Unit Seven Price and Commission by leader6


									                        Unit Seven Price and Commission

重点:价格条款分类;FOB, CFR, CIF 含义; 佣金、折扣含义和不同;

学时      授 课        授课     学                    授课目标                     考核内容及办        说明
顺序      地点         类型     时                                             法
1-2     课 堂        理论     4      重点掌握价格、佣金相关基础知识                        要求深刻理解        理论目
3-4     教室         授课            (主要的价格条款、定价策略等),                       价格条款的分        标
                                 学习相关对话;                                类、含义;
                                 学习写作询价、议价、询问佣金等                        根据案例进行
                                 商务信函,总结其写作思路和常用                        报价;
5-6     网 络        理论     4      查询相关价格条款资料,反复理解                        价格条 款除        理论目
7-8     教室         授课               内涵;                                 FOB、CFR、CIF   标
                                 CIFC 价格含义的相关资料;                        外, 还有哪些条
                                                                        款?怎 么理
9-10    网 络        模拟     4      学生查询相关产品,根据所学价格                        报价风险控制; 实 训 目
11-12   教室         实训            要求,进行报价;                               利润核算办法; 标
13-14   泓 轩        企业     6      豆腐相关产品的报价实地体验;                         每项与价格相        专兼职
15-16   贸易         见习            日本东京价格的具体核算标准;                         关部分的计算        指导教
17-18                            短运、海费、海关商检手续费、码                        依据及咨询办        师
                                 头费等详情                                  法。如货代公司

I. Aims and Requirements:

In this chapter, students are required to grasp as follows:

1. Know price terms that are widely used in international trade

2. Know how to negotiate price orally and talk about price by letter

3. Master some negotiation strategies.

4. Grasp some words, expressions and typical sentences on this topic.

II. Introduction
   Price is a key term bargained by both the buyer and the seller. It may be confirmed after a long

negotiation. It is related directly with both parties’ benefits. The products’ price includes fixed

cost, variable cost and expected profit. The fixed cost and variable cost of export products mean

the total figure of production cost, selling cost, delivery cost, taxes and tariffs and some other

unknown costs. Price terms are composed of Unit Price and Total Amount. Price includes

Measure Unit, Unit Price Amount, Currency, Price Terms and Destination Port. For example,

USD100.00 CIF New York. Basically, there are three commonly used price terms: FOB, CNF and


III. Teaching tasks

Task 1. Learn some basic knowledge about price terms

Task 2 Learn some dialogues and letters of negotiate price

Task 3 Learn some negotiation strategies.

Task 4 Useful words, expressions and sentences

Task 5 Practice

Task 1. Learn some basic knowledge about price terms

1. FOB (Free On Board): 离岸价

    The seller’s obligations under FOB terms: 在离岸价条款下的卖方责任:

       1) The seller delivers the goods on the vessel appointed by the buyer at an appointed

           loading port on the date or within a period speculated in the contract according to the

           port practice.   卖方依港口惯例在合同规定的日期或期限内在指定装货港将货物


       2) The seller will bear all expenses before the shipboard of the loading goods and risks of

           goods losing or damage. 卖方负担所装货物船舷以前的所有费用和货物短重或损


       3) The seller will bear his own expenses and risks to get the export certificate or other

           official approved certificates and go through all necessary custom formalities of the

           exported goods.     卖方自行承担获取出口证或其它官方认可证件和货物出口通关

     4) The seller will offer related shipping documents or equivalent            electronic data

         materials.   卖方应提供相关货运单据或相应电子数据材料。

   The buyer’s obligations under FOB terms:        在离岸价条款下的买方责任:

     1) The buyer will charter vessel, pay freight, issue shipping advice about name of the

         vessel, loading port and delivery time.   买方租船、付运费,出具有关船名、装货港


     2) The buyer will bear all expenses after the shipboard of the loading goods and risks of

         goods losing or damage. 买方承担所装货物越过船舷以后的所有费用和短重或损


     3) The buyer will deal with insurance and pay insurance premium.      买方负担保险并交保


     4) The buyer will bear his own expenses and risks to get the import certificate or other

         official approved certificates and go through all necessary custom formalities of the

         imported goods.      买方自行承担获取进口证或其它官方认可证件和货物进口通关


2. CIF (Cost, Insurance and Freight): 成本、保险加运费价

   The seller’s obligations under CIF terms:   卖方在成本运费加保险价格条件下的责任:

     1) The seller is in charge of chartering and booking space at the appointed loading port and

         speculated period in the contract and signing a transportation contract to load the goods

         on the vessel and pay the freight to the destination as well as advising the buyer after

         loading. 卖方负责按合同规定的期限在装货港租船和订舱并签运输合同将货物装


     2) The seller bears all expenses and risks before the goods loading to the vessel.   卖方负


     3) The seller deals with insurance company and pay for insurance premium.       卖方找保险


     4) The seller goes through the export formalities and offer certificates issued by the export

         country government or related official departments. 卖方办理出口通关手续,提供由

     5) Provide related shipping documents.   提供相关货运单据。

3. CNF (Cost and Freight): 到岸价

   The seller’s obligations under CNF terms are almost the same with CIF terms except for

   insurance.   到岸价条款下的卖方责任除保险外,几乎与到岸加保险价相同。

4. Other related price terms for reference: 其它价格条款参考如下:

   FOL(Free On Lighter)             驳船交货价

   FOR(Free On Rail)                铁路交货价

   FOT(Free On Truck)               敞车交货价

   CIP                              运费、保险费付至目的地

   CPT Carriage Paid to             运费付至(……指定目的港)

   CIP Carriage and insurance Paid to 运费、保险费付至(……指定目的地)

   DCP                              运费付至目的地

   DAF Delivered at Frontier        边境交货(……指定地点)

   DES Delivered EX Ship            目的港船上交货(……指定目的港)

   DEQ Delivered EX Quay            目的港码头交货(……指定目的港)

   DDU Delivered Duty Unpaid        未完税交货(……指定目的地)

   DDP Delivered Duty Paid          完税后交货(……指定目的地)

   FRC                              货交承运人指定地点

   FOB stowed                       指卖方除船上交货外,并负担理舱费用

   FOB trimmed                      指卖方除船上交货外,并负担平舱费用

   FOB vessel                       按美国对外贸易定义解释,卖方必须在船上交货

   CIFW(Cost, Insurance, Freight and War risks)               到岸价格加兵险

   CIFC(Cost, Insurance, Freight and Commission)          到岸价格加佣金

   CIFE(Cost, Insurance, Freight and Exchange)                到岸价格加兑换费

   CIFCI(Cost, Insurance, Freight, Commission and Interest) 到岸价格加佣金及利息

   EXW EX works                                      工厂交货(…指定地点)

   FCA Free Carrier                                  交至承运人(…指定地点)

   FAS Free Along Side                               船边交货(…指定装运港)

   FOB Free On Board                                      船上交货(…指定装运港)
Task 2 Learn some dialogues and letters of negotiate price

1 Sample dialogues

Dialogue 1

A: Mr. Zhao, I am impressed with your DVD players. I am anxious to know about your officer.

B: 100 dollars per set.

A: Your price is too high for us to accept. It will be difficult for us to push sales at that price.

Could you come down a little?

B: What would you suggest?

A: Could you make it 60 dollars per set? It’s a trial order.

B: I’m afraid we can’t. So far our commodities have stood the competition well. Considering the

quality, I shouldn’t say the price is quite reasonable.

A: You mean we reduce the price by 40 dollars. I’m sorry the differences between our price and

your counter-offer are too wide. The best we can do will be a reduction of 10 dollars.

B: There’s still a gap of 30 dollars. Can we meet each other half way?

A: What do you mean?

B: Let’s close the deal at 75 dollars per set. This is the best price we can accept.

A: You drive a hard bargain, but I’ll accept this time.

B: Good. Shall we make out the contract tomorrow?

A: Fine.

Dialogue 2

A: Mr. Zhao, last time we placed a trial order for your DVD players. Now I’m prepared to place

another order. To come straight to the point, what is your lower price?

B: Lower price? Last time I made it clear that I gave you a favorable price to help you to get a

start. We can’t close any more business on the same basis, to say nothing of making a reduction.

A: Compared with what is quoted form other suppliers, your price, I’m afraid, is not competitive

at all. You know that business manly depends on your price.

B: I’m a little surprised to hear you say that. You know very well that our quality is far superior to

theirs. The price is the same as we offered last time.
A: No doubt yours is of high quality, but our offer is the rock bottom price. The best we can do

will be a reduction of 5 dollars per set. This is your lower price and we can’t go any further.

B: All right. I will accept your proposal.

2. Sample letters

(1) Asking for Discount

 Dear Zhang,

 Thanks for your quick response in details. On reference to your HCO, we are satisfied with

 your specifications and quick delivery promise. But your price is much too high. Could you

 give us a discount of 10% if we order a large quantity over 200mt this time? Payment is to be

 made by irrevocable L/C at sight. We will place regular orders for at least 100mt each month.

 Waiting for your acceptance.

 Best .regards.

 Jones (CEO)


(2) Reply to asking for a discount

 Dear Jones,

 Thanks you very much for your email today. We are so glad to establish good business

 relationships with your company and we will offer you best price. But your suggested 10%

 discount of the price is not acceptable. In consideration of the long term cooperation, we will give

 you a special price of 5% discount based on an order over 200mt. This price is the first time we

 offered only to you.

 Waiting for your order.
 Best regards

 Starter Zhang

 ChemChina Oil and Fat Co.,Ltd.

 Tel: 86-536-8880111

 Fax: 86-536-8880001

 E-mail: chem@caschem-china.com

(3) Asking for Commission

 Dear Zhang,

 We are distributor and trading company in America. We get your name from Mr. Jones of CasChem

 company. Your first grade of HCO is in superior quality and accepted by our customers. We want to

 place a regular order of 150mt each month. Could you accept a price with commission of 5% for this

 product? It is appreciated to get your best price CIFC5 New York. We are sure to pay by L/C at sight.

 Your quick response is appreciated.

     Best regards


     Chemical Trading Company.

     E-mail: chem@chemtop.com

(4) Reply to asking for commissions
 Dear Smith,

 Thanks for your interest to our HCO. Mr. Jones is our old friend and one of our best partners for

 years. We believe we can have best cooperation in this field too.

 You are so familiar with our products and what we should be focused is the point of price and

 commission. In general, we don’t allow any commission. But in consideration of our future

 cooperation, we will make our effort to solve the commission problem. We may offer you a best

 price CIFC5 USD1875/MT NY. We appreciate your payment by L/C at sight and we guarantee to

 effect the delivery within 15 days after receiving your L/C.

 We are looking forward to your early reply and firm order.

 Best regards

 Starter Zhang

 ChemChina Oil and Fat Co.,Ltd.

 Tel: 86-536-8880111

 Fax: 86-536-8880001

 E-mail: chem@caschem-china.com

3. Writing skills

(1) Asking for Discount

  a.   Thanks

  b.   Attitude to price offer.
  c.    Too high of your offered price

  d.    Ask for a discount based on a large order

  e.    Attract the supplier’s attention

  f.    Wishes

  g.    Contact information

(2) Reply to ask for discount

  a. Thanks

  b. Discount rate unacceptable

  c.   Accepted concession

  d. Special price with large order

  e.   Wishes

  f.   Contact information

(3) Asking for commissions

  a.   Thanks

  b. Important customer

  c.   Import in large quantity

  d. Ask for commission

  e.   Best price with commission rate

  f.   Attract the supplier’s attention

  g. Wishes

  h. Contact information

(4) Reply to ask for commissions

  a.   Thanks

  b. Friendship and relations consideration

  c.   Commission allowed or not allowed

  d. Commission rate and price offer

  e.   Delivery suggestion with good service

  f.   Wishes

  g. Contact information
Task 3 Learn some negotiation strategies.

Attract Customers: Strategies of Quotation Online

1. Good preparation before offer 报价前充分准备

    Firstly, we should study the purchasing intention of the customer carefully research their real

    demands, then draft a better price list deliberately. Some customers regard price as their

    decisive factors. Therefore, we should make an offer with an approximate bottom price. After

    knowing well about the purchasing intention of the customers, we may decide whether we

    should make a non-firm offer or a firm offer.

2. Choose appropriate price terms         选择合适的价格术语

    Price term is a key part of an offer. The price term will decide the classification of obligations,

    rights and profits of both the seller and the buyer. Therefore, the seller should know the real

    content of all kinds of price terms and select one carefully besides trying to meet the

    customers’ requirements before drafting an offer.

3. Choose an appropriate quotation ways 选择合适的报价渠道

    You may quote directly when you are doing business online. We learn this part by introducing

    quotation ways on Alibaba.com. The functions on Alibaba.com will only serves for Golden

    Supplier members.

4. Take use of other key terms of the contract          利用合同其它要件

    Other key terms of a contract include: payment, delivery time, shipment term and insurance

    term. Price is only one of the terms. The price will be more flexible if we negotiate with the

    customer considering the other key terms.

5. Succeed by a comprehensive power            以综合实力取胜

    If you are confident to your comprehensive power, you may not always satisfy the buyers with

    a lowest price. You should be expertise to make your offer and ask some professional

    questions before and in your offer. This is to express you are so familiar and professional in

    the products and this line.

Task 4 Useful words, expressions and sentences

Words and expressions
1. competitive price     有竞争力的价格

    修饰价格的常用词还有:(low, lowest, best, bottom, rock bottom) price: (最)低价

    reasonable price 合理价, favorable price 优惠价, special price 特价, target price 目标价,

    current price 现行价, prevailing price 现行价, market price 市场价,等等。

2. sales manager 销售部经理


    president                 董事长                  vice president              副董事长

    general manager           总经理                  vice general manager        副总经理

    executive director        执行董事                 [senior]advisor             [高级]顾问

    auditor                   监事                   department manager          部门经理

    section manager           科长                   assistant section manager   股长

    general secretary         总书记                  chief engineer              总工程师

    chief accountant          总会计师                 head coach                  总教练


1. Price is hovering between $5 and $8.

2. We regret we have to maintain our original price.

3. It simply can't stand such a big cut.

4. This new product is moderately priced.

5. Everyone knows, the price of crude oil has greatly decreased.

6. We've already cut the price very fine.

7. The French price of stainless steel plates are about $1200 per mt, while the German price is

    still lower.

8. We're ready to reduce the price by 5%.

9. To have this business concluded, you need to lower your price at least by 3%.

10. Business is possible if you can lower the price to HK$2150.

11. The utmost (best) we can do is to reduce the price by 2%.

12. We cannot take anything off the price.

13. We've already cut down our prices to cost level.

14. There is no room for any reduction in price.

15. Our rock-bottom price is $500/mt, and cannot be further lowered.
16. DM210 is equivalent to 400 RMB.

17. Don't you wish to employ RMB of ours? US Dollars might be adopted.

18. Are you afraid of losing money due to exchange rate fluctuations?

19. I can give you a definite answer on the price terms.

20. In case F.O.B. is used, risks and charges are to be passed over to the buyers once the cargo is

    put on board the ship.

Task 5 Practice

I. Oral Practice.

  Make a dialogue according to the following situations and requirements:

  You are a Chinese exporter of printed poplin (印花毛葛:由丝、人造丝、羊毛或棉花织成的

  有罗纹的织物,用来做衣服及装潢) and pongee(茧绸;山东府绸:一种轻柔的薄布料,

  由中国或印度产的原丝或它们的仿制品织成), you are bargaining with the buyer on the

  following requirements: 1) product name 2) expressions of price term 3) ask for a lower

  price 4) the reason of a higher price 4) quantity consulted 5) discount 6) agreement

II.Writing practice:

Write an English letter according to the following Chinese letter.


     你 3 月 25 日函悉,谢谢。我们已仔细研究了你方对我氢化蓖麻油产品报价的意见。




     我们准备给百分之五的折扣,条件是你方起订 1000 吨。如果此建议可接受,请早

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