This chapter discusses international pricing. It identifies the objectives, factors, and approaches that determine export prices. There are two main types of costs in export marketing: production costs and selling/delivery costs. Pricing is affected by objectives, costs, competition, differentiation, exchange rates, markets, image, and governments. Cost is a key factor along with supply, demand, and competition. The chapter also covers transfer pricing, pricing steps, quotations, and information needs.
International pricing directly impact the success of product in international market.Right pricing strategies and methods of pricing helps in making the brand hit in global market.
International Marketing Management - Product & Pricing DecisionsSOMASUNDARAM T
Products for consumers in global markets: product development; product adaptation; analyzing product components for adaptation; product standardization; marketing of services; product development; quality; products and culture; marketing consumer services globally; brands in international markets; Products and services for businesses: demand in global business to business markets; quality and global standards; business services; trade shows' crucial part of business to business marketing; relationship markets in business to business context
Global pricing framework; pricing basics; marginal cost pricing and its importance; transfer pricing; counter trade; systems pricing; pricing and positioning; price quotation; INCO terms; preparation of quotations.
New-Product Pricing Strategies
Product Mix Pricing Strategies
Price Adjustment Strategies
Price Changes
Market-skimming pricing is a strategy with high initial prices to “skim” revenue layers from the market
Product quality and image must support the price
Buyers must want the product at the price
Costs of producing the product in small volume should not cancel the advantage of higher prices
Competitors should not be able to enter the market easily
Market-penetration pricing sets a low initial price in order to penetrate the market quickly and deeply to attract a large number of buyers quickly to gain market share
Price-sensitive market
Inverse relationship of production and distribution cost to sales growth
Low prices must keep competition out of the market
International pricing directly impact the success of product in international market.Right pricing strategies and methods of pricing helps in making the brand hit in global market.
International Marketing Management - Product & Pricing DecisionsSOMASUNDARAM T
Products for consumers in global markets: product development; product adaptation; analyzing product components for adaptation; product standardization; marketing of services; product development; quality; products and culture; marketing consumer services globally; brands in international markets; Products and services for businesses: demand in global business to business markets; quality and global standards; business services; trade shows' crucial part of business to business marketing; relationship markets in business to business context
Global pricing framework; pricing basics; marginal cost pricing and its importance; transfer pricing; counter trade; systems pricing; pricing and positioning; price quotation; INCO terms; preparation of quotations.
New-Product Pricing Strategies
Product Mix Pricing Strategies
Price Adjustment Strategies
Price Changes
Market-skimming pricing is a strategy with high initial prices to “skim” revenue layers from the market
Product quality and image must support the price
Buyers must want the product at the price
Costs of producing the product in small volume should not cancel the advantage of higher prices
Competitors should not be able to enter the market easily
Market-penetration pricing sets a low initial price in order to penetrate the market quickly and deeply to attract a large number of buyers quickly to gain market share
Price-sensitive market
Inverse relationship of production and distribution cost to sales growth
Low prices must keep competition out of the market
International Business (BBA MBA) advantages & disadvantages of international busine, approaches of international business, entry strategy, imf, international business (bba mba) entry policy, international organization, nature & scope & feature of international business, need for international business, reasons for recent growth in international busines, what is international business ?university of solapur
International marketing mix: global products and servicesluispachon
International marketing mix: global products and services takes into account what are the characteristics that companies must consider in order to satisfy the local customer's needs.
International Business (BBA MBA) advantages & disadvantages of international busine, approaches of international business, entry strategy, imf, international business (bba mba) entry policy, international organization, nature & scope & feature of international business, need for international business, reasons for recent growth in international busines, what is international business ?university of solapur
International marketing mix: global products and servicesluispachon
International marketing mix: global products and services takes into account what are the characteristics that companies must consider in order to satisfy the local customer's needs.
This presentation has information about International pricing methods & factors affecting International pricing & Incoterms used in International trade
In this presentation, we will understand the scope of promotional spending, to measure and evaluate such spending, in details.
To know more about Welingkar School’s Distance Learning Program and courses offered, visit:
http://www.welingkaronline.org/distance-learning/online-mba.html
Strategy And The Firm· A firm’s strategy refers to the actions t.docxsusanschei
Strategy And The Firm
· A firm’s strategy refers to the actions that managers take to attain the goals of the firm
· Profitabilitycan be defined as the rate of return the firm makes on its invested capital
· Profit growth is the percentage increase in net profits over time
· Expanding internationally can boost profitability and profit growth
Managers can increase the profitability of the firm by pursuing strategies that lower costs or by pursuing strategies that add value to the firm’s products, which enables the firm to raise prices. Managers can increase the rate at which the firm’s profits grow over time by pursuing strategies to sell more products in existing markets or by pursuing strategies to enter new markets. As we shall see, expanding internationally can help managers boost the firm’s profitability and increase the rate of profit growth over time.
Value Creation
· The value created by a firm is measured by the difference between V (the price that the firm can charge for that product given competitive pressures) and C (the costs of producing that product)
· The higher the value customers place on a firm’s products, the higher the price the firm can charge for those products, and the greater the profitability of the firm
The value of a product to an average consumer is V; the average price that the firm can charge a consumer for that product given competitive pressures and its ability to segment the market is P; and the average unit cost of producing that product is C (C comprises all relevant costs, including the firm’s cost of capital). The firm’s profit per unit sold () is equal to P C, while the consumer surplus per unit is equal to V P (another way of thinking of the consumer surplus is as “value for the money”; the greater the consumer surplus, the greater the value for the money the consumer gets). The firm makes a profit so long as P is greater than C, and its profit will be greater the lower C is relative to P. The difference between V and P is in part determined by the intensity of competitive pressure in the marketplace; the lower the intensity of competitive pressure, the higher the price charged relative to V.4 In general, the higher the firm’s profit per unit sold is, the greater its profitability will be, all else being equal.
Profits can be increased by:
· adding value to a product so that customers are willing to pay more for it – a differentiation strategy
· lowering costs – a low cost strategy
· Michael Porter argues that superior profitability goes to firms that create superior value by lowering the cost structure of the business and/or differentiating the product so that a premium price can be charged
Strategic Positioning
· Michael Porter argues that firms need to choose either differentiation or low cost, and then configure internal operations to support the choice
To maximize long run return on invested capital, firms must:
· pick a viable position on the efficiency frontier
· configure internal ope.
1. Drivers of Foreign Market Pricing
2. Managing Price Escalation
3. Pricing in Inflationary Environments
4. Global Pricing and Currency Movements
5. Transfer Pricing
6. Global Pricing and Antidumping Regulation
7. Price Coordination
8. Countertrade
Welingkar's Online PGDM Program in Supply Chain Mgmt is designed to understand the levels involved in bringing a manufactured product to the right channel.
WeSchool's Online PGDM Program in E-Commerce Mgmt is designed to combine technology, business, marketing, logistics, etc to prepare you for jobs in ecommerce.
We School's Online PGDM Program in International Business Mgmt covers some of the advanced subjects like International Economics & International Business Environment.
We School's Online MBA Program in IT Projects Mgmt prepares IT, project managers, to provide leadership in planning, executing & directing complex IT projects.
WeSchool's Online PGDM Program in E-Business Mgmt will help students interested in getting into the e-business with expertise in e-commerce & online shopping.
WeSchool's Online PGDM Program in Business Administration extensively covers several topics on marketing, investment, functional administration, sales, etc.
Online PGDM Program in Finance Mgmt Descriptionibes the role of Finance Manager, beneficial for professionals interested in a career in finance-related sectors.
WeSchool offers AICTE approved Diploma in Marketing Management. It is a specialized Management program with focus on marketing as a core business function
WeSchool Offers Online MBA Program in Operations Mgmt. Production planning, project management & world-class manufacturing are among the critical concepts.
Gain a better understanding of the various industry functions, business trends and industry regulations in the travel and tourism industry to emerge as a powerful team leader.
Visit our Websites: https://www.welingkaronline.org/
In today's increasingly competitive business environment, organizations are engaged in a rat race to retain customers, build up clientele and simultaneously ensure steady growth. Unfortunately, they often get caught in a web of issues which may not be easily controlled and affect performance. Here comes the play of Financial Accounting. Professional accountants have a vital role in commercial success by using their valuable knowledge to provide their organizations/clients a competitive advantage and an accurate picture of their financial position and performance.
British Aerospace Asset Management Case study will tech you how important is asset management for your business. lern from the experts about the Asset management.
Mc donalds Recruitment Case Study will explain you each and every thing about the Recruitment. hiring a right person at your workplace will be one of the best part of your business management. learn how to hire or recruit perfect person in your company with this case study of Mc donalds Recruitment.
More from We Learn - A Continuous Learning Forum from Welingkar's Distance Learning Program. (20)
Palestine last event orientationfvgnh .pptxRaedMohamed3
An EFL lesson about the current events in Palestine. It is intended to be for intermediate students who wish to increase their listening skills through a short lesson in power point.
How to Make a Field invisible in Odoo 17Celine George
It is possible to hide or invisible some fields in odoo. Commonly using “invisible” attribute in the field definition to invisible the fields. This slide will show how to make a field invisible in odoo 17.
Synthetic Fiber Construction in lab .pptxPavel ( NSTU)
Synthetic fiber production is a fascinating and complex field that blends chemistry, engineering, and environmental science. By understanding these aspects, students can gain a comprehensive view of synthetic fiber production, its impact on society and the environment, and the potential for future innovations. Synthetic fibers play a crucial role in modern society, impacting various aspects of daily life, industry, and the environment. ynthetic fibers are integral to modern life, offering a range of benefits from cost-effectiveness and versatility to innovative applications and performance characteristics. While they pose environmental challenges, ongoing research and development aim to create more sustainable and eco-friendly alternatives. Understanding the importance of synthetic fibers helps in appreciating their role in the economy, industry, and daily life, while also emphasizing the need for sustainable practices and innovation.
The Roman Empire A Historical Colossus.pdfkaushalkr1407
The Roman Empire, a vast and enduring power, stands as one of history's most remarkable civilizations, leaving an indelible imprint on the world. It emerged from the Roman Republic, transitioning into an imperial powerhouse under the leadership of Augustus Caesar in 27 BCE. This transformation marked the beginning of an era defined by unprecedented territorial expansion, architectural marvels, and profound cultural influence.
The empire's roots lie in the city of Rome, founded, according to legend, by Romulus in 753 BCE. Over centuries, Rome evolved from a small settlement to a formidable republic, characterized by a complex political system with elected officials and checks on power. However, internal strife, class conflicts, and military ambitions paved the way for the end of the Republic. Julius Caesar’s dictatorship and subsequent assassination in 44 BCE created a power vacuum, leading to a civil war. Octavian, later Augustus, emerged victorious, heralding the Roman Empire’s birth.
Under Augustus, the empire experienced the Pax Romana, a 200-year period of relative peace and stability. Augustus reformed the military, established efficient administrative systems, and initiated grand construction projects. The empire's borders expanded, encompassing territories from Britain to Egypt and from Spain to the Euphrates. Roman legions, renowned for their discipline and engineering prowess, secured and maintained these vast territories, building roads, fortifications, and cities that facilitated control and integration.
The Roman Empire’s society was hierarchical, with a rigid class system. At the top were the patricians, wealthy elites who held significant political power. Below them were the plebeians, free citizens with limited political influence, and the vast numbers of slaves who formed the backbone of the economy. The family unit was central, governed by the paterfamilias, the male head who held absolute authority.
Culturally, the Romans were eclectic, absorbing and adapting elements from the civilizations they encountered, particularly the Greeks. Roman art, literature, and philosophy reflected this synthesis, creating a rich cultural tapestry. Latin, the Roman language, became the lingua franca of the Western world, influencing numerous modern languages.
Roman architecture and engineering achievements were monumental. They perfected the arch, vault, and dome, constructing enduring structures like the Colosseum, Pantheon, and aqueducts. These engineering marvels not only showcased Roman ingenuity but also served practical purposes, from public entertainment to water supply.
Embracing GenAI - A Strategic ImperativePeter Windle
Artificial Intelligence (AI) technologies such as Generative AI, Image Generators and Large Language Models have had a dramatic impact on teaching, learning and assessment over the past 18 months. The most immediate threat AI posed was to Academic Integrity with Higher Education Institutes (HEIs) focusing their efforts on combating the use of GenAI in assessment. Guidelines were developed for staff and students, policies put in place too. Innovative educators have forged paths in the use of Generative AI for teaching, learning and assessments leading to pockets of transformation springing up across HEIs, often with little or no top-down guidance, support or direction.
This Gasta posits a strategic approach to integrating AI into HEIs to prepare staff, students and the curriculum for an evolving world and workplace. We will highlight the advantages of working with these technologies beyond the realm of teaching, learning and assessment by considering prompt engineering skills, industry impact, curriculum changes, and the need for staff upskilling. In contrast, not engaging strategically with Generative AI poses risks, including falling behind peers, missed opportunities and failing to ensure our graduates remain employable. The rapid evolution of AI technologies necessitates a proactive and strategic approach if we are to remain relevant.
Welcome to TechSoup New Member Orientation and Q&A (May 2024).pdfTechSoup
In this webinar you will learn how your organization can access TechSoup's wide variety of product discount and donation programs. From hardware to software, we'll give you a tour of the tools available to help your nonprofit with productivity, collaboration, financial management, donor tracking, security, and more.
Model Attribute Check Company Auto PropertyCeline George
In Odoo, the multi-company feature allows you to manage multiple companies within a single Odoo database instance. Each company can have its own configurations while still sharing common resources such as products, customers, and suppliers.
Francesca Gottschalk - How can education support child empowerment.pptxEduSkills OECD
Francesca Gottschalk from the OECD’s Centre for Educational Research and Innovation presents at the Ask an Expert Webinar: How can education support child empowerment?
2. Objectives
What determines export prices
What are the objectives of pricing
What factors affect pricing
what are the approaches in export
pricing
What is transfer pricing
What is dumping
International Marketing
Chapter-10 International Pricing
3. What are the steps involved in pricing
What are the steps in retrograde pricing
What are export price quotation and
incoterms
What are the information requirements
of export pricing
International Marketing
Chapter-10 International Pricing
4. Introduction
Right price is one of the important
determinants of business success.
The uniqueness of price in the
marketing mix is that it is the only
element that generates revenue.
At the outset one may think that price
must cover at least the full cost of
production and marketing.
International Marketing
Chapter-10 International Pricing
5. Types Of Costs In Export
Marketing
1. Production costs
2. Selling and delivery costs
International Marketing
Chapter-10 International Pricing
6. Productions Costs
1. Fixed costs
2. Variable costs
International Marketing
Chapter-10 International Pricing
7. Pricing Objective
1. Market penetration
2. Market share
3. Market skimming
4. Fighting competition
5. Preventing new entry
6. Shorten pay-back period
7. Early cash recovery
International Marketing
Chapter-10 International Pricing
8. 8. Meeting export obligation
9. Disposal of surplus
10. Optimum capacity utilization
11. Return on investment
12. Profit maximization
International Marketing
Chapter-10 International Pricing
9. Factors Affecting Pricing
International marketing objective
Costs
Competition
Product differentiation
Exchange rate
Market characteristics
Image
Government factor Marketing
International
Chapter-10 International Pricing
10. Cost Based Pricing
Cost based pricing, also known as cost plus
pricing, is a common method of pricing.
Under this method the price includes a
certain percentage of profit margin on the
sum total of the full cost of production,
marketing costs and an allocation of the
overheads.
That is, price=(fixed costs+variable
costs+overheads+marketing costs)+
specified percentage of the total costs
International Marketing
Chapter-10 International Pricing
11. Market Oriented Pricing
This is a very flexible policy in the sense
that it allows the prices to be changed in
accordance with the changes in market
conditions.
The product may be priced high when
demand conditions are very good and the
price may be lowered when the market is
sluggish if that helps increasing sales.
This method is sometimes referred to as
what the traffic will bear method.
International Marketing
Chapter-10 International Pricing
12. Break Even Price
Break-even price is the price for a given level
of output at which there is neither any loss
nor profit.
Break-even analysis helps to understand the
minimum sales required to avoid any loss and
also the profit or loss at various levels of
sales.
The break-even point(BEP) is the point of
sales at which there is neither any loss nor
any profit.
International Marketing
Chapter-10 International Pricing
13. Calculation Of BEP In Terms
Of Physical Units
BEP = FC α FC
SP-VC C
Where
FC = fixed cost
VC = variable cost
SP = selling price
C = contribution per unit ( C=SP-VC )
International Marketing
Chapter-10 International Pricing
14. Marginal Cost Pricing
Marginal cost pricing approach is
common in evaluating the profitability
of new orders in case of firms with
excess capacity.
Under the marginal cost pricing, the
relevant cost considered for pricing is
the variable cost, the fixed cost is
excluded from the calculation of the
cost of the product. Marketing
International
Chapter-10 International Pricing
15. Creative Pricing
Marginal costing may give scope for
creative pricing.
Creative pricing means taking
advantage of the flexibility between the
lower limit of break-even price and the
upper limit of the competitor’s price for
similar product.
International Marketing
Chapter-10 International Pricing
16. Transfer Pricing
Transfer pricing or intra company pricing
refers to the pricing of goods transferred
from operations or sales units in one
country to the company’ s unit elsewhere.
The appropriate basis for intracompany
transfers often depends on the nature of
the subsidiaries, the market conditions and
government policies and regulations.
International Marketing
Chapter-10 International Pricing
17. Some studies show that, in most cases,
setting up transfer prices remains the
absolute prerogative of the parent
company executives regardless of the
firm’s nationally.
International Marketing
Chapter-10 International Pricing
18. Steps In Pricing
1. Defining pricing objectives
2. Analyzing market characteristics
3. Calculating costs
4. Calculating value of incentives
5. Determining export price
International Marketing
Chapter-10 International Pricing
19. Export Price Quotations And
Incoterms
EXW – EX WORKS
FCA – Free carrier
FAS – Free Alongside Ship
FOB – Free On Board
CFR – Cost And Freight
CIF – Cost, Insurance and Freight
CPT – Carriage Paid To
International Marketing
Chapter-10 International Pricing
20. CIP – Carriage and Insurance Paid To
DAF – Delivered At Frontier
DES – Delivered Ex Ship
DEQ – Delivered Ex Quay
DDU – Delivered Duty Unpaid
DDP - Delivered Duty Paid
International Marketing
Chapter-10 International Pricing
21. Documents Required Under
Various Terms
EXW – Ex Works
FCA – Free Carrier
FAS- Free Alongside Ship
FOB – Free on Board
CFR – Cost and Freight
CIF – Cost, Insurance and Freight
CPT – Carriage Paid to
International Marketing
Chapter-10 International Pricing
22. CIP – Carriage and Insurance Paid to
DAF – Delivered at Frontier
DES – Delivered Ex Ship
DEQ – Delivered Ex Quary
DDU – Delivered Duty Unpaid
DDP – Delivered Duty Paid
International Marketing
Chapter-10 International Pricing
23. Information Requirement For
Export Pricing
Information on the total market
Information on competition
Information on prices
Information on Government policies
Information on production and costs
Information on revenue and profits
International Marketing
Chapter-10 International Pricing
24. Summary
There are two types of cost in export
marketing; production costs and selling and
delivery costs.
The factors which affect pricing policies are;
international marketing objective, costs,
competition, product differentiation,
exchange rate, market characteristics, image
and government factors.
Cost is one of the most important factor in
export pricing besides supply conditions and
demand and competitive conditions.
International Marketing
Chapter-10 International Pricing