Pricing
Pricing is the act of establishing a value for a product or service. In other words, pricing occurs when a business decides how much a customer must pay for a product or service [The Balance].
Pricing is a process of fixing the value that a manufacturer will receive in exchanging services and goods. The pricing method is exercised to adjust the cost of the producer’s offerings suitable to both the manufacturer and the customer. The pricing depends on the company’s average prices and the buyer’s perceived value of an item compared to a competitor's products.
Every businessperson starts a business with the motive and intention of earning profits. This ambition can be acquired by the pricing method of a firm. While fixing the cost of a product and services, the following point should be considered:
– The identity of the goods and services
– The cost of similar goods and services in the market
– The target audience for whom the goods and services are produced
– The total cost of production (raw material, labor cost, machinery cost, transit, inventory cost, etc).
– External elements like government rules and regulations, policies, economy, etc. [Byju’s].
What Is Pricing? The Balance. Retrieved from: https://www.thebalancemoney.com/what-is-pricing-393477
What Is Pricing? Byju’s. Retrieved from: https://byjus.com/commerce/what-is-pricing/