Pricing for International Markets

Pricing for International Markets - Pricing for...

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Pricing for International Markets 1. Pricing Policy (Pricing Objectives; Parallel Imports) 2. Approaches to International Pricing (Full-Cost versus Variable-Cost Pricing; Skimming versus Penetration Pricing) 3. Price Escalation (Costs of Exporting; Taxes, Tariffs, and Administrative Costs; Inflation; Deflation; Exchange Rate Fluctuations; Varying Currency Values; Middlemen and Transportation Costs) 4. Sample Effects of Price Escalation 5. Approaches of Lessening Price Escalation (Lowering Costs of Goods; Lowering Tariffs; Lowering Distribution Costs; Using Foreign Trade Zones to Lessen Price Escalation) 6. Leasing in International Markets 7. Countertrade as a Pricing Tool (Types of countertrade; Problems of Countertrading; the Internet and the Countertrade; Proactive Countertrade Strategy) 8. Transfer Pricing Strategy 9. Price Quotations Administered Pricing (Cartels; Government Influenced Pricing) Chapter Learning Objectives What you should learn from Chapter 10: Components of pricing as competitive tools in international marketing The pricing pitfalls directly related to international marketing How to control pricing in parallel imports or grey markets Price escalation and how to minimize its effect Countertrading and its place in international marketing practices The mechanism of price quotations Chapter 10
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PRICING FOR INTERNATIONAL MARKETS Setting the right price for a product can be the key to success or failure. Even when the international marketer produces the right product, promotes it correctly, and initiates the proper channel of distribution, the effort fails if the product is not properly priced. Although the quality of Canadian products is widely recognized in global markets, foreign buyers, like domestic buyers, balance quality and price in their purchase decisions. A products price must reflect the quality and value the consumer perceives in the product. Of all the tasks facing the international marketer, determining what price to charge is one of the most difficult. It is further complicated when the company sells its product to customers if different country markets. As the globalization of world markets continues, competition intensifies among multinational and home-based companies. All are seeking a solid competitive position so they can prosper as markets reach full potential. The competition for the diaper market between Kimberly-Clark, P&G, and the smaller companies illustrates how price becomes increasingly important as a competitive tool and how price competition changes the structure of a market. Whether exporting or managing overseas operations, the managers responsibility is to set and control the actual price of goods in different markets in which different sets of variables are found: different tariffs, costs, attitudes, competition, currency fluctuations, and methods of price quotation.
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