Pricing in international markets
Checklist of factors impacting on pricing in international markets
- Market positioning of product or service via price in the target market, e.g. high price to signal high value and exclusivity
- Membership of tariff union such as the European Union: check all aspects of rules surrounding products or services originating in the union versus those imported from outside the union.
- Prices already operating in home country where relevant
- Currency exchange rates with other countries, both actual and potential
- Costs of tariff and other barriers
- Any variation in local taxes, including value added tax
- Prices of similar products already available in the target country
- Trade discounts and other special deals already operating in the target country, e.g. regular discounts off the manufacturer’s list price for reaching volume targets
- Distributor markup already operating in the target country, i.e. the difference between the distributor’s price and the customer’s price
- For multinationals, the prices at which goods are transferred between subsidiaries – called ‘transfer pricing.’
- Availability of web-based selling structures and distributors both to reduce selling costs and to promote goods
- Possibility of parallel trade pricing, i.e. goods imported from low-tax country into parallel country with higher taxes
- Reaction of current competitors via price to new entrants.