Vetting foreign business partners
- Marcel Hoebink
- How to
- 1 May 2023
- Edited 2 Nov 2022
- 1 min
- Managing and growing
When purchasing products from a foreign vendor or delivering to a foreign customer, you want the assurance that the company you are doing business with is reliable and financially healthy. In the Netherlands, you can check a company in KVK’s Business Register. You can find out how reliable foreign companies are by checking foreign business registers, consulting a Dutch embassy abroad, or looking up the company in question on the website of a sector organisation.
Before you do business with a foreign business partner, it is always best to investigate their business dealings first. Make sure to check many different sources.
Most countries have a business register. In the Netherlands, the Chamber of Commerce manages the Business Register, and most countries have some equivalent. A record in a business register does not guarantee that a company is trustworthy, but it does tell you whether they are legally registered in their country of origin. Moreover, registers will also tell you who is authorised to act on behalf of a company. For more information, check out the list of business registers (in Dutch) in and outside Europe.
Economic departments of the Dutch foreign network (in Dutch) can find out if the company you want to do business with actually exists. Some embassies, for instance, conduct company checks, such as the embassies in Russia (in Dutch) and China (in Dutch).
Credit reporting agencies screen companies for a fee and prepare credit reports. You can find several agencies through search engines online.
Check if the foreign company you want to do business with is a member of a local sector organisation. Sector organisations represent their industry and aim to build a good reputation with reliable members. Sector organisations will often set quality standards, allowing companies that meet these standards to use a quality mark. You can find out whether your business partner is a member of a foreign sector organisation by visiting the website of the organisation in question.
On the internet, you can find positive and negative reviews of your potential foreign business partner. Visit their website and take a close look at their contact options. If the website only mentions a P.O. box or a mobile phone number, rather than an official branch address and landline number, you might want to investigate whether the company actually exists. Also check the email address: does it look professional? Even checking your business partner’s address on Google Maps can produce surprising insights.
Before you place a larger order, ask your foreign suppliers to send samples. If you have customers abroad, they might ask you to do the same thing. Sample shipments give buyers a sense of the delivery time and quality they can expect. It is up to the vendor to decide whether or not to send samples free of charge. Important factors to consider here are product type, value, and intended use.