Pricing

Revision notes on pricing for GCSE Business Studies.

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  • Created by: t
  • Created on: 18-04-08 11:16
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Pricing is part of an overall marketing strategy
used to persuade customers to buy a product
cost-plus pricing
a percentage mark-up is added to the total unit cost
of production to give a business its profit margin this
takes no account of variations
competitive pricing
a firm sets it price close to its rivals so competition
effectively focuses on non-price features such as
quality of service
loss-leader
prices are set at or below cost in order to penetrate a
new market often used by supermarket this attracts
customers to the cheep products as they will normally
but other products when they are there
skimming/creaming the market

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Highlights a products uniqueness e.g. new hi-tech
equipment is often given a high price as some people
will buy it as a luxury this enables the development
costs to be recovered later the price can be dropped
to attract a larger market
Price discrimination
This is where you can charge some people more than
others for the same thing airlines often use this e.g.…read more

Comments

davidsalter

A brief summary of the various pricing strategies that could be adopted. Useful for the price part of the marketing mix.

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