ARBUS302 Lecture Notes - Lecture 9: Value-Based Pricing, Unit Price, Barter
16 Dec 2019
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The practice of exchanging goods and services for other goods and services rather than for money is called barter. Value pricing refers to increasing product or service benefits while maintaining or decreasing price. Profit = total revenue total cost = tr - tc. Profit = (unit price x quantity sold) total cost. Pricing constraints are the factors that limit the latitude of prices that a firm may set. We will consider the following factors as the main pricing constraints: demand for the product class, product, and brand, demand plays a major role in pricing. Demand represents the willingness to buy at a given price. The goal is to take advantage of price insensitive buyers for a new product. Pricing objectives are the expectations that specify the role of price in an organization"s marketing plan. Businesses might choose to follow one of many pricing objectives including: profit, sales revenue, market share, unit volume, survival, and social responsibility.
