MARKETING MANAGEMENT Chapter six: Pricing Decisions

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INTRODUCTION
Pricing is all around us. We pay for house rent, we pay for taxi, if need a laptop we must pay to
buy it. Everything has a price. The money claimed against the offered product or service in the
market is called price. In other words the value exchanged for use of the benefits of a certain
product or service by the customers is called price of that product or service.All profit
organizations and many nonprofit organizations must set prices on their products or services. Price
goes by many names. You pay rent for your apartment, tuition for your education, and a fee to
your physician or dentist. The airline, railway, taxi, and bus companies charge you a fare; the local
utilities call their price a rate; and the local bank charges you interest for the money you borrow.

Price may take the following forms.

Interest (price paid for bank loan)

Rent (price paid for hiring physical assets)

Fee (price paid for professional services)

Premium (price paid for insurances)

Fare (price paid for using transportation services) etc.

Price is the act of determining the exchange value between the purchasing power and utility or
satisfaction acquired by individual, group or an organization through the purchase of goods,
services, ideas etc. There are two main types of pricing which are as follow.

1) Fixed Price, in which single price is set for all customers

2) Dynamic Price that contains different prices for different customers on the basis of the situation.

FACTORS AFFECTING PRICING DECISIONS:

Price is not determined by a simple step rather there are many factors affecting pricing decisions.
The reason is that the price is a very sensitive issue for the customers in their purchasing behavior.
Following are the two main factors that affect pricing decisions.

1– Internal Factors

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2- External Factors

INTERNAL FACTORS:
Internal factors are those factors that are related to the internal environment of the business. This
means that the issues that prevail within the business organization and upon which the organization
has control are included in this category. Internal factors further include the following.

1. Marketing Objectives & Marketing Mix Strategies

2. Costs

3. Organizational Considerations

1. Marketing Objectives & Marketing Mix Strategies

The objectives of the business serve as a basis for the development of proper marketing mix
strategy that also includes in the price determination process. Those businesses that have kept clear
objectives feel convenience in setting an effective price for their products or services, because their
prices are built on the ground of stated objectives. Following are some of important objectives that
are covered by most businesses.

Survival:

In this objective the main purpose of the business is survival in the market. The profit maximization
purpose becomes secondary importance for such business, because its survival is at stake due to
unfavorable market conditions like tough competition, changes in tastes of customers etc. In this
case the business tries to keep its price low, so that a sufficient proportion of its product or service
should be sold.

Profit Maximization:

Another important objective is the profit maximization that is employed by many businesses. Such
businesses count the costs and demand of their products or services and set different prices. From
these price combinations, a business chooses the price that can give maximum profit, return on
investment or cash flow. This objective is beneficial for the short run and it neglects the long term
future of the business. Some businesses try to increase their market share for the purpose of getting

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highest profit, because their management believed that higher market share lead to lower cost and
hence higher profits. Businesses adopting such strategy also keep their prices low.

Product Quality Leadership:

A business can set its basic objective as the product quality leadership in the market. For this
purpose, such business keeps its price higher in order to cover the higher performance of its product
along with the costs incurred on research and development.

Price can be used to accomplish other objectives for a business. Example include lowering of price
to avoid increasing competition, keep prices competitive to make market stable and
avoid government intervention, to increase demand by lowering prices etc. In short the decisions
taken in respect of price affect other marketing mix variable decisions and so all of these decisions
should be consistent with one another to make a marketing program effective. The business should
also keep its product as differentiated and set relatively high price for the uniqueness of its product.
In this way price is based on many non-pricing factors.

2. Costs

Cost is the fundamental element in setting prices for a product or service. The simple rule is that
the business charges such price that should not only cover all of the costs incurred in
manufacturing, distribution and promotion of the product or service, but also provide a fair return
on the invested money. If a business has low costs, then it can increase its sales and profit by
lowering the price of its product or service.

Generally there are two major types of costs which are as follow.

a) Fixed Cost

b) Variable Cost

Fixed Cost:

The fixed cost is such cost that remains fixed and does not change with the changing level of
production or sales. The total fixed cost remains same but fixed cost per unit may change. The
example includes rent paid for the building, interest paid on loan, salaries to employee staff etc.

Variable Cost:

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The variable cost is that kind of cost which changes with the change in the level of production and
sales. Although the total variable cost change but the unit variable cost remains the same. For
example, each car produced includes the variable cost of tires, metal sheets, Misc items etc that
change with the increase or decrease in the quantity of production and sales.

The management of the business should ascertain different level of costs with respect to different
levels of production and sales so that the lowest cost can be attained for the determination of
effective prices for the manufactured products or services.

3. Organizational Considerations:

This factor includes the fact that who should be given the responsibility to set the price within the
organization. There many ways to deal with such an issue. In smaller businesses, top management
is responsible for setting the price of the product. On the other hand, in large organizations product
line managers or divisional manager has the authority to set price for the product or service. In
case of industrial markets, salespersons handle the pricing of product by negotiating with the
customers within the pre-specified range of prices. In certain price sensitive industries (Oil
Companies, Aerospace etc.) have a separate pricing department that can either directly determine
the best price or facilitates the pricing process of the business. In some firms, top management like
the proposed prices of the lower level employees like salespersons etc.

EXTERNAL FACTORS
External Factors include factors that are related to the external environment of the business. The
business has less control over these variables of the external environment. The following are
included in this category.

1) The Market and Demand

2) Costs, Prices and Offering of Competitors

3) Others

1. The Market and Demand:

We have already discussed that the lower limits of price are determined by the costs incurred. On
the other hand the upper limits are determined by the demand and market elements. Price is

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balanced by the benefits of owning the relative product or service by consumer and industrial
customers. For this purpose the price and demand relationship for a product is essential to be
understood before setting its price.

Pricing in different Markets:

Different market conditions require different sets of pricing strategies. Generally there are
following four types of markets.

1) Pure Competition

2) Monopolistic Competition

3) Oligopolistic Competition

4) Monopoly

1) Pure Competition

In case of pure competition in the market, there are many buyers and sellers in the markets dealing
with uniform commodities like wheat etc. There is one ongoing price in the whole market and no
single buyer or seller can affect this price. Because the customers can easily obtain their required
quantity at the ongoing price of the market, so no seller can charge higher prices. Similarly, no
seller can charge a lower price because he can sell all his offered quantity to a lot of customers on
the market. In case of the rise of the price or profit in the market, new sellers are attracted to enter
in the market. In pure competition, pricing, sales promotion, new product development and
marketing research are not supported. In other words the sellers on the market do involve in
preparation of marketing strategies. The best examples of a purely competitive market are
agricultural products, such as corn, wheat, and soybeans.

2) Monopolistic Competition

In case of monopolistic competition there are many sellers and buyers who offer their products not
at a single price but at a range of prices. The difference in the price range is due to the differentiated
product or service offering by the sellers. Customers can feel the difference between the products
and hence pay different price for them. These differences can be in shape of features, quality or
style etc. So in this kind of market businesses spend more time and money on differentiating their

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product or services in the shape of sales promotion, advertising etc. A single business is not
affected by the marketing strategies of its competitors because there are many competitors in the
market.

3) Oligopolistic Competition

In oligopolistic market, there are few sellers and buyers which are conscious about the pricing and
other marketing strategies of competitors. The offered products are either uniform or
differentiated. It is difficult for new seller to enter in the market. A certain change in the price of
single firm affects its own soil in a negative way even if a seller lowers its price; its competitors
also decrease their price. This means that the benefits are only for a short while.

4) Monopoly

Another market condition is monopoly in which there is only a single seller who can offer its
products or services at different rates. As the seller is single and the buyers are much more,
therefore the seller charges a relatively higher price because there is no fear of competition. In case
of regulated monopoly, the seller can charge only a fair price, but in case of unregulated monopoly
the seller has freedom to charge extra for its offering. But mostly the monopoly firm keeps its price
low for a number of reasons like quick penetration in the market, government intervention etc.

Consumer perception about value and price

In the end, the consumer will decide whether a product's price is right. Pricing decisions, like other
marketing mix decisions, must be buyer oriented. When consumers buy a product, they exchange
something of value (the price) to get something of value (the benefits of having or using the
product). Effective, buyer-oriented pricing involves understanding how much value consumers
place on the benefits they receive from the product and setting a price that fits this value. A
company often finds it hard to measure the values customers will attach to its product. For example,
calculating the cost of ingredients in a meal at a fancy restaurant is relatively easy. But assigning
a value to other satisfactions such as taste, environment, relaxation, conversation, and status is
very hard. These values will vary both for different consumers and different situations. Still,
consumers will use these values to evaluate a product's price. If customers perceive that the price
is greater than the product's value, they will not buy the product. If consumers perceive that the
price is below the product's value, they will buy it, but the seller loses profit opportunities.
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Price Demand Relationship

Businesses should also consider the important relationship between the price of a product or
service and its demand. Generally price and demand is inversely related which means that the
increase in the price would lead to the decrease in the demand for that product and vice versa. The
reason behind this inverse relationship is that the customers have limited resources for the
fulfillment of their demands. In some case the price and demand show the direct relationship which
means that the increase in the price would lead to the increase in the demand of that product in the
market. But this only happens with the prestigious products where increased price means increased
quality. The business management should also consider the elasticity of the demand of their
offering product while setting its price.

2. Costs, Prices & Offering of Competitors:

One of external factors affecting pricing decisions of the business is the costs, price and offering
of the competitors as compared to its own cost, price & offering. This means that the management
of the business should take into account the change in the price and offering of the competitors
and take steps accordingly.

3. Others

There are also some other external factors that are important to be considered in determining a
price for a product or service, like economic conditions of the country, government rules and
regulations etc. Economic factors such as boom or recession, inflation, and interest rates affect
pricing decisions because they affect both the costs of producing a product and consumer
perceptions of the product's price and value. The company must also consider what impact its
prices will have on other parties in its environment. How will resellers react to various prices? The
company should set prices that give resellers a fair profit, encourage their support, and help them
to sell the product effectively. The government is another important external influence on pricing
decisions. Finally, social concerns may have to be taken into account. In setting prices, a company's
short-term sales, market share, and profit goals may have to be tempered by broader societal
considerations.

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GENERAL PRICING APPROACHES:

The price the company charges will be somewhere between one that is too low to produce a profit
and one that is too high to produce any demand. Product costs set a floor to the price; consumer
perceptions of the product's value set the ceiling. The company must consider competitors' prices
and other external and internal factors to find the best price between these two extremes.
Companies set prices by selecting a general pricing approach that includes one or more of three
sets of factors. We examine these approaches:

the cost-based approach (cost-plus pricing, break-even analysis, and target profit pricing);

the buyer based approach (value-based pricing)

the competition-based approach (going-rate and sealed-bid pricing).

COST BASED APPROACH:

In cost based pricing includes :
a. Cost plus pricing: The simplest pricing method is cost-plus pricing—adding a standard
markup to the cost of the product that means adding the expectations profit with the total cost of
the product determine the price in cost plus pricing approach. Construction companies, for
example, submit job bids by estimating the total project cost and adding a standard markup for
profit. Lawyers, accountants, and other professionals typically price by adding a standard
markup to their costs. Some sellers tell their customers they will charge cost plus a specified
markup; for example, aerospace companies price this way to the government

Suppose Unit cost=Rs 100 and profit margin 20 percent

Cost plus price= Unit cost + profit margin

So, cost plus price= 100+20= Rs. 120

b. Target return pricing: A target return on investment ROI is added to set a total price.

Formula: TRP= (Total cost + desired ROI)/Unit sales

Suppose: Total investment= Rs. 1000000

Target return is 20%, Total cost=500000, Total sales: 10000 unit

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Ans: Rs.70

c. Break-Even Analysis

Break-even is that point of sales volume where cost is equalized by the revenue and the profit is
zero. The estimated demands, break -even points and profits are compared with different prices by
the management of business. Break-even is the point of zero loss or profit. At break-even point,
the revenues of the business are equal its total costs.

Break-even Sales Units=FC / (selling price per unit − variable price per unit)

BEP in Sales Rs= Selling Price per Unit × Break-even Sales Units

Calculate break-even point in sales units and sales dollars from following information:

Selling Price per Unit = Rs.15, Variable Cost per Unit = Rs. 7, Total Fixed Cost = Rs. 9,000

Solution

We have,
p = Rs. 15
v = Rs. 7, and
FC = Rs. 9,000

Substituting the known values into the formula for breakeven point in sales units, we get:

Breakeven Point in Sales Units (x)

= 9,000 ÷ (15 − 7)
= 9,000 ÷ 8
= 1,125 units

Break-even Point in Sales Rs. = 15 × 1,125 = Rs. 16,875

BUYER BASED PRICING APPROACH:

This pricing approach is extensively applied by many organizations in which the perceived value
of buyer is regarded as a base for Setting Price for a product or service. In this pricing model the
value of product or service is perceived by customers that give the guideline for the price of that
product or service. In other words the price is not set after the production of product, but before

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the production. This means that the organization considers the customers along with their
perception about certain product or service. On this basis, the business sets a certain price and then
starts manufacturing that product. The expected value and price provide guideline for the cost and
design of the product so that it can match the perceptions of the customers.

It is difficult for a business organization to ascertain the different perceived value by the customers
on different products. For this purpose these organizations conduct surveys and experiments. If a
business keeps the price of its product higher than the perceived value of customers, then its sales
are affected. On the other hand, if a business keeps its product’s price lower, then maybe its sales
increase, but the profit does not increase accordingly. Therefore, those organizations, which want
to adopt this value-based pricing strategy, should keep the price of their products in accordance
with their perceived value by customers. But more effective strategy is that the businesses should
try to deliver more value to the customers than they perceived in order to retain them as loyal
customers.

COMPETITION-BASED PRICING APPROACH:

In this pricing model, businesses keep the price of their products or services on the basis of the
prices of their competitors. Also, customers in the market perceived value to any product or service
in relation to prices of similar products of competitors. So there is some sort of going rate pricing
in which the prices of products are altered according to changes in the prices of competitors. For
example, steel or fertilizer manufacturing businesses face oligopolistic competition in which they
charge almost similar prices in the market same like the competitors. There is a market leader
whose price is followed by all other smaller competitors. When the price of market leader is
changed, other competitors in the market also adjust their prices accordingly. Some smaller
business may keep a slight difference in their price as compared to the market leader, but this slight
difference remains constant in different conditions.

There is one big advantage of adopting this ongoing rate of competition based pricing, which is
the prevention of price wars in the market among competitors. Another form of competition,
pricing model is sealed bid pricing in which the price of a job is raised by keeping in view the
prices set by competitors. In this case the pricing also ignores the cost and demand factor, but the
businesses try to keep their prices little higher than their cost in order to earn a revenue.

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Pricing is not confined to only above categories rather there are other Factors that Affect the
Pricing Decisions like environmental etc.

PRICING STRATEGIES
Pricing is most important part of a company marketing mix strategies. Pricing can help or hinder
a company products or services sale. Every company sell either a product or a service, and all
companies have to choose the price to sell their products or services at, which is difficult choice
than most people realize.

Pricing can be defined as the process of determining what a company will receive from its
customers in exchange for the products or services it sells. It is very important for a company to
manage its pricing strategies in allegiance with the requirements of industry in which company
operates, the markets in which company supply its products, the customers with whom company
transact and the objectives that company wants to achieve. Ultimately every company exists to
make money, so the general aim of pricing strategies is to maximize the profit that the company
can make.

DIFFERENT TYPES OF PRICING STRATEGIES

Pricing strategy refers to method companies use to price their products or services. Almost all
companies, large or small, base the price of their products and services on production, labor and
advertising expenses and then add on a certain percentage so they can make a profit. There are
several different pricing strategies. Following are some types of pricing strategies that can be
adopted by a company to achieve its goals in accordance with its business nature.

 New product pricing strategies

 Product mix pricing strategies

 Price adjustment strategies

NEW PRODUCT PRICING STRATEGIES:

Pricing strategies usually change as the product passes through its life cycle. The introductory
stage is especially challenging. Companies bringing out a new product face the challenge of setting

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prices for the first time. They can choose between two broad strategies: market-skimming pricing
and market penetration pricing.

Market-Skimming Pricing

Skimming involves goods being sold at higher prices so that fewer sales are needed to break even.
Selling a product at a high price and sacrificing high sales to gain a high profit is therefore
"skimming" the market. Skimming is usually employed to reimburse the cost of investment of the
original research into the product. It is commonly used in electronic markets when a new range,
such as DVD players, are firstly dispatched into the market at a high price. This strategy is often
used to target "early adopters" of a product or service. Early adopters generally have a relatively
lower price-sensitivity and this can be attributed to their need for the product outweighing their
need to economize, a greater understanding of the product's value, or simply having a
higher disposable income.

Market Penetration Pricing

In the introductory stage of a new product's life cycle means accepting a lower profit margin and
to price relatively low. Such a strategy should generate greater sales and establish the new product
in the market more quickly. Penetration pricing is the pricing technique of setting a relatively low
initial entry price, often lower than the eventual market price, to attract new customers. The
strategy works on the expectation that customers will switch to the new brand because of the lower
price. Penetration pricing is most commonly associated with a marketing objective of
increasing market share or sales volume, rather than to make profit in the short term.

Product Mix Pricing Strategies in Marketing

Pricing is an important part of a company’s marketing mix strategies. Pricing strategy helps to
increase a company’s product or service sales in selected market. It also have direct impact on
growing company’s market share. So we can say that pricing is one of the most important factors
of a company’s marketing mix strategy. Before proceeding towards the main topic “product mix
pricing strategies in marketing” first you should be aware of this common marketing terms
“product mix or product portfolio”. Three most common definitions of product mix.

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 The product mix is the collection of all those products and services that a particular
company offers in the market.

 The set of all product line or item which a particular seller offers to sale.

 The number of all product of similar nature or kind offered by a particular seller for sale.

5 Types of Product Mix Pricing Strategies

When the product is a part of product mix or portfolio, companies adopt five kinds of pricing
strategies in marketing which are as under:

Product Line Pricing

This strategy is used for setting the price for entire product line. Many companies now a day
develop product line instead of a single product. So product line pricing is setting the price on the
base of cost difference between different products in a product line. Marketer also keeps in mind
the customer evolution of different features and also competitive prices.

Optional Product Pricing

This strategy is used to set the price of optional products or accessories along with a main product.
For example refrigerator comes with optional ice maker or CD players and sound systems are
optional product with a car. Organizations separate these products from main product because
organizations want that customer should not perceive products are costly. Once the potential
customer comes to the show room, organization employees explain the benefits of buying these
optional or accessory products.

Captive Product Pricing

This is strategy used for setting a price for a product that must be used along with a main product,
for examples blades with razor and films with a camera. Gillette sells low priced razors but
company make money on the replacement of cartridges. Producers of the main products (cameras,
video game consoles, and computers) often price them low and set high markups on the supplies.
Thus, camera manufactures price its cameras low because they make its money on the film it sells.
In the case of services, this strategy is called two-part pricing. The price of the service is broken
into a fixed fee plus a variable usage rate. Thus, a telephone company charges a monthly rate—

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the fixed fee—plus charges for calls beyond some minimum number—the variable usage rate.
Amusement parks charge admission plus fees for food, midway attractions, and rides over a
minimum. The service firm must decide how much to charge for the basic service and how much
for the variable usage. The fixed amount should be low enough to induce usage of the service;
profit can be made on the variable fees.

By-Product Pricing

By-product pricing is determining of the price for by-products in order to make the main product’s
price more attractive and competitive. For example processing of rice results in two by-products
i.e. rice husk and rice brain oil, and sugar cane with husk. Now if company sells husk and brain
oil to other consumers, they will generate extra revenue by adopting this by-product pricing. Using
by-product pricing, the manufacturer will seek a market for these by-products and should accept
any price that covers more than the cost of storing and delivering them. This practice allows the
seller to reduce the main product's price to make it more competitive. By-products can even turn
out to be profitable. For example, many lumber mills have begun to sell bark chips and sawdust
profitably as decorative mulch for home and commercial landscaping.

Product Bundle Pricing

This is a common price and selling strategy adopted by many companies. Many companies offer
several products together this is called a bundle. Companies offer the bundles at the reduced price.
This strategy helps many companies to increase sales, and to get rid of the unused products. This
bundle pricing strategy also attracts the price conscious consumer. Best example is anchor
toothpaste with brush at offered lower prices. Thus, theaters and sports teams sell season tickets at
less than the cost of single tickets; hotels sell specially priced packages that include room, meals,
and entertainment; computer makers include attractive software packages with their personal
computers. Price bundling can promote the sales of products consumers might not otherwise buy,
but the combined price must be low enough to get them to buy the bundle.

PRICING ADJUSTMENT STRATEGIES IN MARKETING

Price is a strong element of marketing strategy of any company. Price has direct impact on the
customer, customer buying behavior, business and on the overall economy. To customers the price
is a major indicator of good quality product and also important factor in making decision about its
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purchase. Price strategy is therefore, most vital and critical area of marketing strategy. In deciding
the price the business management and marketer must consider, the kind of competition in the
market, elasticity of demand of that particular product and the cost of production.

Many Companies usually adjust their basic prices keeping in view various customer differences
and market changing situations. If a company adopt effective pricing strategies, company become
able to secure better market shares.

TYPES OF PRICING ADJUSTMENT STRATEGIES

There are six price adjustment strategies in marketing.
Discount and Allowance Pricing

Most companies adjust their basic price for rewarding their customers due to customer quick
responses. Such as early payment of bills by customers, bulk purchases, and off-season buying etc,
so in these cases companies offer certain amount of discount or allowance to their customers. Such
price adjustments called discounts and allowances pricing strategies. Discount is a straight
reduction in price by company on purchase while allowance is promotional money paid by
company to retailer in respect of an agreement to feature the company’s product in some way.

A cash discount is a price reduction to buyers who pay their bills promptly. A typical example
is"2/10, net 30," which means that although payment is due within 30 days, the buyer can deduct
2 percent if the bill is paid within 10 days. The discount must be granted to all buyers meeting
these terms. Such discounts are customary in many industries and help to improve the sellers' cash
situation and reduce bad debts and credit collection costs.

A quantity discount is a price reduction to buyers who buy large volumes. A typical example
might be "Rs10 per unit for less than 100 units, Rs9 per unit for 100 or more units. By law, quantity
discounts must be offered equally to all customers and must not exceed the seller's cost savings
associated with selling large quantities. These savings include lower selling, inventory, and
transportation expenses. Discounts provide an incentive to the customer to buy more from one
given seller, rather than from many different sources.

A functional discount (also called a trade discount) is offered by the seller to trade channel
members who perform certain functions, such as selling, storing, and record keeping.

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Manufacturers may offer different functional discounts to different trade channels because of the
varying services they perform, but manufacturers must offer the same functional discounts withi
each trade channel.

A seasonal discount is a price reduction to buyers who buy merchandise or services out of season.
For example, lawn and garden equipment manufacturers offer seasonal discounts to retailers
during the fall and winter months to encourage early ordering in anticipation of the heavy spring
and summer selling seasons. Hotels, motels, and airlines will offer seasonal discounts in their
slower selling periods. Seasonal discounts allow the seller to keep production steady during an
entire year.

Allowances are another type of reduction from the list price. For example, trade-in allowances are
price reductions given for turning in an old item when buying a new one. Trade-in allowances are
most common in the automobile industry but are also given for other durable goods. Promotional
allowances are payments or price reductions to reward dealers for participating in advertising and
sales support programs.

Segmented Pricing

In segmented pricing strategy, the company sells a product or service at two or more prices, and
difference in prices not based on cost. There are several forms of segmented pricing like under
customer-segment pricing, under product-form pricing and more. Museums are sample example
of this as they charge a lower admission from students and senior citizens. Variation of theater or
cinema seat prices is also an example of segmented pricing. Companies also charge different prices
in different region for same products.

Psychological Pricing

Psychological pricing strategy approach considers the psychology of different customers in respect
of their products. Price actually says something about the product features and characteristics. For
example, many customers use price to judge the quality of the product and services. For example
a person wants to purchase perfume, he asks the price from shopkeeper and he told different prices
of two bottles as 1000 for one and 400 for other. Now customer will be willing to pay 1000 because
this higher price indicates something special.

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Promotional pricing

Promotional pricing strategy promote or introduce a particular product or service. This is the
temporary price companies charged for their products or services and this price may be below then
list price and sometimes even below then incurred cost. Some supermarkets and departmental
stores offers lower prices to attract customers. Promotional pricing may also have adverse effects
for example constantly reduced prices can deliver a message to customer about lower brand's
quality in the mind of customers.

Geographical Pricing

Geographical Pricing is adopted by many companies now a day. In this pricing strategy companies
decide to price its products or service for different customers on the base of geographical location
in different parts of the country or world. This is actually relates to buying power of customers.
Companies charge high prices in elite class areas and low prices in backward areas.

International Pricing

Many companies now a day’s launch their products internationally. Such companies need to decide
what prices to they will charge in the different countries in which they operate. Some companies
may also set a uniform worldwide price. International pricing strategy depends on many factors of
a specific country like economic conditions, laws and regulations of that country, competitive
situations in that country, and development of the wholesaling and retailing system in a particular
country.

MANISHA ADHIKARI 17