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The main goals of this chapter are to: Components of pricing as competitive tools in international marketing, how to control pricing in parallel import or gray markets, price escalation and how to minimize its effect, countertrading and its place in international marketing practices, the mechanics of price quotations, the mechanics of getting paid. | Pricing for International Markets Chapter 18 Learning Objectives LO1 Components of pricing as competitive tools in international marketing LO2 How to control pricing in parallel import or gray markets LO3 Price escalation and how to minimize its effect LO4 Countertrading and its place in international marketing practices LO5 The mechanics of price quotations LO6 The mechanics of getting paid 2 International Pricing Setting and changing prices are key strategic marketing decisions Prices both set values and communicate in international markets An offering’s price must reflect the quality and value the consumer perceives in the product In setting a price in international markets, different tariffs, costs, attitudes, competition, currency fluctuations, and methods of price quotation need to be taken into account. Pricing Policy The country in which business is being conducted, the type of product, variations in competitive conditions, and other strategic factors affect pricing activity Active marketing in several countries compounds the variables relating to price policy An explicitly thought out, defined pricing policy helps avoid setting a price in haste Pricing Objectives In general, price decisions are viewed in two ways: Pricing as an active instrument of accomplishing marketing objectives, or Pricing as a static element in a business decision 5 Pricing Objectives The more control a company has over the final selling price of a product, the better it is able to achieve its marketing goals It is not always possible to control end prices Broader product lines and the larger the number of countries involved, the more complex the process of controlling prices charged to the end user Parallel Importation or Gray Markets The possibility of a parallel market occurs whenever price differences are greater than the cost of transportation between two markets On account of competition, firms may have to charge different prices from country to country Parallel imports . | Pricing for International Markets Chapter 18 Learning Objectives LO1 Components of pricing as competitive tools in international marketing LO2 How to control pricing in parallel import or gray markets LO3 Price escalation and how to minimize its effect LO4 Countertrading and its place in international marketing practices LO5 The mechanics of price quotations LO6 The mechanics of getting paid 2 International Pricing Setting and changing prices are key strategic marketing decisions Prices both set values and communicate in international markets An offering’s price must reflect the quality and value the consumer perceives in the product In setting a price in international markets, different tariffs, costs, attitudes, competition, currency fluctuations, and methods of price quotation need to be taken into account. Pricing Policy The country in which business is being conducted, the type of product, variations in competitive conditions, and other strategic factors affect pricing activity
