Wednesday, 15 March 2017

What are price building process and rules of fair trade in logistics?

When the seller is working towards achieving the highest revenue at the lowest cost and the buyer is looking for the best benefits for the lowest price, it is price building. It’s like a competition and the result is never known. There are some market rules to follow during the price building process. Some of the rules are law and therefore they have to be followed, others are general. The regulations that are not law can be agreed upon by the seller and the buyer in the process. Following t he rules of fair trade should not be negotiable for either party. Let’s take a look at some of them:

·         The rules must be accepted by both parties before trading starts
·         Both parties must follow the rules
·         Rules shouldn’t be changed, removed or cancelled during the trade
·         Both parties must not take advantage of an emergency
·         When the rules are lacking, the price building process is halted until the regulations have again been agreed upon
·         No one is forced to participate in a trade
·         No one should be hindered if they meet the admission criteria

Disputes in the process of price building will need to be settled by a neutral party that’s accepted by both parties before the trading commenced. The neutral party should be an authority, such as an expert or consultant. 

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