The Impact of Pricing Policy Strategy on Sales
Every activity that occurs in a company or business cannot be separated from decisions that have been previously considered. One of the important decisions made by a company is related to pricing.
There are several mechanisms for determining prices so that the expected targets can be achieved. Among others are:
- Cost-based pricing policy, by adding a profit percentage to the overall cost of a good or service.
- Value-based pricing policy, a combination of customer perceptions of the value of the goods offered and production costs.
- Demand-based pricing policy, based on consumer behavior and also the value attached to the product or service.
- Competition-based pricing policy, by first analyzing the costs, strategies and quality of competitors' production. Then, the company finds out the appropriate value for the goods or services produced.
Whatever mechanism you and your company choose for business, it certainly has the same goal. This goal is so that you can provide reasonable prices for consumers and still provide profits for the company.
The Influence of the Pricing Process in Business
An underdeveloped pricing process can have a negative impact on your business revenue. Therefore, determining prices in a business needs to be thought carefully. For companies, pricing policy will affect several aspects, including:
Prices will affect company profits
Every business certainly hopes to make a profit. Whatever the company's reasons for setting prices, profit is what can make your company survive. Therefore, several companies consider that getting maximum profits will be very important for the company's sustainability in the future.
Price is a manifestation of product value
Consumers often have the assumption that a cheap product price means it also has low production costs. Thus, consumers will tend to question the quality of the products provided. On the other hand, high product prices will be associated with high production costs and guaranteed quality.
The right price will attract customer interest
Each company has the power to determine the price of the products offered. Prices that are too low make consumers think that the product is of poor quality. Besides that, prices that are too high are certainly not affordable for consumers in general. Thus, providing the right and reasonable prices in the eyes of customers will attract their interest in buying products from your company.
Price is the company's capital to be able to compete and survive
It is normal for consumers to always compare the prices of products issued by each company. If the company succeeds in setting the right price, of course consumers will always choose the products produced by your company.
These loyal customers can help your company continue to survive or even get more capital to innovate. For this reason, it is important for companies to continue to provide prices that can compete with competitors.
These are some of the benefits you can get through a pricing policy strategy for sales activities in the company. Whatever pricing mechanism your company will adopt, do it carefully so that the strategy can bring benefits to the company.
When carrying out the pricing process that occurs in a business, it is important to be able to understand the basic principles that are the basis for determining price changes for a product. To maintain stable business continuity, the Marketing Pricing Strategy program is designed to direct company executives to create comprehensive coordination between finance, marketing, sales and production.
