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ENPI MODULE 5
CREATING A PROMOTION PLAN
PRICING A PRODUCT/SERVICE
• Consider costs involved in creating
your products/services:
–Fixed costs: rent, utilities, insurance, etc
–Variable costs: cost of goods sold,
promotion, delivery, etc
SELECT A PRICING STRATEGY
• Cost Based Pricing
–Consider product costs and profit goals
–Calculate how much it costs to make
–Calculate a related “fixed cost” to apply
–Add a percentage to create a profit (your
mark up)
–You have your price!
SELECT A PRICING STRATEGY
• Demand Based Pricing
–Determine what customers are willing to
pay
–Add a percentage to create a profit (your
mark up)
–You have your price!
–This strategy is used in very few
situations
SELECT A PRICING STRATEGY
• Competition Based Pricing
–Determine what competition is charging
a customer
–Decide if you will be below, in line with,
or above that price
–You have your price!
–This strategy is used if your main focus
is having a competitive price
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