International Pricing, Pricing Methods, International Pricing, Bill of Exchange, Open Account, Letter of Credit, Marketing Control

1. International Marketing
Module VII

2.  Price of an product is its market value expressed in term of
money.
 Objectives of Pricing
 Price Stabilization
 Targeted Return on Investment / Sale
 Prevent Competition
 Market Share
 Maximize Sales / Profits
 Promotion

3.  Currency Fluctuations
 Exchange Rate Clauses
 Pricing in an Inflationary Environment
 LIFO or FIFO
 Government Controls & Subsidies
 Competitive Behavior
 Price & Quality Relationship

4.  Cost – Plus Pricing
 Break Even Analysis & Targeted Return Method
 Penetration v/s Skimming
 Competition Based Pricing
 Discounted
 At Par
 Premium

5.  Gray Marketing
 Dumping
 Transfer Pricing
 Cost – Based
 Market – Based
 Negotiated

6.  Ethnocentric (Home Country Standardization)
 Polycentric (Host Country Adoption)
 Regiocentric (Home + Host Country Approach)
 Geocentric (Global Approach)

7.  Advance Payment
 Consignment
 Open Account
 Bill of Exchange
 Letter of Credit

8.  Open account is a typical payment procedures for established
customers. In this exporter delivered the goods for whole
month and the customer is billed on an end-of-the month basis.
Customer deposited the bill amount on monthly basis in the
account of exporter.

9.  A Bill of Exchange is an instrument in writing containing an
unconditional order, signed by the maker, directing a certain
person to pay a certain sum of money, to a specified person.
 Can be used for loan purpose from bank

10.  Letter of credit is a document issued by the buyer’s bank in
favor of seller to reduce the credit risk

11. Sales Agreement
Foreign
Buyer
Foreign
Bank
Seller
Bank
Seller
Customs
port of
entry
Freight
Forwarder
& Carrier
1
32
513 712
9
81011
4
6
A Letter of Credit Transaction

12.  It involves gathering information on marketing performance
and comparing the achieved performance against the planned
or budgeted performance, using the pre-determined
standards and yardsticks.

13. 1) To examine whether the planned results are
being achieved.
2) To examine where the company is making
and losing money.
3) To evaluate and improve the spending
efficiency and impact of marketing
expenditures.
4) To examine whether the company is pursuing
its best opportunities with respect to markets,
products and channels.

14. 1) It provides feedback, it regulates and it
exercises a restraining or redirecting influence.
2) It ensures that the marketing activity does not
derail or go off the track
3) It also provides the required clues for timely
correction.
4) It paves the way for maximization of
profitability and productivity of all marketing
activities.

15. 1. Establishment of control standards
a) Growth and profits
b) Marketing Operations
c) Efficiency Measures
d) Comparative Analysis
2. Measurement of performance
a) Customer satisfaction
b) Customer’s perception of the firm and its competitor brands
c) Market Share
d) Sales
e) Profits
f) Marketing effectiveness
g) Preparedness of marketing organization to respond to external
environment challenges.
3. Comparison between performance and standard
4. Correction of deviations from standards

16. 1) Annual Plan Control: - It aims to ensure that the company achieves
the sales, profits, and other goals established in its annual plan.
a) Sales Analysis
b) Market-share analysis
c) Marketing Expense to sales analysis
d) Financial Analysis
2) Profitability Control
a) Marketing Profitability Analysis
b) Determining Corrective Action
3) Efficiency Control
a) Sales force efficiency
b) Advertising Efficiency
c) Sales Promotion Efficiency
d) Distribution Efficiency
4) Strategic Control
a) The Marketing Effectiveness Review
b) The Marketing Audit

17. a) Inadequate Control Procedures
b) No regular Review Procedures
c) Failure to Compare the Prices with the Competitors
d) Inaccurate Control Reports
e) Distance and Communication Gaps
f) Inappropriate Budgetary System
g) Lack of Motivation to licensee
h) Lack of Coordinating International Sales
i) Unethical Business Practices

18. 18
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