Being a supplier of big buyers is the dream of many small and medium-sized export companies. Understanding the pricing strategies of these big buyers is undoubtedly beneficial to the close cooperation between the two parties. Suppliers who become big buyers don't have to worry about the number of orders, but some suppliers are grateful and worried about the low bids of buyers.

After the supplier understands the buyer's specific expectations and requirements on the price, he can adjust his production and sales strategy accordingly. Suppliers who are good at learning can seize the opportunity to grow rapidly in the process of cooperating with world-class procurement companies.

Kingfisher, with more than 2,900 retail stores in 16 countries, is one of the leading retail groups in Europe. The company mainly sells 2 kinds of products: furniture and decoration products and electrical appliances. Kingfisher Asia Limited is Kingfisher's office in Asia and is headquartered in Hong Kong. The main products they purchase include: household items such as furniture, building materials, power tools, lamps, and electrical products such as audio equipment, DVDs, etc.

Kingfisher Asia Limited has established a representative office in Shanghai, which is mainly responsible for the procurement business in the mainland. At present, there are more than 20 employees, and the procurement locations are mainly concentrated in East China, Central China and North China. Zhou Liren is the general manager of the Shanghai Representative Office. He talked about his views on the strategy of purchasing pricing.

I. Important factors for cooperation with suppliers

Zhou Liren said that when deciding whether to cooperate with a supplier, it is also necessary to consider other equally important factors. A reliable supplier must be of good quality, competitive price, and on time delivery. Therefore, buyers will balance prices and other factors when making decisions.

Generally, large-scale buyers have a strict evaluation supplier system, and one of the important requirements is about social responsibility. Before deciding whether to cooperate with the same supplier, Kingfisher will inspect the production conditions of the factory, the living conditions of workers, whether to hire illegal labor and child labor, and whether the production process will pollute the environment.

Second, the method of product pricing

When Kingfisher decides to purchase a product, it does some research on the purchase price. As the saying goes: "The goods are three." Kingfisher compares the quotations of 3-4 suppliers and weighs other factors besides those quotes. It is not who gets the offer to get the order.

Determine a target retail price before engaging with the supplier. For example, Kingfisher is preparing to sell a certain kind of product made in China. They will investigate the retail price of other merchants in the market and determine a meaningful promotional price. For example, the normal market price may be 22 pounds, but a little profit margin. Determine the retail price of £19.9.

Then, according to this price, the target retail price minus the expected profit, sea freight, inland freight, distribution center cost, import tariff, etc., will result in a FOB price, and then take this price to find the right supplier. .

Third, factors affecting the purchase price

Suppliers as large retailers should have some understanding of the marketing management of the retail industry, which will allow both parties to better understand and meet each other's needs. Retailers often use a number of advertising catalogues to promote and promote them. The Kingfisher advertisements are printed in millions of copies, which will greatly promote the sales of the products that appear on them. It means more orders, so if the supplier can bear some of this promotion cost, it will be reflected in the purchase price, it will be lower than usual. But this is a mutually beneficial form of cooperation that benefits both parties.