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has reference to your request for a review of our pricing
structure as outlined in your letter of June 15. In the letter
you mention a need for a straight 10% reduction across our
full product range to “match recent reductions”
carried out by your competitors, which you documented.
In line with your request we are reducing our F.O.B. prices
to you 5% retroactive to June shipment. This is the maximum
that we can do for you at this time. Even this 5% reduction
represents a considerable sacrifice in our profits, a sacrifice
that we expect you to match.
Please understand that we are always willing to consider
ways to assist you in making your operation more competitive.
We also recognize that an import price reduction is one
way. However, in analyzing the supporting data you provided,
we noticed that at least parts of our competitor’s
reductions were being accomplished by deleting accessories
previously included in the package. This sort of creative
pricing strategy is another approach you should promptly
consider.
We look forward to receiving a full report on your new
pricing strategy soon.
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