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What Does an International Trade Broker Do?

Gerelyn Terzo
By
Updated Mar 03, 2024
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New relationships in international trade are developed routinely as the needs and offerings of market participants change. An international trade broker is typically responsible for locating appropriate importing businesses on behalf of exporting companies. International trade brokers usually earn a commission based on the size of trade deals that are performed. The business is highly relationship-driven and dependent on experience because of the complex nature of conducting business with foreign entities.

Brokers may approach their businesses differently, but cold-calling is a frequent tactic used to uncover new business. Typically, brokers send letters and facsimiles when reaching out to new buyers. Given that brokers are often trying to locate a foreign buyer for a domestic company's offering, the language barrier can be a roadblock. One way that an international trade broker manages this is by contacting new international trade parties in the primary language of the importing country, which can help in the sales process.

International trade is a business in which large and costly shipments are often arranged. An international broker is compensated based on the size of the deals that he or she initiates. Bank financing is a frequent component to international commerce, and subsequently a broker is privy to certain banking relationships with trade parties.

When trade is financed through credit, it is the responsibility of the importing party to obtain a letter of credit from a financier. Once that financing is approved, an international trade broker could have a hand in receiving those funds on behalf of the exporting business. After the money becomes available, the goods that are being ordered may be shipped.

The products that an international trade broker represents on behalf of exporting entities might be anything for which there is demand. When attempting to export goods to a third-world country, for instance, a broker might attempt to build relationships with businesses that make products that will further social and economic development in that region. A broker could choose a niche and specialize in facilitating export transactions for a certain type of goods.

To demonstrate a certain standard of performing business, a trade broker might earn an industry certification. This designation can help in creating new business, especially as a new broker. In addition to earning a formal designation, broker professionals who participate in global trade independently or through another organization often join industry networks to keep current with commerce regulations.

Practical Adult Insights is dedicated to providing accurate and trustworthy information. We carefully select reputable sources and employ a rigorous fact-checking process to maintain the highest standards. To learn more about our commitment to accuracy, read our editorial process.
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Gerelyn Terzo
By Gerelyn Terzo
Gerelyn Terzo, a journalist with over 20 years of experience, brings her expertise to her writing. With a background in Mass Communication/Media Studies, she crafts compelling content for multiple publications, showcasing her deep understanding of various industries and her ability to effectively communicate complex topics to target audiences.
Discussion Comments
By ImExExpert — On Sep 18, 2012

An international trade broker, or an import/export trade broker, in very simplistic terms, functions as a middle-man. He or she connects a buyer and seller and collects a commission in the process. Brokers should not cold-call. Instead, look to your immediate area for business. The U.S. is the largest manufacturer in the world, so there is probably an opportunity around you, no matter where you live.

Once you have a source, then you set out to find a buyer. This requires a lot of research. Develop an international marketing plan and use government resources. Additionally, if the business has never exported, they will need an export management plan and they need to have the systems and processes in place so that the international sale goes well.

As a broker, you should have an contractual agreement in place that outlines your commission, how and when you get paid, and any other requirements (minimum orders, etc.). It is best if you have knowledge, so learn as much as you can.

Gerelyn Terzo
Gerelyn Terzo
Gerelyn Terzo, a journalist with over 20 years of experience, brings her expertise to her writing. With a background in...
Learn more
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