Pricing Strategies of Itc

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Pricing Strategy ITC Foods Business Division (Staples) The FMCG & RETAIL Pricing Strategy UNDERSTANDING THE PROCESS FMCG Pricing Strategy is now a critical element of the management mix. Old school management responsibilities of Sales owning the trade spend budget and customer negotiations with marketing owning the Recommend Retail Price do not work in today 's information driven age. Retail sales volume is now 80% controlled by 2-3 chains with a scattering of independent operators making up the rest of the volume. This concentration means the negotiations favour the retailer with the supplier handing over margin via the mechanism of trading terms and via the demand for increased promotional…show more content…
The Geographical location in terms of the liking and usage of the product .as in ATTA is a product of daily use in the NORTHERN and EASTERN Region hence the product for sale are majorly categorize under the Economy strategy as the volume sales can be only achieved then. 2. Similarly the product WHOLE WHEAT ATTA for example in the south is a special diet hence this allows to introduce the premium brand here and people will buy it. 3. One approach was about keeping the price of the product different in the regions where people have more disposable Income and High Purchasing Power. Some factors relating to pricing Methodology: Pricing Objectives The Foods Business (ITC Ltd.) Pricing objectives identified are in order to determine the optimal Pricing Common objectives include the following: • Current revenue maximization - seeks to maximize current revenue with no regard to profit margins. The underlying objective often is to maximize long-term profits by increasing market share and lowering costs. • Maximize quantity - seeks to maximize the number of units sold or the number of customers served in order to decrease long-term costs • Quality leadership - use price to signal high quality in an attempt to position the product as the quality leader. Pricing Methods To set the specific price level that achieves their Pricing objectives, managers may make use of several Pricing methods. These methods include: •
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