Case study 3 pricing and performance

Case study 3 pricing and performance

Question 1: From the given last two years sales figure, it is showing an average of 4% price is increased in every boat. Based on last 2 years pricing pattern and the condition attached with B16 & B35.Before considering the price of B33, Billing Boats AS has to think about the challenge of B29 and market popularity both of these two boats .After considering all these factors the manufacturer’s selling price for the next year can be followed by:
B16 30,888
B29 310,000
B33 356,000
B35 216,216
Therefore, other two boats consistently B29 & B33, cost of production for B29 mostly less the half of cost of B33’s production. So here, price for B29 can be considered cheaper than B33, however B29 newly entering in market, therefore, its has more potential catch market attractions comparing with B33. Inaddition, making B29 and its price has to be careful while it will not impact on B33 Sales.
Furthermore, considering customers attractiveness about B29 ,price should remained for B33and unit of boats could be remained .
On the other hand Price for B29, should be less than B33 and a higher price comparing it’s variable cost .Because Company have to pay a huge fixed cost for design and royalty fee .

Question 2: The CIF prices for the B29 and B33 to the importers in Denmark, Sweden, Poland, the UK, Germany, and Russia is cited bellow

B29 prices

310000

Denmark
Sweden
Poland
UK
Germany
Russia

CIF cost

14,500
13,500
19,000
24,500
225,000
26,000

Exchange rate
0.73
0.73
2.02
11.31
7.71
4.22

Inflation Rate
3%
1%
22%
3%
2%
15%

CIF Price

457856.2
447582.2
198703
30462.86
70778.21
91563.98

B33 Price

356000

CIF Price

522760.3
511226
226485.1
34652.08
76280.16
104099.5

Question 3

Product
Quantity
Price

Revenue

B16
288
30,888

8895744

B29
40
310,000

12400000

B33
36
356,000