The basis for determining the selling price. In general, there are two main factors that need to be considered in determining the price, namely the company‘s internal factors and external environmental factors. 1. Company Internal Factors a. Marketing Purpose The company’s main determining factor in pricing is the company’s marketing objectives. These goals can be […]
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Selling price setting method. Broadly speaking, pricing methods can be grouped into four main categories, namely demand-based, cost-based, profit-based, and competition-based pricing methods. 1. Demand-Based Pricing Method Is a method that emphasizes the factors that influence customer tastes and preferences rather than factors such as costs, profits, and competition. Customer requests are based on various
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Special Adjustments to Prices. Special adjustments to list prices consist of discounts, allowances and geographical adjustments. 1. Discounts Discount is a discount given by the seller to the buyer in appreciation of certain activities from the buyer that are pleasing to the seller. Usually this price discount is realized in cash or in kind and
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The purpose of setting the selling price. In setting price objectives, producers must link it with the overall company strategy. As for the general purpose of pricing is. 1. Maximizing sales and market penetration To be able to attract the attention of consumers who are the target market, a company should set the lowest possible
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Effect of price on consumer preferences. More or less the information obtained by consumers affects the occurrence of a transaction because consumers have information or references to compare the price of one product with other products and with alternative products. Consumers in their efforts to make decisions on purchasing a product are influenced by and
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The role of prices in the economy. In the business world, prices have many names, for example, in the trading world, a product is called price, in the banking world, it is called interest, or in the accounting services business, consultants are called fees, taxi and telephone transportation costs are called tariffs, while in the
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The purpose of pricing according to experts. One of the most difficult decisions a company faces is to set a price. Although the pricing method used is the same for every company, which is based on cost, competition, demand, and profit. However, the optimal combination of these factors differs according to the nature of the
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Perception of price and product quality. In assessing the quality of a product, it really depends on the information attached to the product and also depends on how much the information is understood by each individual. This information can be both intrinsic and extrinsic (Schiffman & Kanuk, 2000). Intrinsic information is information that comes from
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