Pricing Business Products Geographic pricing Deals with delivery costs FOB (free-on-board) origin pricing The seller’s pricing is exclusive of delivery costs; the buyer pays the transportation costs FOB destination pricing The seller includes transportation costs in the product pricing Transfer pricing Prices charged in sales between an organization’s units Copyright © Cengage Learning. All rights reserved
Pricing Business Products (cont’d) Discounting Trade discounts Discounts offered to intermediaries or middlemen Quantity discounts Discounts for large volume purchases Cash discounts Discounts for prompt payment Seasonal discounts Price reductions for buyers who purchase out of season Allowances Price reductions to achieve certain goals such as returning used equipment or increasing sales of a particular item Copyright © Cengage Learning. All rights reserved