Asked by jazell freeman on Jun 25, 2024
Verified
What type of negotiating strategy requires the supplier to open its books to the purchasers?
A) cost-based price model
B) market-based price model
C) competitive bidding
D) price-based model
E) fair value price model
Cost-Based Price Model
A pricing strategy where the selling price is determined by adding a mark-up to the total cost of production.
Open Its Books
The act of a company revealing its financial information, including revenues, expenses, and profits, to the public or specific entities.
- Understand fundamental negotiation tactics within supply chain management, incorporating the market-based pricing approach.
Verified Answer
KS
Kasey SouvannaleuthJun 27, 2024
Final Answer :
A
Explanation :
The cost-based price model requires the supplier to open its books to the purchasers in order to ascertain the actual cost of goods or services being supplied. This allows the purchasers to negotiate a fair price based on the supplier's actual costs, rather than an inflated price based on market trends or other factors.
Learning Objectives
- Understand fundamental negotiation tactics within supply chain management, incorporating the market-based pricing approach.
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