MKTG209 Study Guide - Final Guide: Incoterms, Marketing Mix, Transfer Pricing
Document Summary
Price: price is the amount of money charged for a product. Is a competitive tool: market pricing: pricing according to the market, skimming: high initial cost, lowered over time, penetration: low cost, high market share. Internal costs + external costs -> firms objectives -> pricing strategies -> price. Export related costs: adaptions, operational costs, government costs, distribution channel length, market entry costs, price escalation: when export prices exceed domestic prices. Incoterms: defined by the international chamber of commerce in 1936. Terms of payment: the exporter will be concerned over being paid for the goods shipped and will therefore consider the following when negotiating terms of payment, strength of firms, competitors offers, protection, capacity for financing. Ensuring export payments: minimising risk, assessing buyers, lowering commercial & non-commercial risk. Sources of export financing: commercial banks, forfaiting, factoring, official trade finance (government) Objectives of countertrade: remaining competitive, reducing costs, avoiding tax, manage cash flows.
