Name Your Price

When your business is international, know what costs to factor in your pricing.

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
  • translation
  • 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."