Discuss the causes of and solutions for parallel imports and their effect on price.
Why is it so difficult to control consumer prices when selling overseas?
Explain the concept of price escalation and tell why it can mislead an international marketer.
What are the causes of price escalation? Do they differ for exports and goods produced and sold in a foreign country?
Why is it seldom feasible for a company to absorb the high cost of international transportation and reduce the net price received?
Price escalation is a major pricing problem for the international marketer. How can this problem be counteracted? Discuss.
Changing currency values have an impact on export strategies. Discuss.
“Regardless of the strategic factors involved and the company’s orientation to market pricing, every price must be set with cost considerations in mind.” Discuss.
“Price fixing by business is not generally viewed as an acceptable practice (at least in the domestic market), but when governments enter the field of price administration, they presume to do it for the general welfare to lessen the effects of ‘destructive’ competition.” Discuss.
Do value-added taxes discriminate against imported goods?
Explain specific tariffs, ad valorem tariffs, and compound tariffs.
Suggest an approach a marketer may follow in adjusting prices to accommodate exchange rate fluctuations.
Explain the effects of indirect competition and how they may be overcome.
Why has dumping become such an issue in recent years?
Cartels seem to rise, phoenix-like, after they have been destroyed. Why are they so appealing to business?
Discuss the different pricing problems that result from inflation versus deflation in a country.
Discuss the various ways in which governments set prices. Why do they engage in such activities?
Discuss the alternative objectives possible in setting prices for intracompany sales.
Why do governments so carefully scrutinize intracompany pricing arrangements?
Why are costs so difficult to assess in marketing internationally?
Discuss why countertrading is on the increase.
Discuss the major problems facing a company that is countertrading.
If a country you are trading with has a shortage of hard currency, how should you prepare to negotiate price?
Of the four types of countertrades discussed in the text, which is the most beneficial to the seller? Explain.
Why should a “knowledge of countertrades be part of an international marketer’s pricing toolkit”? Discuss.
Discuss the various reasons purchasers impose countertrade obligations on buyers.
Discuss how FTZs can be used to help reduce price escalation.
Why is a proactive countertrade policy good business in some countries?
Differentiate between proactive and reactive countertrade policies.
One free trade zone is ZFM of Montevideo. Visit www.zfm.com and discuss how it might be used to help solve the price escalation problem of a product being exported from the United States to one of the Mercosur countries.
Select, “What are FTZs” and “What are benefits of FTZs” from the Web page of the National Association of Foreign Trade Zones www.naftz.org and visit the home page of a FTZ in McAllen, Texas, www.medc.org, on the border between the United States and Mexico. How does the description of this FTZ differ from the discussion in the text? Discuss how an exporter from the United States could use this FTZ to lower distribution costs.
Visit Global Trading (a division of 3M) at www.mmm.com/globaltrading/edge.html and select The Competitive Edge and Who We Are. Then write a short report on how Global Trading could assist a small company that anticipates having merchandise from a countertrade.
