Ex-factory pricing refers to the price charged by a manufacturer for a distributor or other buyer to purchase goods directly from the manufacturer. This is a price only for the goods. It excludes shipping, handling, and taxes. This is a regular occurrence when working with raw materials for secondary production.
Ex-factory pricing is the exact price charged by a manufacturer for products as they leave the plant. Frequently, wholesalers and distributors acquire these items directly from the factory floor or loading docks and arrange for their own delivery. This method assists merchants in regulating their prices while collaborating with a third party.
The manufacturer alone determines the ex-factory figure. Not included in the price are taxes, surcharges, or shipping and handling costs. Major retailers attempting to maintain price margins within a specific range appreciate it because the price is often cheaper than what a buyer may obtain when dealing with a secondary shipping provider as an intermediary.
Exporting and importing services frequently utilise ex-factory pricing. These pricing allow businesses to acquire goods from loading docks and shipping yards without incurring additional transit costs. By requiring a change of hands between producers, distributors, and shipping companies, the method also permits the regulation of the transit of commodities between nations.