What are the real costs of having an export manager in your company? And are there cheaper ways to manage your international distribution network? This article shows that you can better have part-time regional country managers who travel to your headquarters once in a while.
Export manager salaries
Salaries may differ with the number of years of experience, and obviously, with the country you are based in. We made a comparison for various parts of the world:
| W-Europe | USA | China | India | |
| Average salary | $62.000 | $95.000 | $37.000 | $15.000 |
| Salary of an experienced manager | $77.500 | $118.750 | $46.250 | $18.750 |
Countries like Australia and Japan are comparable in cost level with the USA, Singapore, and Hong Kong with Western Europe. Africa may be close with India for the most part; Eastern Europe and Latin America are on average on China’s cost level.
This is only part of the equation. On top of the salaries, employers have more costs, such as worker’s insurances or specific taxes. And a manager also requires attention from his boss, the HR department support departments. This overhead also needs to be taken into account.
Travel cost
Travel costs are flights, hotels, taxis, and meals. And since you have to optimize travel time and keep your flexibility, it’s mostly not the cheapest option.
For air travel, a significant difference is whether to travel business class or economy. Most companies have a policy that if your flight is longer than 6 or 8 hours, traveling in business class is allowed. For shorter regional flights, the economy is chosen. Seniority level and whether you have to work the next day directly may count as well.
If you have an effective export manager, they will travel at least six times a year to one of the regions they are responsible for and do some regional flights there. If the flight is intercontinental, the duration of the trip may easily be two weeks.
We have calculated intercontinental business class fares for a moderate 3,000 USD per return. Local flights for 500 USD per trip. Hotel costs for ten nights per trip for only 150 USD. Even in ‘cheap’ countries, you may pay high prices for hotels, especially if you want to meet people there. And finally, we calculated 150 USD per travel day for taxis, food, drinks, and other expenses.
Total costs for employing an export manager
We have combined the salary levels in four parts of the world and added up all costs. See the table below. We also calculated an hourly rate out of it, based on 1600 hours of work per year.
| W-Europe | USA | China | India | |
| Average salary | $62.000 | $95.000 | $37.000 | $15.000 |
| Salary of an experienced manager | $77.500 | $118.750 | $46.250 | $18.750 |
| Additional employer costs | 23% | 8% | 12% | 10% |
| Overhead | 10% | 10% | 10% | 10% |
| Salary costs | $103.075 | $140.125 | $56.425 | $22.500 |
| Travel 6 times business class | $18.000 | $18.000 | $18.000 | $18.000 |
| Travel 6 times locally economy | $3.000 | $3.000 | $3.000 | $3.000 |
| Hotel costs 6 x 10 days | $9.000 | $9.000 | $9.000 | $9.000 |
| Other expenses locally | $10.800 | $10.800 | $10.800 | $10.800 |
| Total costs | $143.875 | $180.925 | $97.225 | $63.300 |
| Hourly rate based on 1600 hours | $90 | $113 | $61 | $40 |
This means that for a USA company if you can find somebody to do the job for you for less than 113 USD per hour, it is better to outsource the activities. For Western Europe, this is around 90 USD per hour; for China and India, lower.
Export managers are effective for only half of their time.
Export managers are mostly the most effective when interacting with your distributors or agents, so being abroad. But typically, they spend most of their time at your office since travel is expensive and tiring.
Of course, there is also paperwork to arrange and align with other company departments. However, since cultural differences within the company are limited, communication can also be email or phone. This is not the case with distributors on other continents.
Suppose you add up travel time, less effective email and phone communication with distributors abroad, and relative unfamiliarity with the target countries’ culture. In that case, export managers are only useful for about half of their time.
The alternative: working with locally-based country or regional managers
The alternative is to have a network of regional or country managers who visit your company once or twice per year. The rest are seen by you once a year and manage the country or region from within. This does not need to be full-time. You can also hire such a country or regional manager part-time with Alliance experts in over 20 countries worldwide.
This has many advantages:
- The area manager better understands the local cultures.
- Time differences are minimal, so better contact with the distributors or agents.
- Travel costs are much lower.
- Management of the local agents or distributors can be much stricter.
And especially for companies from the USA or Western Europe who want to export to ‘cheaper’ regions: you benefit from the lower salary levels and daily rates in the target country.
If you work with us, you will benefit from a locally based country or regional manager, who, on the one hand, will understand your business quickly and with whom you can easily communicate. On the other hand, he or she knows the culture, the local languages. He or she has an extensive network already. This way we can work more effectively than any export manager from abroad.
How to make the calculation?
We would be happy to make the calculation with you and show you the benefits. Please contact us through our network of local.
