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Step 8: Preparing your export plan

You are here:Step 8:Preparing your export plan > Preparing an export marketing strategy for your firm > The export price > Step 2: Costing for exports > Costing sheet framework


 

 

Costing sheet framework

 

  1. A. Calculating an EX WORKS price

    Start

    Production costs
    Direct raw material and component costs (including delivery charges)
    R  
    Direct labour costs
    R  
    Product adaptation costs
    R  
    Individual and sales packaging and labelling adaptation costs
    R  
    Factory overhead (including rates and taxes, lights and water, etc.). Pro Rata
    R  
    Administrative costs (including office administration, IT systems, insurance, etc.). Pro Rata
    R  
    Production finance charges. Pro Rata
    R  
    Total cost of production   +R

    add

    Foreign research, promotion and sales costs
    Travel and accommodation costs
    R  
    Research costs (desk and in-house research costs, including research agency costs), adaptation
    R  
    Communication costs (faxes, telephone calls, etc.) R  
    Translation and/or creation of advertising material, presentations, catalogues, videos etc. R  
    Agency marketing costs and other professional fees, such as sales commissions R  
    Patent and trade mark fees R  
    Total cost of foreign research, promotion and sales   +R

    add

    Preparation for shipping costs
    Bulk packing, crating and labelling R  
    Marking of crates and containers R  
    Strapping or wrapping of crates and pallets R  
    Documentation costs R  
    Total shipping preparation costs   +R

    equals

    Total Ex Works cost of product =
    R

    add

    Export financing costs and profit mark-up
    Cost of financing R  
    Export credit insurance R  
    Discount of receivables R  
    Currency conversion costs R  
    Provision for bad debt R  
    Cost of credit checks R  
    Total export financing costs   +R
    Profit margin (Allow for unforseen costs, unavoidable risks and simple mistakes common in new undertakings)

      +R

    equals

    QUOTE FOR EX WORKS PRICE
    R

    B. Calculating a FOB price

    Start with

    Total Ex Works cost of product
    R

    add

    Inland freight costs
    Freight forwarder's fees R  
    Documentation costs R  
    Factory loading costs R  
    Local inland freight R  
    Unloading charges (including any heavy-lidt costs, if applicable) R  
    Storage charges R  
    Wharfage costs R  
    Terminal charges R  
    Additional sealing of containers requested by shipping line R  
    Non-standard container handling charges R  
    Total inland freight costs   +R

    equals

    Total FOB cost of product
    R

    add

    Export financing costs and profit mark-up
    Cost of financing R  
    Export credit insurance R  
    Discount of receivables R  
    Currency conversion costs R  
    Provision for bad debt R  
    Cost of credit checks R  
    Total export financing costs   +R
    Profit margin (Allow for unforseen costs, unavoidable risks and simple mistakes common in new undertakings)

      +R

    equals

    QUOTE FOR FOB PRICE
    R

    C. Calculating a C&F price

    Start with

    Total FOB cost of product
    R

    add

    International freight costs
    International freight/shipping charges R  
    Total shipping costs   +R

    equals

    Total C&F cost of product
    R

    add

    Export financing costs and profit mark-up
    Cost of financing R  
    Export credit insurance R  
    Discount of receivables R  
    Currency conversion costs R  
    Provision for bad debt R  
    Cost of credit checks R  
    Total export financing costs   +R
    Profit margin (Allow for unforseen costs, unavoidable risks and simple mistakes common in new undertakings)

      +R

    equals

    QUOTE FOR C&F PRICE
    R

    Calculate a CIF price quotation

    Start with

    Total C&F cost of product
    R

    add

    Marine Insurance costs
    Shipping insurance coverage (usually 110% of value) R  
    Total marine insurance costs   +R

    add

    Export financing costs and profit mark-up
    Cost of financing R  
    Export credit insurance R  
    Discount of receivables R  
    Currency conversion costs R  
    Provision for bad debt R  
    Cost of credit checks R  
    Total export financing costs   +R
    Profit margin (Allow for unforseen costs, unavoidable risks and simple mistakes common in new undertakings)

      +R

     

    QUOTE FOR CIF PRICE
    R

     

    Calculating a DDP price quotation

    Start with

    Total CIF cost of product
    R

    add

    Customs costs
    Customs duties R  
    Custom clearance fees
    R  
    Total customs costs
      +R

    add

    Destination port handling costs
    Unloading at receiving port R  
    Broker fees R  
    Storage costs R  
    Total destination port handling costs   +R

    add

    Foreign inland freight costs
    Loading charges R  
    Inland transportation costs R  
    Unloading at destination R  
    Any additional transshipment costs R  
    Freight forwarding fees R  
    Total foreign inland freight costs   +R

    add

    Export financing costs and profit mark-up
    Cost of financing R  
    Export credit insurance R  
    Discount of receivables R  
    Currency conversion costs R  
    Provision for bad debt R  
    Cost of credit checks R  
    Total export financing costs   +R
    Profit margin (Allow for unforseen costs, unavoidable risks and simple mistakes common in new undertakings)

      +R

     

    QUOTE FOR DDP PRICE R

     

 
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Step 8: more information

Step 8: Preparing your export plan
      Synopsis of research already done
      Revisiting an export SWOT analysis of the firm
      Setting the export objectives of the firm
      Preparing an export marketing strategy for your firm
                  The export product
                  The export price
                        .Step 1: Undertaking a price analysis of your target market
                        .Step 2:Costing for exports
                                    Costing guidelines
                        .Step 3: Approaches to pricing
                        .Step 4: Export pricing strategies at your disposal
                        .Step 5: The export price - your key to success
                        .Step 6: From an export price to a final selling price
                        .Step 7: Reviewing the pricing process
                  Export promotion
                  Export distribution
      Preparing an export budget for your firm
      Outlining an implementation schedule for your export activities
      Preparing and presenting your export plan
      Obtaining approval for your export plan

Click where you want to go

© Interactive Reality

More information on Step 8
Learning to export...
The export process in 21 easy steps
Step 1: Considering exporting
Step 2:Current business viability
Step 3:Export readiness
Step 4:Broad mission statement and initial budget
Step 5:Confirming management's commitment to exports
Step 6: Undertaking an initial SWOT analysis of the firm
Step 7:Selecting and researching potential countries abroad
Step 8: Preparing and implementing your export plan
Step 9: Obtaining financing for your exports
Step 10: Managing your export risk
Step 11: Promoting the firm and its products abroad
Step 12: Negotiating and quoting in exports
Step 13: Revising your export costings and price
Step 14: Obtaining the export order
Step 15: Producing the goods
Step 16: Handling the export logistics
Step 17: Export documentation
Step 18: Providing follow-up support
Step 19: Getting paid
Step 20: Reviewing and improving the export process
Step 21: Export Management
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