This is the amount of money charged for a good or service.This is the sum of value consumers exchange for the benefit of having or using a good or service. This is the market value of a product as it is offered in market.
FACTORS AFFECTING PRICING DECISIONS/FACTORS TO CONSIDER WHEN PRICING.
- Marketing objectives-a marketer must consider the marketing mix in terms of product design,distribution and promotion in order to form a consistent and effective marketing programs
- Cost-consider the cost of production,cost of distribution and marketing expenses.
- Profit maximization-the management must consider profits expected before setting the final price.
- Organizational considerations-prices must always be set by management rather than by the marketing department/sales
- Market and demand for the product-a markter must understand the relationship between price and demand for the product(factors affecting demand).
- Environmental elements-prices must take into consideration the existing competitors prices.
- Prices of substitute goods.
- Intermediaries demands
- Suppliers-if an organization suppliers notice that prices of an organization products are rising,they may seek a rise in price of their supplies(inputs) to that organization
- Inflationary conditions prevailing in the country
- income effects of the consumers.