Market structures and pricing Revenues Consumers * Inverse demand curve gives willingness-to-pay * Benefit consumer(s) derive(s) from additional good; * Area under inverse demand curve measures total willingness-to-pay‚ total benefit or total surplus. * Maximum price I can charge as producer determined by inverse demand function * Marginal revenues; revenue of next unit I sell Strategies * Profit maximization * Marginal profits equal to 0 (MR=MC) *
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services is worth to the customer. 2. Pricing decision is usually viewed as a way to recover cost‚ but we need to take the customer into the account/ consideration. The price could be higher than customers are willing to pay for that product. 3. The major factors affecting price are: a. Marketing Strategy b. Customer perceived Value c. Competition d. Cost 4. Role of Marketing Strategy in Pricing a. Price should be consistent with the pricing strategy. b. Target market decision affects price
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Swing v. Steady Swing Manufacturing and Steady Manufacturing both operate in the widget industry‚ but with radically different cost structures. Swing is a capital-intensive‚ automated manufacturer‚ while Steady is a labor-intensive "job-shop." Monthly operating data are as follows: | |Swing Manufacturing |Steady Manufacturing | |Sales |5‚000 units |5‚000 units | |Price
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E. Pricing Strategy FARMERS GRANARY PRODUCT COSTING Production cost per hectare for 110-120 days Direct Expense Urea Fertilizer Php 6‚300.00 Pesticide 2‚4-D Amine Weed Killer Php 500.00 Surekill Molluscicide Killer Php 960.00 Php 1‚740.00 Sacks 200 pieces Php 2‚600.00 Seeds (Hybrid) Php 23‚050.00 Total Direct Expense Php 33‚690.00 Indirect Expense Fuel Php 500.00 Irrigation Php 1‚200.00 Kuliglig or Two-wheeled
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Running head: IMPLEMENTING PRICING STRATEGY Implementing Pricing Strategies Janaina Logan Strayer University Strategic Market Pricing – MKT 402 Professor Charla Session-Reed March 18‚ 2011 Abstract Implementing pricing strategy decisions requires properly addressing organizational issues related to how decisions are made and enforced as well as motivational issues that encourage managers to engage in more profitable behaviors. Pricing decisions are strategic and
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Part IV. The global marketing mix 2. Global pricing strategy 1 Cheap and cheaper… 2 Expensive and more expensive… 3 1. Basic pricing concepts Introduction Price: the amount charged to customers/consumers in exchange for goods or services Market price: the price that prevails in the market for a particular good at a specific time 3 key elements of market price: supply‚ demand and time Eg: hotel prices – peak season during summer – higher prices driven by the demand (more
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why we launch this clothing line is for students‚ lower-wage workers who do not have enough money to spend for cloth‚ but who also want to wear new brand shirts almost everyday. And they are our target in the markets now. But‚ of course‚ you can also purchase these clothes in aspects of intelligent purchasing. So in short‚ this new clothing line is for the common man. As you buy this one shirt‚ you can get the 7 different color shirts. So its a 7 in 1 offer! How? Well If you buy this shirt‚ we will
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How Starbucks Uses Pricing Strategy for Profit Maximization by Tucker Dawson Last Thursday Starbucks raised their beverage prices by an average of 1% across the U.S‚ a move that represented the company’s first significant price increase in 18 months. I failed to notice because the price change didn’t affect grande or venti (medium and large) brewed coffees and I don’t mess with smaller sizes‚ but anyone who purchases tall size (small) brews saw as much as a 10 cent increase.The company’s third quarter
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services. Pricing is a key determinant in the decision making process customers use to purchase a product or service. It is important to establish how much the target market will pay for the product or service. The fastest and most effective way for a company to realize its maximum profit is to get its pricing rights. The right price can boost profit faster than increasing volume will the wrong price can shrink it just as quickly without realizing it. AN OVERVIEW OF DAFFODIL UNIVERSITY: Daffodil
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areas that they serve‚ which are not serviced by their competitors‚ like Africa. - Differentiation premium could be charged on high speed which currently DHL doesn’t do specially for parcels product line. Although DHL is cautious in charging for this differentiation because of lack of guarantee‚ their advertisements and strength are in that regards. - Value added services such as package tracking technology‚ consulting for international shipping requirements are offered for free within the shipment
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