Local realities.
WHAT AFFECTS PRICING HERE
Exchange rate movement, for imported goods Fuel and transport costs Power costs, where you generate your own Inflation Customer price sensitivity
THE EXCHANGE RATE PROBLEM
For imported goods, your replacement cost may exceed what you paid.
Pricing on historic cost means you cannot afford to restock.
WHAT TO DO
Price on replacement cost, not purchase cost.
FOR VOLATILE COSTS
Shorter quote validity periods.
"This quote is valid for seven days" is reasonable and increasingly necessary.
WHAT TO STATE
Validity period on every quote.
FOR LONGER PROJECTS
A clause allowing adjustment if material costs move significantly.
Agree it at the start rather than raising it later.
CUSTOMER PRICE SENSITIVITY
Real, and price is not the only factor.
Reliability, availability and service matter, particularly where both are inconsistent.
WHAT NOT TO DO
Absorb rising costs indefinitely to avoid a difficult conversation.
