pricing Flashcards
(7 cards)
1
Q
business objectives that would influence pricing
A
financial -
maximise profit
improve cash flow
marketing
build a brand
increase sales
2
Q
main factors that would influence pricing
A
competitors
market objectives
costs
3
Q
adv of using cost to influence pricing
A
- easy to calc
- price increases = justified when costs rise
- managers confident that each product is being sold at a profit
3
Q
disadvantages of using cost to influence pricing
A
- sales lost if price is set above what customers are willing to pay
- doesn’t take into account competition
4
Q
price skimming
A
- high price to maximise profit
5
Q
penetration pricing
A
opposite of price skimming
- offer product at low price
- build customer loyalty
6
Q
dynamic pricing
A
- business set flexible prices for products based on current market demands
