Factors that influence Pricing

Chapters: - Tuesday, October 6, 2009

COST BASED PRICING- accountant's approach

  • calculating unit cost and adding mark-up or margin 2 provide profit.
  • unit cost may reflect full, production or variable costs only.
  • profits may reflect risk involved in the product; competitor's mark up; desired profit; type of costs; type of product.
CUSTOMER BASED PRICING- marketer's approach
  • reflects customer's percepyiyionof the benefits they will enjoy 4m the product.
  • greater the understanding that you have of ur customer, the better placed you are to price the product.
COMPETITION BASED PRICING
  • setting a price based upon the prices of competing product.

0 extra marks:



Post a Comment