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Determining the correct price

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Presentation on theme: "Determining the correct price"— Presentation transcript:

1 Determining the correct price
elling Price Determining the correct price

2 And Selling Price is? Selling Price- The amount a seller charges for a good or service All businesses follow a process to determine prices Selling prices are dynamic

3 Components of Selling Price

4 Importance For Business For Customers Determine income from sales
Reach company goals For Customers Product comparison Money allocation decisions

5 Should be compatible with marketing objectives.
Pricing Objectives Should be compatible with marketing objectives. May change over time

6 Pricing Objectives-Sales Oriented
What is the purpose? To increase the total amount of income from sales Objectives: Creating an image Be more competitive Obtaining, maintaining, or increasing market share

7 Pricing Objectives- Profit Oriented
What is the purpose? To create profits for the business Objectives Surviving Maximizing Profits Earning return on investment Earning return on sales

8 Factors Affecting Selling Price
Costs Fixed Variable Supply and Demand Economic Conditions Competition Pure Competition Monopolistic Competition Oligopoly Monopoly

9 Factors Affecting Selling Price(cont.)
Government Regulation Price fixing Price discrimination Price advertising Unit pricing Distribution Channels Company Objectives and Strategies Product mix Product life cycle Target market

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