One of the most difficult aspects of taking your business international is pricing products. According to Marcia Youel Smith, president of Reston, Virginia-based Columbia Cascade Inc., which produces software used by associations, educators and government agencies to calculate export pricing, international pricing is a two-step process.
First, find a base price that takes into account the additional expenses you incur just by crossing borders. These include:
- international market research
- export distribution fees and sales commissions
- international advertising and marketing
- product modifications to comply with international standards
- packaging that meets export requirements
- export consulting, accounting and legal fees
Then, once you have a specific international customer to quote for, you have to consider the costs particular to getting your goods to that company, such as:
- shipping and handling (packing, marking, labeling, consolidating and containerizing)
- preparing export documents, certifications and licenses
- compiling export shipment documents
- insurance certifications and policies
- dangerous/hazardous materials declarations and certifications
- freight-forwarder, consignee, customhouse-broker and/or consulate fees
"Pricing can be a confusing task," Smith concedes, "but you get better at it once you're familiar with all the factors."