Pricing Choices Should Anticipate Competitor Reactions

Price is an important factor in the marketing mix not only because it drives revenue and business sustainability, but also because it acts as a signal of value to consumers. Consumers often use price as a way to gauge quality or exclusivity. Moreover, price can also help segment the market, by customer, product-form, location, time-basis, or price sensitivity. By offering products at different price ranges, a wider range of consumers can

Pricing is a pertinent issue in procurement and acquisition in organizations. Consumers buying the commodities of an entity should get clarity on pricing related issues. There is uncertainty in Pro

A product that brings positive benefits to the customers should not set its price at a very low rate as it will devalue the product and lost credibility for the benefits that the product has promised. In addition, the price should not be over $ 20 as research has been conducted to show that very few customers are willing to pay above $20 for the product.

price setting is based on the materials and will be positioned to a reasonable market

Consequently, once you understand your costs and your maximum price, you can make an informed decision about how to price your product or service. (Allen, 2012)

Establishing the value of a product or service is not easy. A wide variety of relevant factors such as the cost of goods or services, the market factors, sales volume, competition, economic conditions, must be taken into consideration. Although, price desideratum is an ideal hard to reach, the price should be high enough to cover the costs and generate revenue.Pricing it may have different guidelines. The most relevant pricing strategies are cost-based pricing, value-based pricing, and competition-based pricing.

A company’s pricing strategy can offer a low price to stimulate demand and be able to gain market share as it focuses on specific economies in administration, production and marketing, striving to be as lean as it can without diminishing the overall level of quality it chooses to produce and be known for in the market (Heiman, 2010). One of the many difficult decisions a company has is to have a detail understanding of planning the costs that are involved in producing a product, delivery, service as well as factoring in the organization to set their pricing. Therefore, a critical component of the pricing is to understand the market demand, life cycle and the competitors actions would assist in deciding how to price your products and

– Potential pricing strategies that take into account how much consumers are prepared to pay, thecompetition and possibilities for discounts.

The key to a successful business is creating a specific detailed strategic marketing plan outlining product pricing. It is important for the marketing plan to include product pricing strategies in anticipation for the fluctuation of competing products and consumer demands. In the article Prices Marketing Strategies by Adrian Gherasim (2012), the article details the various methods to price product from creation, when competition enters the market, to when price adjustments should be made. Marketing strategies should take into consideration supply and demand when determining prices since pricing will consistently need to be adjusted depending on the market. Marketing strategies should continue to follow marketing trends to increase and decrease product prices in order to maximize profit.

Companies today recognize that they cannot appeal to all buyers in the marketplace, or at least not to all buyers in the same way. The reason are follow:

For decision-making purposes, product cost information is one of the most important inputs for pricing decisions or product-mix decisions. Organisations that sell highly customized or differentiated products or services, or who lead the market, have some choice in setting their selling prices. The pricing decisions can be influenced by the cost of the product. Other organisations have their selling prices set up by the market as they only have little or no power over the selling prices of their products. However, cost information is still considerably important for

For reflecting the company’s objectives and market conditions pricing strategies needs to be applied. Market conditions, competition, quality of the product, market place are the factors that influence of the product pricing. If the company has chosen a good pricing strategy for their products they will have good profit and good company positioning on the market in return. For setting the prices for products the Pricing strategy matrix can be used.

Pricing policy refers to how a company sets the prices of its products and services based on costs, value, demand, and competition. Managers should start setting prices during the development stage as part of strategic pricing to avoid launching products or services that cannot sustain profitable prices in the market. This approach to pricing enables companies to either fit costs to prices or scrap products or services that cannot be generated cost-effectively. Through systematic pricing policies and strategies, companies can reap greater profits and increase or defend their market shares.

Product/service price: Every company, organisation, restaurant or any business want to make money. And that is

The prices a company sets for its product and services must strike a balance between gaining acceptance with the target customers and making a profit for the organisation.