Some external environmental factors such as economic conditions are reported daily in the media and managers have a wealth of information on which to develop strategic plans. Of the countries that regulate prices, 36% set the price of generic medicines at a … Discuss the pricing decisions of generic drug manufacturers. The first one was a Delphi study among experts on most suitable monetary incentives to stimulate healthy eating (Reference Waterlander, Steenhuis and de Vet 24). Price is the amount customers are charged for items. Businesses who use ethical pricing strategies to sell their products and earn a profit are far more respected than those that hurt and defraud competitors or even consumers. It’s no secret that small businesses play a vital role in the US economy. Analysis of competition will include pricing by direct competitors, related products, and primary products. Top 3 Pricing Strategies . Pricing strategies in generic medicines Posted 01/10/2010 Eighty two per cent of countries impose pricing regulation while 18% opt for free market competition to control prices. However, some external factors may be difficult to identify, particularly of the pace of change is very slow or is hidden from view. General strategies. Profit-oriented pricing strategies are developed with high margin or specific profit objectives in mind. Companies that excel at this level avoid unnecessary downward pressure on prices and often emerge as industry price leaders. Pricing a product ethically is a major decision for any business. How well is your airline using the following factors to set prices? This strategy is combined with the other marketing pricing strategies that are the 4P strategy (products, price, place and promotion) economic patterns, competition, market demand and finally product characteristic. Economic conditions directly impact supply and demand - factors at the heart of all pricing decisions, regardless of industry. Customers: Managers examine pricing problems through the eyes of their customers. Marketing Methods Used. In 750-1,000 words, analyze the pricing strategies and discuss the following: Discuss the pricing decisions of generic drug manufacturers. If it's not the highest number you calculate, something's wrong. Therefore, a marketer should adopt a well- planned approach for pricing decisions. Factors Influencing Pricing Decisions: Among the many factors influencing the pricing decisions, the three major influences are customers, competitors and costs. The marketer should know the factors that influence the pricing decisions before setting the price of … A firm also has to look at a myriad of other factors before setting its prices. There’s a number of value-based pricing strategies you can use including: Value pricing: this strategy is based on what customers think a product or service is worth, rather than actual costs. During the years, more and more attention has been paid to the process of establishing the price. For example, if your markup is $20 and your product retails for $40, your percentage markup is: $20 / $40 = .50 or 50 percent. What factors contribute to the advantages and disadvantages of various pricing strategies? Competitors – a huge impact on pricing decisions. Internal Factors: 1. Having a pricing objective isn’t enough. These pricing strategies were derived from two studies that were conducted earlier. The Utility and Demand 3. A firm also has to look at a myriad of other factors before setting its prices. Pricing is often one of the most difficult things to get right in business. Evaluate the impact competitors and additional economic factors have on the results of the generic drug pricing strategies. Cost-oriented pricing strategies are developed with a focus on understanding cost basis and setting prices at a certain … In addition to these, consider the other strategic factors and find the number that provides the best balance among them. Pricing is often one of the most difficult things to get right in business. Advantages of demand pricing include the ability to optimize prices using charts and mathematics that predict ideal prices. However, revenue for small businesses can be scarce. Value pricing. What factors contribute to the advantages and disadvantages of various pricing strategies? Main factors affecting price determination of product are: 1. This cost includes both the variable and fixed costs. Product Cost 2. In theory, this occurs at a price where MR=MC. The Pricing Strategy Matrix shows how different levels of price and quality combine to form four commonly used pricing strategies: Figure 1: The Pricing Strategy Matrix The Pricing Strategy Matrix discussed in this article is derived from a paper by Joel Dean titled " Pricing Policies for New Products ." Pricing strategies Remember there is a big difference between costs and price.Costs are the expenses of a firm. There are three main approaches a business takes to setting price:Cost-based pricing: price is determined by adding a profit element on top of the cost of making the product.

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