PRICING

IN

INTERNATIONAL
Factors Determining
Price.

1.Demand

2.Competition

3.Costs
Export Pricing.
-The export pricing is based on this following decisions:

 Survival

 Max. sales growth

 Max. current profit

 To establish leadership
 Export Costing Method.
 Cost based/plus pricing

 Market oriented pricing

 Following competitors

 Negotiated price
Cont.….
 Customer determined price

 Break-even price

 Marginal cost pricing

 Transfer pricing

 Dumping
Factors Influencing Pricing
policy.

 International marketing objectives

 Costs

 Competition

 Product differentiation

 Exchange rates
Cont.…..
GOVT. Factors:

 Regulation of margins

 Price floors & ceiling

 Subsidies

 Tax concession & exemption

 Govt.competition
PRICING STRATEGIES

 Skimming pricing

 Penetration pricing

 Trial pricing

 Flexible pricing
CONTD………
 Differential pricing

 Transfer pricing

 Standard export pricing

 Follow the leader pricing

Break-Even Pricing.
Break-even price
= FC+VC
Q
International Commercial
Terms (Incoterms)
 EXW EX Works

 FCA Free Carrier

 FAS Free Alongside Ship

 FOB Free On Board

Cont.….
 CFR Cost & Freight

 CIF Cost, Insurance & Freight

 CPT Carriage Paid To (duty paid)

 CIP Carriage & Insurance Paid To

Cont.….
 DAF Delivered At Frontier

 DES Delivered Ex Ship

 DEQ Delivered Ex Quay

 DDU Delivered Duty Unpaid

 DDP Delivered Duty Paid

Export Incentives.

 Industrial Raw Material Assistance Centre

(IRMAC scheme)

 Marketing Development Assistance

(MDA)

 Exemption from income tax

 Ocean freight rebate

Cont.….
 Sales tax exemption

 Duty Drawback (DBK)

 Excise duty exemption

Export Assistance In Marketing.

 MDA

 Bridging the information gap

(Indian Trade Promotion Organization)

 Trade fairs & exhibitions

 Blanket Permits
CONTD…..

 Deemed Exports

 Export Promotion Capital Goods scheme

(EPCG)

 Duty Entitlement Pass Book scheme

(DEPB)

Market Access Initiatives (MAI)

CONTD…..

 Agricultural & Processed Food Export

Development Authority (APEDA)

 Sales, Income,& Service tax exemption

 Value Added Tax (VAT)

 Modified Value Added Tax (MODVAT)