How merchant exporter can negotiate successfully with local suppliers and also with international buyer?

Price is the most important factor for the merchant exporter; as international market is most competitive market. In trading business you do not get what you deserve; but you get what you negotiate. It is very important that merchant exporter should develop the skill of negotiation for procurement of goods with competitive rate from the suppliers. He is also required to develop the skill of finding the international buyer at the best selling rate.

The merchant exporters should have the fair knowledge of the price at which he should procure the materials. He should have fair knowledge of the price of the goods from different suppliers and also different locality of his country.

Merchant exporter should always aim to get the longest possible validity of the offer. This will avoid in approaching the supplier again and aging for the price. Generally it requires a long time forgetting the international orders. So your price should remain valid up to the procurement of goods form the supplier.

Merchant exporter should study the product in detail with reference to various specifications of the products. He should request the supplier for those specifications which are demanded by the buyer.

 Higher is the quantity lower is the price; is the basic principal of trading. Merchant exporter gets the goods in lesser price if he orders the higher quantity of goods to the supplier.

The merchant exporter can attract the interactional buyer on the basis of competitive price, good quality and timely delivery. If he is able to prove these three factors than he is able to get more and more order.

Merchant exporter can also attracts the international buyer if he provides some value addition services like packing, re-packing, labeling, re-labeling, kit making, set making etc.  It means; he is not only act as trader but also act as service provider.

While quoting the price to the international buyer merchant exporter should prepare his cost sheet for the proposed order. He should be considered all the cost in his cost sheet including cost of the goods, packing cost, clearing forwarding charges, shipping cost, certification fees, bank charges, transportation cost form supplier’s place to the port, etc. Export incentive also needs to consider while quoting the price at competitive rate.

Buying at competitive rate from the supplier and selling at the best rate to the international buyer makes the merchant exporter successful.

CA Rajendra Shete
The author is FCA, Dip. IFRS (ACCA, UK). He is practicing Chartered Accountant since 2004. He can be reached at ca.rajendra.shete@gmail.com. CA Rajendra Shete is the author of the book The Rules and Red Flags. - To know more about the book pls visit !

Leave a Comment