Prof. Dr. Reinhard Hünerberg
Explain major aspects of the transfer price problem(internal pricing)
In my opinion the major aspects are the difference of currency, taxes, work labor, suppliers, etc… The pricing play a important role tomade decisions for best profit in a company, because before you decide expand you market in a foreign country you must to known how these country arewith the taxes and other factors, in one hand you can maximize your profit because the currency profits are bigger than the others countries, the work laboris cheaper and also the taxes and the suppliers. But in other hand you must to considerate the price and problems of the logistic, one country could nothave the best infrastructure for yours needs.
Also the stability of the country is very important to keep in mind, because when you made an economicplan and this plan looks very profitable in near future in the foreign country but perhaps in five years all the rules and law could be change and theplan in the long-future could be no best for the company and all the money was investment could be lose.
Moreover before you made a decision to move orexpand you company you plan should be flexible, because many factor are in constant changes, if you all ready know and have the experience in one foreigncountry could be the best decision you could have, in these time and in the future the emergent country are the best place to invest.
May 26th 2010