Setting Price

1
Setting Price

• Factors Affecting Price
• Demand high, supply low? (higher price)
• How much profit to make handling product
  worthwhile? (higher price)
• Competition (may lower prices)
• Costs Expenses (must make a profit)

2
Setting Price

• Pricing Goals/Strategies
• What will help you achieve your goals?
• Cost-based pricing - figure cost to make or buy,
  the cost of doing business projected profit
• Demand-based pricing - find out what customers
  are willing to pay
• Competition-based pricing - determine what
  competitors are charging and align below, at that
  level, or above

3
Setting Price

• Pricing decisions
• Consider your target market
• What motivates them to buy? Are they price
  conscious? Status conscious?
• How much will they buy at different prices?
• Will I offer discounts?
• Will I offer credit? Will I finance this myself?
• What will my pricing policy be?