Question

I would like you to know one of the common ways of calculating export prices. Market...

I would like you to know one of the common ways of calculating export prices.


Market price for customer---200
Manufacturing cost----50
Freight-----10%
Duty-----6%

Calculate the export price and profit: Exporter ---importer (35 % profit)----distributor- (35%) ----local dealer (45%)----customer (end user)

* Importer wants 35% margin (profit) on his/her on selling price
Distributor wants 35% margin on their selling price and similarly the local dealer wants a 45% margin when selling to the customer.

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Homework Answers

Answer #1
Local dealer to Customer $ & % Distributor to Local dealer $ & % Importer to Distributor $ & %
End price for the Buyer 200 145 137.93 135 102.17 135
Seller's profit(% ) given 62.07 45 35.76 35 26.49 35
Seller's cost     (Price-Profit) 137.93 100 102.17 100 75.68 100
200/145*45= 62.07 137.93/135*35= 35.76 102.17/135*35= 26.49
From the table,
Importer's cost=
Exporter's selling price= 75.68 Answer
Total cost:
Manufacturing cost 50
Freight--- (50*10%) 5
Duty---(50+5)*6% 3.3
Total cost 58.3
Profit 17.38 Answer
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