One of the most important parts of marketing mix is price, It is the mix which makes the turnover of the organization. The rests of the mix are one type of variable cost of the organization but the price need to support the organization. The pricing is the difficult and affect the demand and supply. Pricing is responsible to make loss or profit on in the organization by making it too much or too low. Here our companies’ product the LSABK is #329, which is a wrist watch and it is based on factors following: 1. Fixed cost and variable cost: The fixed cost is companies cost which stays almost same on low and normal production Ex: Buildings, furniture, Rent etc. 2. Competition: It is the fact which depends on other companies who makes same types of products Ex: Rolex, Rado, Titan, Police, D&G etc. 3. Company objectives: It is things which called companies goal or mission Ex: making profit and serving the customers. 4. Target group: Here we targeting the people who are time conscious, smart, middle income holder, stylist etc.
Basically a company takes a strategy from some strategies and sometimes collaborate some of them , we also used from them , they are followings:
*Penetration Pricing: On this style a company sets a low price to sales increase as a market share and when market shares captured then company can increase their price. For example we can see the TV satellite companies, they mostly use this strategy. On our company we didn’t used this.
*Price skimming : In this style Company initially sets a high price and then reduce it slowly . In this strategy company skim the profit first from the market and layer by layer. For example we can look at the games companies and music companies , the mostly follow this style. We think this strategy we can implement on our company.
*Competition Pricing: In here organization sets price in comparison with other competitors. It is happened on very competitive market areas, here an organization has basically 3 choice like 1.Lower price, 2.Same price, 3. Higher price. As an example we see this on most known and regular used product companies. We always kept this on our mind.
*Product Line pricing: This strategy means set price of different products in same product range at different price. Ex: We mostly see this type of pricing strategy on some special sectors like one movie company print movies in different category: DVD, VCD, Blue Ray ect. Basically we are not using this on our company.
*Bundle Pricing: This is the strategy where company bundle a group of products in a reduced price. Or it can be by following BOGOF formula which means by one get one free. Which is most common strategy now a day in every countries, even in UK also. For example we see the cosmetics companies follow it very frequently. We can use this style on our organization.
*Psychological pricing: The organization here considers the psychology of the price and the price positioning within the market place. Here the organization set price