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Asked Nov 16, 2019
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What are some tactics companies can use to improve the difficulty of setting international prices?

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Expert Answer

Step 1

At first it is important to discuss about the factors which is used to determine the international pricing.

  1. Company and product oriented factor: It includes range of products, product life cycle, unique selling point and product differentiation factors, cost of shipping, cost of inventories including the three stages of inventory, that is raw material, work in progress and finished goods, scarce resources, degree of standardization of international product, different objectives of marketing and economies of scale.
  2. Factors effecting market: Consumers taste and preference, demand and purchasing ability, need of promotional activities, requirement of extra packaging, distribution networks, elasticity of demand, credit requirement, competitive strategies, etc.
  3.  Factors effecting environment: Constraints due to government interference related to tax, fluctuation of currencies, inflation, use of lease, etc.
Step 2

The tactics that companies can use to improve the difficulty of setting international prices are as follows:

  1. Penetration pricing methodology: It is used to attract the customers, when a new product is being entered into the market. Later on after grabbing the customers, the price is to be increased gradually to hold the market.
  2. Economical ...

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