Pricing policy is the principles and methods for determining prices for goods and services.
The pricing policy of the firm is formed within the framework of the overall strategy of the firm and includes pricing strategy and pricing tactics. Pricing strategy involves positioning the proposed product on the market. Within the framework of the pricing strategy, the methods used for determining (setting) prices, as well as the forms of price discrimination, are selected.
In the future, as part of the implementation of the strategy, tactical measures are developed (to stimulate sales ), including systems of price discounts and non-price incentives for buyers.
Prices are actively used in competition to ensure a sufficient level of profit. Determining the prices of goods and services is one of the most important problems of any enterprise, since the optimal price can ensure its financial well-being. The current pricing policy largely depends on the type of goods or services offered by the enterprise. It is formed in close connection with the planning of the production of goods or services, identifying consumer demands, and stimulating sales. The price should be set in such a way that, on the one hand, it meets the needs and requirements of buyers, and on the other hand, it contributes to the achievement of the goals set by the enterprise, which is to ensure the receipt of sufficient financial resources.
Within the framework of the general pricing policy, decisions are made in accordance with the situation in the target market of the enterprise, methods and marketing structure . The determination of the pricing policy is based on solving a number of questions: what price the buyer could pay for the product, how the price change affects the volume of sales, what are the constituent components of costs, what is the nature of competition in the market segment.
Pricing policy reflects the general goals of the firm, which it seeks to achieve by pricing its products. Pricing policy is the general principles that an enterprise intends to adhere to in the setting of prices for its goods or services.
With the help of various pricing methods, a specific price is set depending on certain circumstances or goals. To make a final decision on prices, the manager must consider all the proposed options for calculating prices. In the process of setting the price of products, the enterprise (firm) must clearly define the goals that it wants to achieve. The clearer they are, the easier it is to set prices for new products.
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