1. Profitable Event Registration Pricing Via ODPR Method
Dr. Godwin-Charles Ogbeide, PhD, MBA
Associate Professor of Strategy & Hospitality
IUPUI, Department of Tourism, Convention & Event Management

2. Pricing in the Public Sector
Prices of public sector goods and services will depend on the market situation and the objectives of each organization. These might be:
Profit maximization: Pricing set to produce a total revenue which will maximize profit
Break-even pricing: Pricing set to produce a total revenue which covers total costs
Social cost/benefit pricing: Pricing set on the basis of the good things that people get from owning and using the goods or services. It could be lower than market price (partial subsidy) or at zero price (total subsidy)

3. Ogbeide’s Desired Profit Rate (ODPR)
The ODPR method can be used by many business organizations to decide on the price (rate) of their product/service to be sold, based on the organizations’ desired profit rate
This method is a little similar to Hubbart formula, but unlike Hubbart formula it could be used to establish the rate of individual product or service such as the price of a cup of coffee, registration fee, or the average rate of collective products such as the average daily rate of hotel rooms

4. Ogbeide’s Desired Profit Rate (ODPR)
Another contrast between the ODPR method and the Hubbart formula is that the Hubbart formula is based on return on investment, while ODPR method is based on the desired profit rate
In order to use ODPR method of pricing, the following variables must be known or predicted:
Total fixed expenses
Estimated operational cost
Estimated demand (i.e., # of products or # of attendees)
Desired profit rate

5. ODPR Steps There are three main step for using ODPR
First, compute the desired profit from a given desired profit rate
Second, compute the desired revenue
Third, compute the registration fee (or the price/unit)

6. ODPR Formulae & Steps Step 1 Formula: Step 2 Formula: Step 3 Formula:
Desired Profit = (total expenses + total operational cost) X 20%
1-20%
Step 2 Formula:
Desired Revenue = total expenses + total operational cost + desired profit
Step 3 Formula:
Price per unit = desire revenue ÷ estimated demand

7. Ogbeide’s Desired Profit Rate (ODPR)
To illustrate the use of ODPR method, assume an event manager hope for a 20 percent profit before tax in an event she is planning. If the following situation applies to the event, the potential minimum fee for the event can be computed:
Fixed expenses = $525,000
Estimated operational cost based on previous year’s = $1,500,000
Estimated attendees = 10,125

8. ODPR Formulae & Steps Step 1 Formula:
Desired Profit = (total expenses + total operational cost) X 20%
1-20%
= ($525,000 + $1,500,000) X 20% = ($525,000 + $1,500,000) X 0.20
80%
= 2,025,000 X .20
.80
Desired profit = $506,250

9. ODPR Formulae & Steps Step 2 Formula: Step 3 Formula:
Desired Revenue = total expenses + total operational cost + desired profit
Desired Revenue = $1,500,000 + $525,000 + $506,250 = $2,531,250
Step 3 Formula:
Price/unit = desire revenue ÷ estimated demand
Price/unit = $2,531,250 ÷ 10,125
Price/unit = $250.00
Hence, the minimum fee for the eevent = $250.00

10. Profitable Event Registration Pricing Via ODPR Method
Dr. Godwin-Charles Ogbeide, PhD, MBA
Associate Professor of Strategy & Hospitality
IUPUI, Department of Tourism, Convention & Event Management
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