Ch9 Flashcards
Customer value bas d pricing
Setting price based on customer perceived value rather than expenses
Good value pricing
Offering just the right combination of quality good service at a fair price
Value added pricing
Attaching value added features and services to differentiate a company’s offers and charging higher prices
Cost based pricing
Setting prices based on the cost of producing distributing plus a fair rate of return
Fixed cost
Costs that do not vary with production or sale level
Variable costs
Costs that vary with the level of production
Total cost
The sum of the fixed and variable costs for any given level of production
Cost plus pricing
Adding a standard markup to the cost of the product
Break even pricing
Setting price to break even on the costs of making and marketing a product or setting price to make a target return
Competition based pricing
Price based on competitors prices
Target costing
Pricing that starts with an ideal selling price then targets costs that will ensure that the price is met
Product line pricing
Setting the prices of a product line
Optional product pricing
The pricing of accessory items along with main product
Navigation system in car
Captive product pricing
Setting price for products that must be used along with main product
Razor and blades
By product pricing
Setting price for by products in order to make the main products price more competitive
