Company: PETER SCANLAN WOOLS

State: WESTERN AUSTRALIA

Sector: AGRIBUSINESS

Peter Scanlan Wools, a small West Australian wool trader and exporter,
have exported wool to India since establishing their business in the
mid-1980s. By 2001, India accounted for about 20 per cent of their sales.
Their wool exports to India are through two long established agents who
are closely linked to several wool textile mills. Peter Scanlan Wools
emphasises the importance of these agents; through time the company has
changed their representatives several times after re-assessing their
performance and trustworthiness.

The extremely price sensitive Indian market features keen and
persistent negotiators. Peter Scanlan Wools advises extreme care in
negotiating and writing contracts given the risk of contract reneging and
lack of legal recourse; letters of credit in particular need to be
carefully monitored and checked for discrepancies. The company also found
Australian financial institutions reluctant to honour letters of credit
from Indian banks. However, careful choice and monitoring of agents will
largely offset these potential concerns and Peter Scanlan Wools believes
the Indian wool trade holds good future opportunities.

Source: Peter Scanlan Wools, 2001.