Good-value pricing combination of quality to fair price.

Value-added pricing: to differentiate offers, support higher prices, and build pricing power

Producing, distributing, and selling the product plus return for effort and risk + adds a standard markup

Fixed costs = const, not vary with production or sales level Ex: Rent, Utilities, Interest, Executive salaries

Variable costs: vary with the level of production Ex: Packaging, Raw materials

Total costs = FC + VC

Average cost = TC/ output (cost associated with a given level of output)

Experience or learning curve: when the average cost falls as production increases

Markup Price= Unit Cost/ ( 1- Desired Return on Sales )

Break- even volume= Fixed cost/( Price - Variable cost )

Marketing strategy, objectives, and marketing mix

Organizational considerations

The market and demand

Types of markets

Analyzing the price-demand relationship

Competitors’ strategies and prices

Other environmental factors

Survival

Profit maximization

Market share leadership

Customer retention and relationship building

Attracting new customers

Opposing competitive threats

Increasing customer excitement

many buyers and sellers

trading uniform commodities

effect on market price

trade over a range of prices

differentiated offers

few sellers ( hard to enter )

highly sensitive

only one seller

non-regulated monopoly, free to set a market price

Unique product

Quality

Prestige

Substitute products

Cost relative to income

Comparison of offering customer value

Strength of competitors

Competition pricing strategies

Customer price sensitivity