Price

Salehoo Wholesale Sources

Wholesale Sources For eBay Sellers

Get Instant Access

wholesaler margin and retailer margin to its factory price. Depending on these added costs, the product may have to sell for two to five times as much in another country to make the same profit. For example, a pair of Lcvi's jeans that sells for S30 in the United States typically fetches 863 in Tokyo and S88 in Paris.

Another problem involves setting a price for goods that a company ships to its foreign subsidiaries. If the company charges a foreign subsidiary too much, it may end up paying higher tariff duties even while paying lower income taxes in that country. If the company charges its subsidiary too little, it can be charged with dumping - that is, pricing exports at levels less than their costs or less than the prices charged in its home market. Since the 1980s the EU has aggressively increased the use of anti-dumping measures against imports ranging from electronics components to raw materials. For example, the FU imposed anti-dumping duties of as much as 96.8 per cent on imports of broadcasting cameras made by some Japanese companies. The duties were imposed after an investigation by the European Commission, following complaints by BTS, part of Philips, and Thomson Broadcast of France (Europe's only makers of studio video cameras), found that Japanese exporters had, through unfair pricing, increased their share of the EU studio market from 52 per cent in 1989 to 70 per cent in 1992. European producers' share had fallen from 48 per cent to 30 per cent over this period.21

Last but not least, many global companies face a grey market. For example, Minolta sold its cameras to Hong Kong distributors for less than it charged German distributors because of lower transportation costs and tariffs. Minolta cameras ended up selling at retail for £80 in Hong Kong and £170 in Germany. Some Hong Kong wholesalers noticed this price difference and shipped Minolta cameras to German dealers for less than the dealers were paying their German distributor. The German distributor couldn't sell its stock and complained to Minolta. Thus a company often finds some enterprising distributors buying more than they can sell in their own country, then shipping goods to another country to take advantage of price differences. International companies try to prevent grey markets by raising their prices to lower-cost distributors, dropping those that cheat, or altering the product for different countries.

Was this article helpful?

0 0
Salehoo Secrets and Tips

Salehoo Secrets and Tips

As with any web site, SaleHoo has a number of features that will help you in buying products from around the world. Once you have an account on SaleHoo, which only costs a one-time fee, you can establish up to twenty named searches for products. After that, any time those items become available, you’ll be alerted.

Get My Free Ebook


Post a comment