unit 8 Pricing.ppt

* * * * * * * * * * Unit 8 Pricing Outline Content of Price Term Commission and Discount Pricing Methods Case Study Content of Price Term Pricing Strategy Penetration pricing Skimming pricing Early cash recovery pricing Pricing Object Pricing Principle Various Cost Factors Unit cost of product Profit Agent’s commission abroad Packing cost Labeling cost Marking cost Strapping cost Cost of taking goods to the seaport Unloading cost Terminal cost Cost of documents Other charges Ocean freight Freight forward’s fee Export credit insurance Marine insurance Financial charges Price Term in Contract In contract: unit price, total amount, method of pricing Unit Price USD 100 per dozen FOB New York type of currency price per unit measurement unit trade terms HKD 30 per Carton FOB Dalian net. (net price,净价) USD 500 per M/T CIFC5 Boston. (price with commission,含佣价) Total Amount Total price is the total amount of a deal. e.g.: Total Amount: USD5000 e.g.: Total Amount: USD5000 FOB Liverpool Both commission and discount are general practices often employed in foreign trade to promote exporting and win keen trade competitions. Then,…… Commission Discount Definition Commission Broker Discount Importer Commission is the service fees charged by the agents or brokers for the transactions made for their principles, such as the commission paid by the exporter to its sales agent, and the commission paid by the importer to its purchasing agent. Discount :is the price deduction allowed by the Seller to the Buyer as a reward for paying cash (cash discount), buying in quantity (quantity discount, volume discount), making early payment (trade discount), or granting some other advantage to the seller. The way to pay discount: The discount is customarily to be deducted from the payment when the