a stake in the dealership? If so, how much will he invest in it? And what about the rest of Scandinavia? What's in this for us?

Answer the questions:

1.Why did Mike and Hazel go to Sweden?

2. Who did they meet there?

3. Who put them on to Sven Johansen? Why?

4. What can you say about Sven Johansen's background?

5. Why does Sven Johansen want to get out of his business?

6. What kind of agent does Sven want to be? Can you explain why?

7. Why does Sven want to buy and sell on his own account?

8. What does he hope to get in this case?

9. Why is his proposal interesting to the company?

10.What other points should be discussed before accepting the proposal?

ex.1.Insert the necessary prepositions.

1. The volume of sales of our company has been quite high which means that our policy has paid __ in the market.

2. He told us __ the record that the firm was doing badly this year.

3. The Export Manager wasn’t pleased __ our company’s sales in Sweden and I thought he was leading __ __ changing our sales approach.

4. I’m suggesting some kind of sales network, that’s what I have __ mind.

5. I’d like to make a proposal __ you to be an agent to distribute our goods. – Ah! I knew you had something __ your sleeve.

6. He wants commission __ sales, I suppose? No, he wants to buy and sell __ his own account.

7. The trouble is, will he have a stake __ the dealership?

8. I can’t make __ my mind whether to accept the Manager’s offer or not.

9. I think he can be responsible __ sales promotion, he has a lot going __ him.

10. Our Sales Manager was looking for a suitable agent and I put him __ __ Mike Sweeten who was a born salesman.

ex.2. Paraphrase the following sentences using your active vocabulary.

1. Your policy has brought you good results.

2. Our sales operation is working very efficiently.

3. I see that you are preparing me for some kind of news.

4. It’s a secret between us – my lips are sealed.

5. I knew you had a surprise for me.

6. There is a lot to say in his favour.

7. He is a salesman of great ability.

8. I’d like to find out everything about his previous experience.

9. What is the total amount of the goods sold by your firm?

10. He has the sole right to sell the goods in Sweden.

ex.3.Translate the following sentences into English.

1.Свен управляет закупочной конторой в Лондоне, и он предложил своим партнерам организовать сбытовую сеть или использовать агентов для сбыта товаров.

2.Хотя их деловая стратегия имела успех на зарубежных рынках, они могли бы еще преуспеть, если бы использовали другой подход к сбыту.

3.Он предложил, заметьте, совершенно неофициально, организовать маркетинговую работу и открыть отдел сбыта.

4.Какой смысл менять метод реализации, если наши торговые операции работают как часы?

5.Что плохого в том, что мы имеем простую систему выхода на покупателя?

6.Он - первоклассный менеджер и прирожденный бизнесмен.

7.Он будет выступать в качестве импортера-оптовика, накапливающего наши товары на складах и сбывающего их во всей Скандинавии.

8.Он не хочет получать комиссионные, но будет продавать и покупать на свой страх и риск, и за это надеется получать 20% скидку с прейскурантной цены.

9.Нам не ясен их финансовый вклад: будут ли они инвестировать дело и собираются ли они иметь долевое участие.

10.Я вижу, что у тебя есть что-то на уме, но никак не могу понять, куда ты клонишь.

ex.4.Read the following statements. Say whether they are true, if not correct them.

1. If you’ve got a good product, the customer won’t worry much about the price.

2. The best sales approach is to sell directly to certain stores.

3. Using buying offices you can reach all your potential customers.

4. To open a sales office you don’t need to have much capital.

5. An agent deals in distributing products in the market.

6. Born salesmen are usually extremely successful.

7. A sole distributor has exclusive rights.

8. An exclusive dealer usually works on commission.

9. You can’t give a discount to your sole distributor off list prices on all purchases.

Read and translate the following text.

The prices of raw materials and products change every day, so offers are usually only firm for about twenty-four hours. The prices of manufactured goods, on the other hand, remain unchanged, as a rule, for weeks or months, so buyers can place orders on the basis of a manufacturer’s printed price list.

There are many ways of selling manufactured goods to foreign buyers. A manufacturer may sell direct to wholesalers and maintain his own travelling representatives, or set up his own offices or companies abroad. Alternatively he may sell to an export merchanting house; in this case there is little financial risk for the producer, since the merchant acts as a principal and pays for the goods himself. A third possibility is for the manufacturer to appoint foreign agents, who will work on commission and may be stockists.

Answer the questions:

1. Why are some offers only firm for about 24 hours?

2. What prices remain unchanged for weeks or months?

3. How can a manufacturer sell his goods to foreign buyers?

4. In what case is there little financial risk for the producer?

5. What payment do foreign agents get for their work?

ROLE PLAYS

1. Discuss with your colleagues different methods of selling your goods abroad. Listen to their ideas and choose the best.

2. You have applied for the position of an agent distributing goods of a large company. Now you are having a job interview.

Marketing problems

1. Western companies had problems selling refrigerators in Japan until they changed the design to make them quieter.

2. In Saudi Arabia newspaper adverts showed an attractive hostess serving champagne to happy passengers. A lot of passengers cancelled their flight reservations.

3. A soap powder advertisement had a picture of dirty clothes on the left, a box of soap in the middle and clean clothes on the right. The soap didn’t sell well in the Middle East.

4. An airline company called itself Emu, after the Australian bird. But Australians didn’t want to use the airline.

Answer the questions on the topic:

1.What is marketing? What does it include?

2.What sales approaches do you know? What are the advantages and disadvantages of them?

3.What should be done to develop a sales network?

4.What are the duties of an agent? Does he get a salary?

5.Why is it so important to find the right person to be your agent?

6.What kinds of agents do you know?

Unit 8

An Agency Contract

PART 1

DIALOGUE 1

Mark Boland is head of an Australian import agency. He is discussing an agency contract with an American, Clint Marsden. Marsden is President of a company producing photocopying machines.

MARSDEN Before drawing up this agreement, I’d like to go over the contract terms once more, Mark.

BOLAND I've no objection to that. Even when you take notes as we did, it's easy to miss something out.

MARSDEN As I understand it, you'll be our agent for the whole of Australia. And you'll be handling our complete range of machines.

BOLAND Agreed.

MARSDEN Now the next point was … length of contract. It'll be three years, won't it?

BOLAND Yes, and, er, renegotiable, provided we're both happy with the arrangement.

MARSDEN I'm confident it'll work out all right. Let's see, what was the next point we discussed? Ah yes, whether you wanted a sole and exclusive agency.

BOLAND Uh-huh.

MARSDEN You don't want that, do you? You'll be selling competing lines along with our product.

BOLAND Yes. We agreed it won't really matter, as long as my sales force do the job properly.

MARSDEN I'm not worried about that. Your people are very profes­sional, I know. What next? Commission? Well, we fixed it at fifteen per cent (15%) on total sales, I believe.

boland Yes, but may I remind you that I'll be a del credere agent. I receive an extra five per cent (5%) commission for that.

marsden Ah yes, you’re bearing the risk if customers don't pay. I’d forgotten that.

boland I'm also responsible for invoicing customers and for credit control. I'll be sending you copies of all invoices for your records.

marsden We must have those because we'll be sending you a state­ment every three months. Your commission will be based on it. We'll settle up by transferring the money to your account in Sydney. The Bank of Australia and New Zealand. Right?

boland Mm, Victoria Street branch.

marsden The rest's fairly simple. Advertising, sales promotion — that'll be shared between us. Warehousing costs — we'll pay those, but you'll bear all office expenses. Last, but not least, after-sales service. That's your baby.

boland I promise you, Clint, we'll provide fast reliable servicing.

marsden Remember too, you've promised to keep adequate sup­plies of spare parts and accessories for the machines.

boland That's no problem, provided you get the parts to me when I ask for them.

marsden You can count on us for that.

Answer the questions:

1. What are Mark Boland and Clint Marsden’s positions?

2. Why do they want to go over the contract terms before drawing up the agreement?

3. What terms of the contract are being discussed?

4. What kind of agent is Mark Boland going to be? What are the advantages and disadvantages of it?

5. What will Boland be responsible for?

6. How long will the contract last?

7. Who will be responsible for invoicing customers and credit control?

8. What will the commission be based on?

9. How will they settle up?

10. Who will pay for advertising, sales promotion, warehousing, office expenses?

11. How will after-sales service be organised?

PART 2

DIALOGUE 2

It is two years later. Clint Marsden makes a special visit to Australia to talk to his agent, Mark Boland. Marsden is very dissatisfied with the agent's sales performance.

MARSDEN I'm sorry, there's no way I can break this news to you gently. I'm afraid we've decided to terminate our contract with you.

BOLAND You can't do that. There's still a year to run on it.

MARSDEN I know. But we hope you'll co-operate with us.

BOLAND Might I ask why you want to break the agreement?

MARSDEN Can't you guess?

BOLAND OK, I admit sales haven't come up to expectations. We haven't done too badly though. Three hundred grand last year. Or close to it.

MARSDEN Come on now, Mark, admit it, sales were well below target. We agreed on a market performance last January. Your sales objective was a minimum of five hundred thousand (500.000). Actually, seven hundred thousand (700.000) was a more realistic target.

BOLAND Huh! It's easy for you to talk. We're at the sharp end here. We have to fight for every dollar we make.

MARSDEN All right, it's not easy, I know. Look, it's not just that you failed to reach your sales target. Let's be honest, your after-sales service has been lousy. We've had dozens of complaints from customers ...

BOLAND That's news to me.

MARSDEN Really? We wrote to you about it. People saying they waited weeks for your sub-agent to make a service call. What do you say to that, uh?

BOLAND Yeah, maybe we have slipped up there. We shouldn’t have agreed to handle servicing for you. My organisation's not really geared for that sort of work.

marsden Why take it on then? After-sales service is vital to our success — you know that.

BOLAND Hold on, Clint! I It's not all my fault now, is it? You haven't exactly backed me up. I mean, I had no real incentive to sell your goods.

marsden What are you driving at?

BOLAND Well, you've only visited me twice in the last year. Not much, is it? And I've never been invited to your factory.

marsden Mm, mm ... perhaps we should have set up some kind of visit. But what with one thing and another, I ...

BOLAND Wait a minute, Clint. Let me have my say now. You promised to arrange joint promotions of your products. Nothing came of it, though. No wonder sales have been disappointing.

marsden Mark, I admit there’ve been mistakes on both sides.

BOLAND All I'm saying is - can't you give me another chance? Sales are sure to pick up soon. The recession can’t go on for ever.

marsden Sorry. It's just not possible to do that.

BOLAND What if I refuse to cooperate?

marsden We can't keep you as our agent, Mark. No way!

BOLAND If I play along with you, Clint, I'll expect generous compensation.

marsden We'll look after you, don't worry. Actually, Mark. we're considering opening up our own sales office in Australia.

BOLAND Is that so? Well... you'd certainly have greater control over sales that way, I suppose.

marsden Yes. And a more committed sales force.

Answer the questions:

1. Why is Masden dissatisfied with the agent’s sales performance?

2. Why has he decided to terminate the contract?

3. How much were the sales below target? Why?

4. How well was the after-sales service organized?

5. Whose fault was it?

6. What other mistakes were made?

7. What should have been done to reach the sales target?

8. Why does Boland ask to give him another chance?

9. Who will get a generous compensation and why?

10.What is Marsden’s company planning to open in Australia?

ex.1.Insert the necessary prepositions.

1. Before drawing __ the contract you should go __ all the contract terms very closely.

2. An exclusive agency can’t sell competing lines __ __ our products.

3. I hope these ideas about advertising and sales promotion will work__ all right __ practice.

4. Our company will provide you __ fast and reliable service, you can count __ us __ that.

5. If sales come __ __ expectations, the agent will keep the contract

6. I’m afraid we’ve decided to terminate the contract with you because sales were ___ target.

7. Our company’s sales didn’t reach the target because we were __ the sharp end.

8. We promised to arrange joint promotion of your goods but nothing came __ it, maybe we slipped __ there.

9. This company is not geared __ handling service.

10. If the company had backed the agent __, he would have had more incentive to sell their goods.

11. The results of the work are very disappointing. What are you driving __?

12. After the recession trade is picking __ again.

ex.2. Paraphrase the following sentences using your active vocabulary.

3. Who is providing after-sales service? That is your responsibility.

4. I hope you get the spare parts on time. You can be sure we will.

5. The results are very disappointing. Yes, but we are facing a lot of competition here.

6. What are you trying to say to me?

7. Your sales performance has been terrible.

8. Sales are sure to improve soon.

9. My organization is not suited to that sort of work.

10. Maybe we have made mistakes with our quality control.

11. What are the conditions of the contract?

12. Who will pay for the cost of running the office?

ex.3.Translate the following sentences into English.

1. Прежде чем заключить это соглашение, мне хотелось бы еще раз просмотреть условия контракта.

2. Вы будете продавать продукцию нашей фирмы параллельно с другими конкурирующими товарами.

3. Мы хотели бы предложить Вам комиссионные в размере 15% от общего объема сбыта.

4. Кто будет отвечать за выписывание счета покупателям и кредитный контроль?

5. Объем продаж не оправдал наших ожиданий. Он оказался ниже ожидаемого уровня.

6. Боюсь, нам придется прекратить действие контракта.

7. Агент будет нести все конторские издержки.

8. Он хочет быть агентом делькредере (комиссионером, берущим на себя делькредере) и получать дополнительные 5% комиссионных за это.

9. Я признаю, что мы совершили ошибку, т.к. наша организация не приспособлена для такой работы.

10. У него не было стимула продавать наши товары.

ex.4.Read the following statements. Say whether they are true, if not correct them.

1. Before drawing up an agreement you should go over the contract terms once more.

2. A sole and exclusive agent sells competing lines along with your products.

3. A del credere agent doesn’t bear the risk if customers don’t pay.

4. A del credere agent isn’t responsible for invoicing the customers.

5. A del credere agent is responsible for fast and reliable after-sales service.

6. Advertising, sales promotion are shared between an agent and a producing company.

7. If you are not satisfied with the work of your agent you can terminate the contract at any time.

8. If you are at the sharp end it isn’t easy to reach your sales target.

9. After-sales service isn’t very important to your success.

10. The recession is followed by the boom.

Read and translate the following text.

Big companies in Great Britain have their own network of distributive organisations to sell their goods at home and abroad. But smaller companies prefer doing their business abroad through intermediaries: agents and distributors.

The relations between the Agents and their Principals are determined by agency agreements on a commission or consignment basis, the difference being that the consignment agent sells the goods in his name and for his principal’s account like a commission agent and in addition he pays duties and taxes as well as for obtaining the import licence if necessary and often for advertising and for keeping the goods in a consignment warehouse and gets a higher commission accordingly. Also, a consignment agent may have to provide technical advice and after-sales service.

The main purpose of an Agent is seeking out customers and contracting with them on the Principal’s behalf for the sale of the Principal’s products in his country.

The essential difference between the Agent and the Distributor is that the Distributor operates on his own account as an independent purchaser for sale of the Supplier’s products, getting his remuneration from whatever profit he may make out of these sales.

The relations between the Distributor and the Supplier are determined by a distributorship agreement, stating that the Supplier grants to the Distributor the sole and exclusive right to purchase certain specified goods for sale in a given territory. Distributorship agreements are signed for the periods of up to 7 years, after which the matter can be reviewed with the intention of prolonging its effect.

Agency agreements are usually concluded for the terms of 3 or 5 years. Any overseas agency agreement should include in detail all the duties and obligations to be undertaken by both parties.

It is essential to insert into agency and distributorship agreements a statement that whatever the cause of the termination, no compensation will be paid by the Principal to the Agent or by the Supplier to the Distributor.

Answer the questions:

1. How do big and small companies in Britain distribute their goods?

2. What is the difference between a consignment and a commission agent?

3. What is the main purpose of an agent?

4. What is the difference between the Agent and the Distributor?

5. What is the difference between agency and distributorship agreements?

6. What is essential in both agreements?

ROLE PLAYS.

1.You are going to draw up an agency contract. Go over the terms of the contract with your partner.

2.A is a producer, B works for an import agency. They signed an agency contract some time ago.

A: You are not satisfied with your agent's sales performance and you have had dozens of complaints from customers. Discuss the problem with you agent and try to terminate the contract if necessary.

B: You realise that the sales were below the target, but it is not only your fault. Explain it to your partner and try your best in order not to terminate the contract.

Problem-solving

Your business has been going through a bad period but recently you have been negotiating for a long-term and valuable contract. At the last meeting you were taken on one side and told that the contract would be signed if you were prepared to make a payment into a numbered Swiss bank account operated by the chief negotiator on the other side. What would you do?

Answer the questions on the topic:

1.What is an agency contract?

2.What kinds of agents do you know?

3.What contract terms should be discussed before signing it?

4.Why can the contract be terminated?

5.How is it usually done?

6.Give as much information as possible on the topic: An agency contract.

GLOSSARY

U N I T 1. Choosing an Overseas Market.

PART I BUSINESS TERMS /1.1/

business strategy - the general plan or approach used by a company to sell its products

export field - areas to which goods are exported

to break into a market - to enter a market, get into it, penetrate a market

to expand - to become bigger, increase one's business activities

market –1.overseas, external, foreign; 2. home, domestic, internal saturated market - a market in which it is very difficult for a firm to increase sales because demand is fully met

market share - the proportion of the market supplied by one manufacturer

competitive market - a market in which many firms are trying to increase their sales by competing against each other

sales promotion - the methods used to increase sales of a product by advertising, exhibitions, demonstrations, free samples, etc.

turnover - total sales for a particular period

costs - the expenses of the company such as: wages and salaries, payments for raw materials, rent of a factory, heating and lighting

to market products - to offer them for sale

restrictions on trading (trading restrictions) - these are limits on free trade, e.g. a government may not allow the import and export of certain types of goods

import duties - taxes on goods coming into the country

quota - a limit placed by a government on the amount of imports or exports of a product or commodity

to meet delivery dates - to deliver goods to a customer by, or on the date promised

trade fair - a large commercial or industrial exhibition where buyers and sellers of a particular industry or product meet to do business

item on the agenda - a single subject which will be discussed at a meeting