Importance of Costs in Pricing Strategy

Importance of Costs in Pricing Strategy Price of a product is a major element of the marketing mix. Pricing is one of the most important strategic issue because it is related to the product positioning. The price goes in hand with the other marketing mix elements such as product promotion, channel decisions and its features. For a developing the pricing of a new product, there can be a general sequence of steps that can be followed by the organisation which may vary from other organisations. The main area of focus will however be same for all the organisations. The different steps can be as follows. Develop marketing strategy perform marketing analysis, segmentation, targeting, and positioning. Make marketing mix decisions define the product, distribution, and promotional tactics. Estimate the demand curve understand how quantity demanded varies with price. Calculate cost include fixed and variable costs associated with the product. Understand environmental factors evaluate likely competitor actions, understand legal constraints, etc. Set pricing objectives for example, profit maximization, revenue maximization, or price stabilization. Determine pricing using information collected in the above steps, select a pricing method, develop the pricing structure, and define discounts. The various pricing strategies for products include, competition based pricing, cost-plus pricing, creaming or skimming, limit pricing, loss leader, market oriented pricing, penetration pricing, price discrimination, premium pricing, predatory pricing, contribution margin based pricing, psychological pricing, dynamic pricing, price leadership, target pricing, absorption pricing, high-low pricing, premium decoy pricing, marginal cost pricing, value based pricing. For each and every pricing strategies has its own reasons and market reach. At the end of the assignment, we can observe the various methodologies and techniques an organisation adopts in managing the finances using the pricing centric point of view. The factors that influence how a consumer perceives a given price and how price-sensitive a consumer is likely to be with respect to different purchase decisions[1] Reference Price Effect Buyers price sensitivity for a given product increases the higher the products price relative to perceived alternatives. Perceived alternatives can vary by buyer segment, by occasion, and other factors. Difficult Comparison Effect Buyers are less sensitive to the price of a known / more reputable product when they have difficulty comparing it to potential alternatives. Switching Costs Effect The higher the product-specific investment a buyer must make to switch suppliers, the less price sensitive that buyer is when choosing between alternatives. Price-Quality Effect Buyers are less sensitive to price the more that higher prices signal higher quality. Products for which this effect is particularly relevant include: image products, exclusive products, and products with minimal cues for quality. Expenditure Effect Buyers are more price sensitive when the expense accounts for a large percentage of buyers available income or budget. End-Benefit Effect The effect refers to the relationship a given purchase has to a larger overall benefit, and is divided into two parts: Derived demand: The more sensitive buyers are to the price of the end benefit, the more sensitive they will be to the prices of those products that contribute to that benefit. Price proportion cost: The price proportion cost refers to the percent of the total cost of the end benefit accounted for by a given component that helps to produce the end benefit (e.g., think CPU and PCs). The smaller the given components share of the total cost of the end benefit, the less sensitive buyers will be to the components price. Shared-cost Effect The smaller the portion of the purchase price buyers must pay for themselves, the less price sensitive they will be. Fairness Effect Buyers are more sensitive to the price of a product when the price is outside the range they perceive as fair or reasonable given the purchase context. The Framing Effect Buyers are more price sensitive when they perceive the price as a loss rather than a forgone gain, and they have greater price sensitivity when the price is paid separately rather than as part of a bundle. The Activity-based costing (ABC) The Activity-based costing (ABC) is a type costing model that identifies activities in an organization which assigns the cost of each activity resource to all products and services according to the actual consumption by each. The main concept of this model is to assign more of the indirect costs into direct costs. Indirect costs are costs that are not directly accountable to a cost object, such as a particular function or product. Indirect costs may be either fixed or variable. Indirect costs include taxes, administration, personnel and security costs, and are also known as overhead, which is nothing but the cost incurred for operating any kind of business. So in this costing model an organisation can precisely estimate the cost of individual products and services so they can identify and eliminate those that are unprofitable and lower the prices of those that are overpriced. In a business organization, the ABC methodology assigns an organizations resource costs through activities to the products and services provided to its customers. It is generally used as a tool for understanding product and customer cost and profitability. As such, ABC has predominantly been used to support strategic decisions such as pricing, outsourcing, identification and measurement of process improvement initiatives. The different uses of the ABC model is as follows It helps to identify inefficient products, departments and activities It helps to allocate more resources on profitable products, departments and activities It helps to control the costs at an individual level and on a departmental level It helps to find unnecessary costs It helps fixing the price of a product or service scientifically Yes, the ABC model does has its limitations. Even in activity-based costing, some overhead costs are difficult to assign to products and customers, such as the chief executives salary. These costs are termed business sustaining and are not assigned to products and customers because there is no meaningful method. This lump of unallocated overhead costs must nevertheless be met by contributions from each of the products, but it is not as large as the overhead costs before ABC is employed. Although some may argue that costs untraceable to activities should be arbitrarily allocated to products, it is important to realize that the only purpose of ABC is to provide information to management. Therefore, there is no reason to assign any cost in an arbitrary manner. Be able to apply forecasting techniques to obtain information for decision making Apply forecasting techniques to make cost and revenue decisions in an organisation Assess the sources of funds available to an organisation for a specific project Be able to participate in the budgetary process of an organisation Select appropriate budgetary targets for an organisation Participate in the creation of a master budget for an organisation Compare actual expenditure and income to the master budget of an organisation Evaluate budgetary monitoring processes in an organisation Be able to recommend cost reduction and management processes for an organisation Recommend processes that could manage cost reduction in an organisation Evaluate the potential for the use of activity-based costing Be able to use financial appraisal techniques to make strategic investment decisions for an organisation Apply financial appraisal methods to analyse competing investment projects in the public and private sector Make an justified strategic investment decision for an organisation using relevant financial information Report on the appropriateness of a strategic investment decision using information from a post-audit appraisal Be able to interpret financial statements for planning and decision making Analyse financial statements to assess the financial viability of an organisation Apply financial ratios to improve the quality of financial information in an organisations financial statements Make recommendations on the strategic portfolio of an organisation based on its financial information

charles lindbergh :: essays research papers

Charles Lindbergh Born February 4, 1902, in Detroit, Michigan, Charles Lindbergh grew up on a farm near Little Falls, Minnesota the son of a lawyer/U.S. Congressman. Charles showed exceptional mechanical ability, even as a child, and was encouraged to attend college and make the most of his talent. After graduating high school, Charles stayed on to work at the family farm for two years before enrolling in the University of Wisconsin-Madison, where he would study Engineering. Full of a passion for airplanes and the newly expanding field of aviation, Charles Lindbergh left college after two years to attend the Lincoln Flight School in Nebraska. when graduated, Lindbergh would spend the next few years performing daredevil stunts and county fairs and carnivals. Charles enlisted in the United States Army in 1924, to be trained as an Army Air Service Reserve pilot. Graduating the following year, Charles Lindbergh was named the best pilot in his class. In 1919, Raymond Orteig, a New York City hotel owner, offered $25,000 to the first aviator who could fly nonstop from New York to Paris. Several pilots tried and failed. But on May 20, 1927,with The Spirit of St. Louis, Lindbergh took off from Roosevelt Field in New York, and became the first pilot in the world to make a solo, nonstop flight across the Atlantic Ocean. Lindbergh flew some 3600 miles in just over 33-hours and proudly collected his $25,000 reward in front of cheering fans in Paris. The press nicknamed Mr. Lindbergh "Lucky Lindy" and the "Lone Eagle" and he instantly became a hero. With success and fans everywhere, twenty-five year old Lindbergh flew to various Latin-American countries in 1927, at the request of the U.S. government. While working in Mexico, Lindbergh met Anne Spencer Morrow, the daughter of the American Ambassador. They would marry in 1929, and travel the world together, charting new routes for various airlines that are still used by commercial jetliners today. Ms. Lindbergh herself would go on to become a famous poet and writer. Much to world's surprise, twenty month old Charles Augustus Lindbergh, Jr. was kidnapped from his home nursery in New Jersey in 1932, making headlines across the country. Leaving only a ransom note demanding $50,000 in the window and a homemade ladder leaning against the Lindbergh home, it seemed someone had kidnapped the baby of the most famous man in the world and not left any evidence behind.

Lead Change Ba

lead Leading Change – British Airways case: references MBA 2013 Core Grugulis, I. , Wilkinson, A. (2002) Managing Culture at British Airways: Hype, Hope and Reality. Long Range Planning, 35, 2, 179-194. Kotter, J. (2007) `Leading Change: Why Transformation Efforts Fail’, Harvard Business Review, January 2007, pp. 96 – 103 Recommended Beer, M. & Nohria, N. 2000, â€Å"Cracking the Code of Change†, Harvard Business Review, vol. May-June, pp. 133-141. Vermeulen, F. , Puranam, P. & Gulati, R. 2010, â€Å"Change for Change's Sake†, Harvard business review, vol. 8, no. 6, pp. 70-76 Supplementary Burnes, B. 2004, Managing Change, Fourth edn, Financial Times/Prentice Hall, London. Grey, C. 2003, â€Å"The Fetish of Change†, TAMARA: Journal of Critical Postmodern Organization Science, vol. 2, no. 2, pp. 1-19. Jick, T. D. & Peiperl,M. A. (2003) (2nd edn) `Managing Change: cases and concepts’, Boston: McGraw-Hill (pp 26-44) Kegan, R. & Lahey, L. L. 2001, â€Å"The real reason people won't change†, Harvard Business Review no. November, pp. 84-92. Kotter, J. P. (1996) Leading change, Boston, Mass. Harvard Business School Press (658. 406) 4 copies in UniS library, and available as an e-book Morgan, G. 2006, Images of Organization, 4th edn, Sage, London. Robbins, H. and Finley, M. (1997) Why Change Doesn’t Work, London: Orion Business Books (out of print, sections 1,2, and 3 are available at http://mfinley. com/bizbooks/list-changebook. htm) Watzlawick, P. , Weakland, J. , & Fisch, R. 1974, Change: principles of problem formation and problem resolution W. W. Norton & Co. , New York.

Honor And Glory Greek Character And Way Of Life

Honor and glory are central to Greek character and way of life. Heroes are the essence of the nation and society that they come from. Because of this, they lead their lives according to this code of honor and glory. This need for honor erupts in the Trojan war and shapes the outcomes of every decision made in this war. Every Greek warrior strives for the legacy of their fame in battle to resound, even after their demise. The concepts of honor guide the outcomes of the illustrations in this epic. The honor of the individual warrior, kin, and nation effect the decisions of every individual within this epic. The glorification of war is a central theme within the epic. An important aspect of this glorification is given by Homer’s account of how honor is given to the individual. Homer describes gaining honor as an individual in two related ways: through winning in battle and through death in battle. â€Å"out on the battle lines where men win glory (Homer, 7.131)†. Both pro cesses involve the courage in battle and the honor gained by being courageous. The decisions of the characters are affected by this need for glorification in battle. The first way to gain honor and glory through battle is by winning in battle. Achilles is revered throughout the Achaean camp as â€Å"the sift runner (Homer, 1.142)† because he has gained great glory by winning battles. Achilles is the main character to this epic, and the background information about his prowess attests to the notion that Achilles isShow MoreRelatedHonor And Glory By Homer1574 Words   |  7 PagesOctober 5, 2015 Honor and Glory The idea of obtaining honor and glory are what Greek characters dedicate their lives to. The Greeks lived by a heroic code, which shaped their society. Being remembered, as a great warrior, is one of the highest honors a Greek soldier can obtain. Honor and glory are the cause of the Trojan War, which takes the lives of many men. Honor and Glory are what define the hero in the epic poem, The Iliad, written by Homer. Throughout the Iliad, honor and glory is the motivationRead MoreHonor, Glory, Legacy Of The Iliad1735 Words   |  7 PagesHonor, Glory, Legacy How important is it to be honored? To gain glory in this life? To secure a lasting legacy? To the Greeks and Trojans in Homer’s famous epic, The Iliad, these were the most important things in life. The Greeks of Homer’s time believed that personal honor and glory was just that, personal. Honor and glory belonged to the individual who was skilled and accomplished enough to obtain it for himself. This honor and glory was held in the highest regard, and the worldview that honorRead MoreExamples Of Glory And Glory In The Iliad1054 Words   |  5 Pages4, 2017 Glory and Honor in Homer’s Iliad Thesis: Great honor comes with great responsibility. Glory should come with wisdom. Homer presents this idea in various ways. This theme is woven through The Iliad showing the foundation of dignified heroes and self-glorification. Introduction: I. Honor and glory A. Heroic actions B. God-like glory II. Social Status A. Greek Society B. Recognition and influences III. Mortality and immortality A. Glory after death B. Ongoing honor ConclusionRead MoreThe Iliad : Greeks And Their Love For War1568 Words   |  7 PagesJosef Affourtit Affourtit.2 February 10th, 2017 CLAS1101 The Iliad: Greeks and Their Love for ‘War’ It has long been a popular scholarly opinion that the Greeks in the Iliad were lovers of war and violence. The Greeks were most definitely primal beasts, and blood shedders, a fact made abundantly clear in the Iliad. However, I think that the Greeks were not lovers of war, furthermore I think this interpretation is shortsighted. The amount of violence in the Iliad seems to be evidence for their loveRead MoreEssay on The Iliad of Homer and Greek Heroes1495 Words   |  6 Pagesis an epic tale of war and hero’s within the Greek way of life. A predominant and consistent theme of honor and glory reside throughout the poem. The motivation for any Homeric Greek is glory, or â€Å"Kleos†, that is to be honored and respected among their people. Emphasis is put on living by the heroic code. Honor is essential to the Greeks and life would not be worth living without it. When a warrior or hero is advised to avoid risking their life in battle it almost drives them even furtherRead MoreThe Iliad and Greek Heroes1500 Words   |  6 Pagesepic tale of war and heros within the Greek way of life. A predominant and consistent theme of honor and glory reside throughout the poem. The motivation for any Homeric Greek is glory, or Kleos, that is to be honored and respected among their people. Emphasis is put on living by the heroic code. Honor is essential to the Greeks and life would not be worth living without it. When a warrior or hero is advised to avoid risking their life in battle it almost drives them even furtherRead MoreWilliam Shakespeare s The Trojan War 1318 Words   |  6 Pagesexplore the interpretation of honor as something extrinsic without associating it with intrinsic moral values. In the seventeenth century, â€Å"honour† was used in four different ways: fame, renown, glory; credit, good name, reputation; noble rank, position of dignity, title of renown; source of distinction. Fame and reputation are the most common uses of honor throughout the play. Therefore, to avoid confusion and redundancy, fame and reputation will be synonymous to honor for this analysis. CuriouslyRead MoreEssay about Heroic Code in the Iliad and the Odyssey979 Words   |  4 Pageshas risked or sacrificed his life. In the Iliad and the Odyssey, the code which administers the conduct of the Homeric heroes is a straightforward idea. The aim of every hero is to achieve honor. Throughout the Iliad and the Odyss ey, different characters take on the role of a hero. Honor is essential to the Homeric heroes, so much that life would be meaningless without it. Thus, honor is more important than life itself. Throughout the Iliad, heroic characters make decisions based on a specificRead MoreTheme Of Gender In The Epic Of Gilgamesh And The Mahabharata1051 Words   |  5 Pagesturn shows that her sexual prowess can be transformative, for he had gained reason and expanded his understanding (104). Despite Ekidus upbringing and treatment as an animal, Shamhat alone, humanized him, which allowed this progression in his character. To be accepted and revered, rather than seen as a problem and feared. If it wasnt for Shamhat, Ekidu would never have been placed on the path that he was meant for and Gilgamesh would still be alone and not kept accountable. In this epic, womenRead MoreAnalysis Of The Book The Iliad 965 Words   |  4 Pagescinematic look not only on Achilles, but on other scenes and situations, providing missing character depth, and asking questions The Iliad might not have. The perspective we got from Achilles in The Iliad is one of a great warrior, but in his rage abandons his comrades because his pride got hurt. His actions make him selfish and petty to the readers, but on pages 9-15 in War Music we get more character depth and perspective. In those few pages we see a man, one of history’s greatest heroes acting