Pricing is the process of translating the value of product or service into quantitative terms and adding to it the revenue a firm wants to earn after considering all the expenses occurred both in monetary and non monetary forms. Price is the outcome of pricing which is kept unchanged for a certain period of time.
Pricing considers all the factors like cost of procurement of raw materials, cost of production, cost of transportation, distribution, marketing, packaging, and sales promotion, competition, purchasing power of target market, government policies, etc.
Pricing includes setting objectives, identifying the factors governing price, formulating price policies, formulating strategies for setting prices, implementing them and controlling them.
Some of the objectives of pricing are as follow:
1. Return on investment: Main objective of pricing is that the price decided for a product should be able to bring satisfactory return on investment so that the firm gets motivation and viability to carry on the production of a product.
2. Profit maximisation: When product gets acceptance in the market firms try to maximise their profits by way of pricing by keeping the price of a product high.
3. Price stability: When the price of a product is volatile its consumers are confused therefore companies try to keep the price stable to win the confidence of consumers.
4. Under the reach of target market: This is also one of the basic objective of pricing where price of the product is kept at the level where the target market can easily afford it.
5. Social welfare: Sometimes social welfare is the objective when a company keeps the price of a product at minimum possible level so that they can serve the beneficiary. It happens mostly with generic and basic products run by some NGO or non-profit organisation working with social welfare objective.
6. Complying Government policies: In the process of pricing a product government policies for maximum price including taxes have to be kept in mind. Price of the product needs to be in compliance with the law of the land.
7. Beating competition: When a firm runs a product with the objective to beat the competition it may follow low price policy to penetrate the market and increase its market share.
8. In line with firm's objectives: In whatever stage of product of a firm be in product life cycle its pricing is directly influenced with that. It means pricing objectives are directly proportional to a firm's objectives.
9. Bringing satisfactory profits to channel partners: After a product is manufactured it reaches to its customers via different channels who are called traders or intermediaries having monetary interests. Pricing has to cater their interest and profits to sell the products to final customers.
10. Consumers' satisfaction: A product is made for the ultimate customer who uses it. Pricing of a product should be such that a consumer feels satisfaction while buying and using the product. It should not be too high that the customer feels it does not worth it and nor too low that customer feels it is of sub quality.
Pricing considers all the factors like cost of procurement of raw materials, cost of production, cost of transportation, distribution, marketing, packaging, and sales promotion, competition, purchasing power of target market, government policies, etc.
Pricing includes setting objectives, identifying the factors governing price, formulating price policies, formulating strategies for setting prices, implementing them and controlling them.
Some of the objectives of pricing are as follow:
1. Return on investment: Main objective of pricing is that the price decided for a product should be able to bring satisfactory return on investment so that the firm gets motivation and viability to carry on the production of a product.
2. Profit maximisation: When product gets acceptance in the market firms try to maximise their profits by way of pricing by keeping the price of a product high.
3. Price stability: When the price of a product is volatile its consumers are confused therefore companies try to keep the price stable to win the confidence of consumers.
4. Under the reach of target market: This is also one of the basic objective of pricing where price of the product is kept at the level where the target market can easily afford it.
5. Social welfare: Sometimes social welfare is the objective when a company keeps the price of a product at minimum possible level so that they can serve the beneficiary. It happens mostly with generic and basic products run by some NGO or non-profit organisation working with social welfare objective.
6. Complying Government policies: In the process of pricing a product government policies for maximum price including taxes have to be kept in mind. Price of the product needs to be in compliance with the law of the land.
7. Beating competition: When a firm runs a product with the objective to beat the competition it may follow low price policy to penetrate the market and increase its market share.
8. In line with firm's objectives: In whatever stage of product of a firm be in product life cycle its pricing is directly influenced with that. It means pricing objectives are directly proportional to a firm's objectives.
9. Bringing satisfactory profits to channel partners: After a product is manufactured it reaches to its customers via different channels who are called traders or intermediaries having monetary interests. Pricing has to cater their interest and profits to sell the products to final customers.
10. Consumers' satisfaction: A product is made for the ultimate customer who uses it. Pricing of a product should be such that a consumer feels satisfaction while buying and using the product. It should not be too high that the customer feels it does not worth it and nor too low that customer feels it is of sub quality.
ur Vision is to make our institution a symbol of excellence in the arena of coaching and to cope with everything required for boosting and enlightening the future of students in order to attain academic excellence and for successfully preparing them to cope with challenges. We provide coaching for students who wish to achieve high performance in UGC NET. best ugc net coaching in chandigarh
ReplyDeleteThanks for providing such relevant and wonderful article about pricing objective, this will not only help me in getting better UGC NET Results but also in my regular studies.
ReplyDeleteThe requested information is good enough. And then by reading this feel good, were constantly writing and Share Information.
ReplyDeletedavv cet coaching in Indore
Thanks for the useful tips regarding UGC NET. We'll sure share some of your points in our UGC NET COACHING
ReplyDeleteNice Blog. Thanks for sharing with us. Such amazing information.
ReplyDeleteBest Engineering College in Dehradun
Best B.Sc. Agriculture College in Dehradun
Best Private Polytechnic College in Dehradun
Best BBA College in Dehradun
Best MBA College in Dehradun
Top 10 BBA Colleges in Dehradun
Top 5 B.Tech Colleges In Dehradun
Which are the best MBA colleges in Dehradun?
Hi, Nice Blog
ReplyDeleteUGC NET Coaching in Chandigarh from Gurukul Career Group, is considered to be the Best UGC NET Coaching in Chandigarh because of its erudite faculty who have got years of experience.
Hi Nice Blog,
ReplyDeleteUGC NET Coaching In Shimla – We are providing UGC NET Online Coaching, UGC NET Coaching Center In Shimla, UGC NET Exam Coaching center in Shimla , UGC NET Preparation Course in Shimla by well experienced faculty at minimum cost & low fees to all students or jobseekers.