0322_internal_Pricing.docVIP免费

InternalInterviewNotesInterviewDate:22March2000IntervieweeName:Ms.XuIntervieweePosition:FormerPricingManagerofPlanning&FinancialDept.InterviewerName:BillHe,JaneXuBackgroundTruckpricemakingprocessTherearetworoundsofnegotiationinexistingtruckpricemakingFirstroundnegotiation(1)FAWTradingCompanydeliversasuggestedpricetoPlanning&FinancialDepartmentbasedonmarketinformation(estimatedcompetitivepriceincomparisonwithcompetitorsameproducts’price)(2)Planning&FinancialDepartmentwillcalculatetheprice’sedgecontributiontocheckwhethertheprofitcouldcoverthecost,detailcalculation:EdgeContributionRate=(FAWTradingSuggestedPrice-RawMaterial-OutsourcedEnergy-Outsourcedcomponent-Outsourcedequipment-scrap)/FAWTradingSuggestedPriceUsually,Planning&FinancialDepartmentwillacceptthepricewhichcouldprovide20%-30%grossmargine.Tothosegrossmarginelowerthan20%,Planning&FinancialDepartmentwillnegotiatethepricewithFAWTrading20%-30%EdgeContributionRatewasmadetocoverthecostofSalary,Depreciation,Welfare,AdministrationFees,etc.This“20%-30%”standardkeepssameinthepastfewyearsbyPlanning&FinancialDepartmentUsually,FAWTradingwillnotacceptthepricenegotiationfromP&FDepartmentandthusasecondroundnegotiationstartsSecondRoundNegotiationFAWTradingCompanyPlanning&FinancialDepartment(1)(2)(3)FAWTradingandPlanningDepartmentwillholdasecondroundpricebargainingiftheycouldn’treachagreementinthepreviousround(4)Ifthissecondroundstillfails,thefinalpricewillbedecidedbytwoVPwhoinchargeofthedepartmentAveragepricedecisioncircleisaround4to5months(fromOctobertonextyear’sJanuaryorFebruary),sometimeevenlongerIfthemarketsituationchangesduringtheprocessofpricingdecision,thetwodepartmentwillsetsupsometemporarynegotiationconferencetodiscussthepriceNewtruckpricemakingStage1(2)FAWProductDevelopmentDepartmentdeliverstheFAWTradingdemandtoR&DCenterforfurtherresearch(3)FAWR&DCentermakeasampletruckandaskAccountingDepartmenttopredictcostofrawmaterial,outsourcedenergy,outsourcedcomponent,outsourcedequipment,etc.Stage2FAWTradingCompanyPlanning&FinancialDepartment(3)Mr.An(VPinchargeofSalesMr.Teng(VPinchargeofPlanning)(4)FAWAutomotiveR&DCenterFAWProductDevelopmentDepartmentFAWTradingCompanyFAWAccountingDepartment(1)(2)(3)(1)FAWTradingCompanyfeedbackthemarketrequirementsfornewproductfromdealersandend-userstoFAWProductDevelopmentDepartmentFAWTradingCompanyandFAWAccountingDepartmentholdthepricenegotiationconferencesbasedonthecost,grossmarginandpossiblemarketreactionComponentPriceMakingPlanning&FinancialDepartmenthassetthelowestcomponentpricelimitationtowardsFAWTradingCompany:PriceB=FOB+3%+10%FAWTradingCompanydecidethecomponentsalespricetowardsitscustomers:SalesPricetoservicecenter=PriceB+2%SalesPricetocomponentstore=PriceB+5%SalesPricetokeyclients=PriceB+10%BuyingpricefromFAWcomponentsuppliersMarginsettocoverthecostlikebusinesstravelfees,inventory,inspectionexpenses,etc.Marginsettocoverre-packagingfee,transportationfee,etc.