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SPPI FOR WHOLESALE TRADE IN ISRAEL

SPPI FOR WHOLESALE TRADE IN ISRAEL. Ruth Vizner Central bureau of statistics. 23rd Voorburg Group meeting. Aguascalientes, Mexico 22-26 September 2008. Topics. Output definition Market condition Classification National accounts Pricing methods Quality adjustment.

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SPPI FOR WHOLESALE TRADE IN ISRAEL

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  1. SPPI FOR WHOLESALE TRADE IN ISRAEL Ruth Vizner Central bureau of statistics 23rd Voorburg Group meeting Aguascalientes, Mexico 22-26 September 2008

  2. Topics • Output definition • Market condition • Classification • National accounts • Pricing methods • Quality adjustment

  3. Definition of the service (1) • The resale (without transformation) of goods from manufacturer to a third party: retailers, industrial, commercial, institutional or professional users or other wholesalers, or involves acting as an agent or broker in buying goods for or selling goods to such companies.

  4. Definition of the service (2) Related services • Transportation • Warehousing • Promotions • Marketing • Packaging • Assortment building • Other services

  5. Definition of the service (3) Two types of wholesalers: • Merchant wholesalers Buy and sell goods on their own account (wholesale merchant or jobbers, industrial distributors, importers, exporters and cooperative buying associations) • Agents and brokers Receive a commission or fee

  6. Type of wholesalers Wholesale on a fee or contract basis Wholesale that take title to the goods Manufacturer’s sales and branch offices Agents and brokers Wholesale merchants

  7. Origin and destination of goods Intermediate buyer: Retailer Industrial institutional Other merchant Local manufacturer Wholesale trade Final Customer import export International manufacturer International customer

  8. Market Conditions (1) In 2007 • Industry revenue US$ 55 billion • 22,733 dealers • 17.7 percent of revenue in all industries • Market share of big companies ~70% (3.5 percent of dealers with revenues US$ 40+ million accounted ~ 70% of revenue)

  9. Market Conditions (2) Wholesale trade includes domestic as well as international wholesale trade In 2005 • Import of goods ~ 25% of revenues • Export of goods only ~ 4% of revenues

  10. First group to develop 512 - “wholesale trade of agriculture raw material, live animals, food, beverage and tobacco” 5121 - Wholesale of agricultural raw materials and live animals includes: grains and seeds; oleaginous fruits; flowers and plants; unmanufactured tobacco; live animals;hides and skins;leather; agricultural material; waste, residues and by-products used for animal feed 5122 - Wholesale of food, beverages and tobacco includes: fruit and vegetables; dairy products, eggs and egg products; edible oils and fats of animal or vegetable origin; meat and meat products; fishery products; sugar, chocolate and sugar confectionery; bakery products; beverages; coffee, tea, cocoa and spices; tobacco products

  11. Group 512 In 2005 • The biggest, ~ 27% of revenue • US$ 11,591 million Special conditions • Fluctuations in the prices of goods in global markets • Changes in exchange rates • Competition • Mergers and acquisitions • Globalization and new technologies

  12. ClassificationISIC Rev 3

  13. other Classification (ISIC Rev 4)

  14. other Classification(CPC)

  15. Classification • Detailed information and description of products and services. • Distinction between wholesale trade on own account and on a fee or contract basis. • Classification according to the function and kind of product (food, household, machinery). • Distinction between specialized and non specialized wholesale trade (in ISIC rev 4).

  16. National accounts issues • How to measure prices of output for subsidiaries units of a manufacturing enterprise? (Units thatsell manufactured products made by the parent company ). • How to estimate export in wholesale trade ? (export of services / export of goods).

  17. Pricing methods Gross margin price. The difference between the acquisition price from the supplier and the selling price to the next buyer. There are some cases: (I)the average gross margin per unit for a particular customer class and/or supplier class for all sales within a product group. (II)the average gross margin per unit for a particular customer class or supplier class for a specific kind of product. (III)the average gross margin for all customers and/or suppliers for all sales of a particular product. (IV)the average gross margin for all customer and/or suppliers for all sales of a product group. (V) margin price for an item / transaction.

  18. Margin Price

  19. Price determining component include Product information - Type of product - Unit of measure - Origin of product - Additional services Transaction information - Type of costumer - Type of supplier - Size of transaction Quality adjustment methodology

  20. Example of service description

  21. Another example

  22. THANKS QUESTIONS?

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