factors affecting export pricing in international marketing

Published: 06th March 2006
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The important Factors affecting International Export Pricing Policy Decisions are

Cost of Production. -Mainly refers to the Investment Cost for Production which must Usually be Planned Well in Advance using Forecasting Methods during Planning Issues before Actual Production is Started which still has Fluctuations in Values that is actually Retrieved from Actual Production when Compared to Estimated Production in Advance.



Demand. -Is affected if the Market is not Studied Properly by means of Proper Marketing Research Methods and Exploration of Market Survey Methods
Competition. - A Manufacturing Company must be Analyzed and always be Monitored at Finger tips in terms of Product, Quality, Value with respect to Core Competitors using Investigation Methods and make Comparisons in all Forms including Packaging Methods, Export Value in Global Market quoted as Price for the Product, etc and try to out beat every Competitor coming across with best Quality Product in least time with tremendous Chase to achieve Maximum Profit and reputation oriented Targets in International Levels.



Product Differentiation-If Products are Differentiated and they have built up a Brand Image themselves; Manufacturers are in a position to Charge comparatively higher Prices. BRAND is very important in every Business Market for Company recognition of its Product. But until the BRAND is established very well in International Markets, it is safe to keep the Cost of Product at a Medium level which is Acceptable and will give Profit Returns for the Firm focusing on Selling the Product with best Quality, But if Manufacturers charge Higher Prices right from the Start for BRAND of the Product in International Markets, then it's a Risk for the Exporter venturing at such Markets. Other Factors to be taken into consideration for product are Packing, Labeling, Marking, Transportation and Distribution Costs.



Exchange-Many Exporters try to Focus on the Value of what Amount will be Obtained as Profits in terms of Foreign Exchange Conversion when they see certain Currencies like POUNDSTERLING, EURO, U.S.DOLLAR, ETC and blindly try to Venture directly into these Countries which have these Native Currencies for Overseas Exports and suffer. They suffer because always Foreign Exchange factors can't be Considered as a Profit Oriented item for Business, Firstly ,Our products made must be Saleable in the International Market and for which we have to Identify the Buyers who will find our Products useful for them and try to start Negotiation and issue Quotation for Commodity Exchange for Foreign Exchange with best Quality.



Market Characteristics such as Demand Trends, Consumer Income Levels and Importance of the Product to the Consumer are highly Essential for Global Markets. Demand is a very Important issue. In Marketing for the Product to be Saleable which must be always High to Generate Profits otherwise Business suffers. Also the Product of the Exporter must be rRecognized well and must Definitely be useful for the Consumer, only then he Will be Interested in Buying the Product. Apart from all these, the Consumer must have Good Revenue of Income generated from his Business so that he can Afford comfortably and Pay for the Product. It is Safe to keep an eye on the Customer and Analyze him many Times about his . Usefulness on the Above Mentioned Factors ,Otherwise Business suffers.



Trade Margins-The Belt of Import and Export must always be Monitored and Deviations must be Checked to Mark a Balance and avoid Trade Offs in International Business Transactions.
Image-The Quality of the Product must be Noteworthy, Remarkable with no Complaints ensuring 100% Customer Satisfaction and must take care during Packaging with a Good Finish and Transportation without any Delay either in Sea or Air.
Government Factors namely Regulation of Margins, Floor Price, Subsidies, Tax Concession must be taken into Account for Export Pricing. After Sales Service including ensuring Supply of Spare Parts and Components after warranty period.



The author can be contacted at sowmya_ramani@yahoo.com


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