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Pricing Decisions: Power Point by Kristopher Blanchard North Central University
Pricing Decisions: Power Point by Kristopher Blanchard North Central University
Pricing Decisions: Power Point by Kristopher Blanchard North Central University
Pricing Decisions
Power Point
By
Kristopher Blanchard
North Central University
© 2005
©2005 Dr.Gerard Ryan,Prentice Hall
Universitat Rovira i Virgili.
11-2
International Pricing Strategies
Company Internal Environmental
Market Factors
Factors Factors
Profitability Income Levels Foreign Exchange
Analytic Transports Costs Competition Rates
Dimensions Tariffs Customers’ Culture Inflation Rates
Taxes Price Controls
Production Costs Regulations
Channel Costs
BRITAIN $13,040
FINLAND 8,290
FRANCE 10,510
GERMANY 11,040
ITALY 10,690
© 2005
©2005 Dr.Gerard Ryan,Prentice Hall
Universitat Rovira i Virgili.
11-5
Under (-)/
The
TheHamburger
HamburgerStandard
Standard
Under (-)/
over (+)
over (+)
valuation
valuation
Local Currency Dollars Implied PPP* Actual $ exchange against the
Local Currency Dollars Implied PPP* Actual $ exchange against the
of the dollar rate 17/04/01 dollar %
of the dollar rate 17/04/01 dollar %
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© 2005 Prentice Hall 11-27
Extension
Ethnocentric
Per-unit price of an item is the same no
matter where in the world the buyer is
located
Importer must absorb freight and import
duties
Fails to respond to each national market
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© 2005 Prentice Hall 11-30
Currency Fluctuations
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© 2005 Prentice Hall 11-31
Inflationary Environment
Defined as a persistent upward change in
price levels
– Can be caused by an increase in the money
supply
– Can be caused by currency devaluation
Essential requirement for pricing is the
maintenance of operating margins
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