Identify and Evaluate Clearwater Technologies Existing Pricing on the Qtx Line

1057 WordsJul 1, 20155 Pages
1. Identify and evaluate Clearwater Technologies existing pricing on the QTX line. What are its pricing objectives? With the introduction of the upgrade, should Clearwater reconsider its pricing strategy? The existing pricing: Number of seats | To end users | Unit cost | Actual unit cost | 10 | 8,000 | 500 | 900 | 20 | 14,000 | 700 | 900 | 30 | 17,250 | 900 | 900 | According to table 1 and 2, because Clearwater is upgrading its products right now, they will design the 30-seat server, so even the customer just want 10-seat or 20-seat, Clearwater will still ship them the 30-seat server with just 10 or 20 seats usable. So in this case, the actual cost of the server will all be 900 dollars. The pricing objectives: For the…show more content…
2. The Sales Manager Brian James: New 30-seat unit 17,250 Original 10-seat unit 8,000 | Price for 20-seat unit 9,250 And the final new 20-seat unit price will be 14,000 For this pricing option, he didn’t increase the original prices of both 30-seat and 10-seat. Instead, he simply calculated the 20-seat price by using the difference between 30 seats and 10 seats. In the positive aspect, this pricing strategy is actually fair enough for the current customers, because he didn’t change anything to the current price. Obviously this strategy will help Clearwater to gain more customers loyalty, and probably they will get more orders. But on the other hand, after all the company was changing the product system because they want more profits, the pricing strategy provided by Rob was clearly ran in the opposite direction. I think it’s a little be less aggressive for the product manager to actually decrease their prices. Fortunately the profit margin for the QTX is good enough, so they can still make remarkable profit on it. 3. Hillary from Financial Department: She suggested that they should be more aggressive and set the price at 15,000 or even 20,000 (I think she means the price for 20-seat, I’m a little bit confused here) 4. What should the final price be?
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