Operation Management, Pricing Strategies, Sku System, Inventory Management

3558 WordsAug 20, 200815 Pages
Operation Management criteria The task of production and operations management is to manage the efforts and activities of people, capital, and equipment resources in changing raw materials into finished goods and services. Operations management is an area of business that is concerned with the production of goods and services, and involves the responsibility of ensuring that business operations are efficient and effective. It is the management of resources, the distribution of goods and services to customers, and the analysis of queue systems. Pricing is one of the four p 's of the marketing mix The effective price is the price the company receives after accounting for discounts, promotions, and other incentives. Price lining is the…show more content…
More technically, this form of pricing exploits the general cognitive bias of aversion to extremes. This practice is known academically as "framing". By providing three options (i.e. small, medium, and large; first, business, and coach classes) you can manipulate the consumer into choosing the middle choice and thus, the middle choice should yield the most profit to the seller, since it is the most chosen option. Demand-based pricing is any pricing method that uses consumer demand - based on perceived value - as the central element. These include : price skimming, price discrimination and yield management, price points, psychological pricing, bundle pricing, penetration pricing, price lining, value-based pricing, geo and premium pricing. Pricing factors are manufacturing cost, market place, competition, market condition, Quality of product. Multidimensional pricing is the pricing of a product or service using multiple numbers. In this practice, price no longer consists of a single monetary amount (e.g., sticker price of a car), but rather consists of various dimensions (e.g., monthly payments, number of payments, and a down payment). Research has shown that this practice can significantly influence consumers ' ability to understand and process price information Questions involved in pricing Pricing involves asking questions like: • How much to charge for a product or service? This question is that a typical starting point for

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