Do you know the four major methods of foreign trade quotations?

foreign tradeEnterprises should determine the corresponding price according to the enterprise and market conditions, and then adopt an appropriate pricing method to conclude a transaction. The following areZhongShen International Tradethe four major foreign trade quotation methods summarized by the foreign trade import business.

I. Forward Quotation Method

The forward quotation method is a way in which the seller offers the highest price first or the buyer offers the lowest price. This quotation method usually leaves more room for negotiation between the buyer and the seller. Otherwise, the price is often distorted. If the buyer thinks the sellers price is too high after the seller offers a higher price, it will immediately reject or doubt the sellers sincerity and ask the seller to reduce the price. When the buyer thinks the sellers price is more reasonable, it still asks the seller to continue to reduce the price. When the seller reduces the price, the buyer will get some psychological satisfaction. If the price offered by the seller is too thin, exceeding the minimum profit that the other party can expect, there will be random quotations, and the buyer and the seller will not be able to continue the negotiation.

II. Reverse Quotation Method

The reverse quotation method is a semi - traditional bidding system in which the seller first offers a low price or the buyer offers a high price to attract customers. The purpose of attracting the customers attention in the negotiation is mostly a false price at the beginning. Then, find a breakthrough in other transaction conditions, gradually move the price up or down, and finally trade at the expected price. Adopting this quotation method poses a high risk to the first - quoting party. If the negotiation position of the first - quoting party is not very favorable, after offering a surprise price, it may eliminate other competitors, but there is also a risk that the price is difficult to recover to the expected level. In fact, it should be avoided as much as possible in business negotiations.

III. First - quotation Method

This quotation provides a series of price negotiations controlled by both parties. When the buyer offers a low price first, the expected transaction price of both parties is between the buyers price and the sellers expected price. Conversely, when the seller offers a high price first, the expected transaction price of both parties must be between the sellers price and the buyers expected price.

IV. Tail - number Quotation Method

This method uses a special way to apply peoples psychological tail - number for pricing, trying to avoid integer quotations. The use of tail - number quotations is, on the one hand, due to peoples digital psychology, and on the other hand, due to the need for business negotiation skills. As mentioned above, the price of a specific product is usually calculated based on the actual cost plus profit, and integers are rare. So if one party uses an integer estimate, it is difficult to convince the other party. On the other hand, it takes advantage of the customs and habits of some ethnic groups and countries, uses the numbers that locals particularly like in the quotation or counter - offer, and selects the numbers they need.