BUYERS: TARGET PRICE

August 15, 2022
Today I would like to talk to you about "target prices.

Indeed, the "target prices" imposed by buyers can also be the cause of the failure of deals. When buyers offer "target prices" that are too low or disconnected from market reality, this can lead to several problems:

A) Target prices that are too low can discourage potential sellers because they are not willing to sell at a price lower than their cost of production or at a price that does not cover their costs.

B) Target prices that are too low can lead to an imbalance between supply and demand. If buyers are unwilling to pay a reasonable price, sellers may choose not to offer their products, creating a shortage in the market.

C) Very low target prices can make negotiations difficult, if not impossible. sellers may be reluctant to enter discussions that seem doomed from the start.

D) If target prices are too low, sellers risk incurring significant losses or not being able to make sufficient profits to cover their operating costs.

E) If buyers impose unrealistic or uncompetitive target prices, it can harm their credibility and reputation in the market.

To avoid these problems, it is essential that buyers work closely with sellers and intermediaries to understand market conditions, production costs, reasonable profit margins and specific seller constraints. Negotiations should be based on real data and market analysis, while considering the interests and needs of both parties.

In the oil trade, transparent and fair negotiations are essential to ensure successful deals and maintain trusting relationships between buyers and sellers.

However, unfortunately, some scammers may use the concept of "target price" to conduct trading scams. They may claim to have access at very low prices or promise unrealistic returns to potential buyers, to entice them to invest money in a supposedly lucrative opportunity. In many cases, these offers are too good to be true and may be fraudulent attempts to extort money from victims without ever delivering the promised product.

To protect against scams related to "target prices" in trade (or in any other field), here are some important tips:

1. Do thorough research on the intermediary or company you are dealing with. Check their reputation, credentials, and look for reviews or reports of possible scams.

2. Be cautious of offers that seem too good to be true. If an offer seems too attractive, it may be a sign of scam.

3. Ask for verifiable information and documents regarding the product, suppliers, licenses and certifications, and contract terms.

4. Avoid paying money in advance without having obtained solid and verifiable guarantees on the validity of the offer.

Caution, due diligence, and common sense are essential to protect against potential scams related to "target prices" and to avoid becoming a victim of a scam in the field of trading or any other sector.