Marketing Objective 2.11 Order Processing

Charges to the company associated with bank card purchases. Credit card fee (percent of sales based on a sliding scale) Travel and entertainment cards is slightly higher than bank cards 1.79% (MC/Visa) - 3.25% (Am Ex) Debit card fee (flat fee no matter how much purchase is)

Discounts for the customer associated with purchases Purchase Discount – money that a business saves on a specific order if the payment is made within a certain period of time. Ex: $100 item, with a purchase discount term 3/10, net 30. If he pays within 10 days, he pays $97. If not, the full $100 needs to be paid within 30 days.

Bulk discounts – purchasing a large quantity and getting a discount on the price

Customer Discounts AKA – “it’s on sale” KNOW*** how to calculate Multiply the regular price times the discount rate Rupp tip – subtract the discount from 100 and multiply Example: $850 phone on sale for 25% off 100-25 = 75 $850 x .75 = $637.50 Let’s do another one

Sales Tax KNOW*** how to calculate: Take the item price Multiply by sales tax rate. If 6% sales tax = multiply by .06 Different states and countries have different sales tax rates Example: $300 item x .06 = $18 in tax Let’s do another one Sales Tax Rates Geographical Zone Tax Rate A 15% B 7% Rest of World 0%

Shipping Charges Let’s do another one ***KNOW how to calculate: Take the weight of the item Multiply by the rate Example: 320-pound sofa; delivery rate $9.80 per 100 lbs 3.2 (for the 100) x 9.80 = $31.36 shipping Let’s do another one Shipping Rates Geographical Zone Shipping Rate per 100 lbs A $15 B $10 Rest of World $25

Calculating TOTAL cost $200 Prom Dress or Tuxedo – 15% off Sales tax 6.5% Alterations and Delivery $30 What is the total cost?

Let’s Calculate $200 x .85 = $170 Sales tax = $170 x .065 = $11.05 Garment – $170.00 + tax. $11.50 + alterations $30.00 Total

GRAND TOTAL = $211.50

Charges and discounts affect the price Can increase the cost of items, overall, to cover credit card charges and frequent discounts Retailers want to make money, so they pass the charges/loss of revenue because of discount down to the customer Consumer false sense of discount

Technology speeds up calculations of charges and discounts Don’t have to figure “in your head” or by hand calculations of charges and/or discounts Cash register/POS (point of sale) terminal/Register does it for you, so you don’t have to make change Ex: $6.65 sale. You are given a $10 bill. How will you make change? Lessens the time taken to double check figures.

Special Order The request of an item not normally in stock or carried at a store

Special Orders Effect on Retailers? Continue to meet customers’ needs and establish their loyalty Time consuming to find the item, place, track, and deliver order May lose money on an item if a price is quoted to a customer before the total cost (price, shipping, tax) is made aware to you---the retailer.

Processing Telephone Orders. Talk slowly Repeat what the customer has said Write order Confirm with customer what has been ordered Upselling/Cross Selling Payment Method Expected Delivery Date Thank for business