Generally, the pricing methods can be grouped into four main categories, namely the method of pricing based on demand, based on costs, profit-driven and based competition.
Pricing method based Application
Is a method that focuses on factors that influence consumer tastes and preferansi that factors such as costs, profits, and competition. Their customer demand own based on various factors, including:
• The ability of customers to buy (purchasing power).
• the willingness of the customer to buy.
• Positioning a product of lifestyle customer, such as whether the product is a symbol of social status or simply a product of everyday use.
• Benefits provided these products to customers.
• The price of substitutes.
• The potential market for these products.
• The nature of non-price competition.
• consumer behavior in general.
• Market segments.
At least, there are seven pricing methods, including the method of pricing based on demand, namely:
Pricing creaming
This strategy is implemented by setting a high price for a new product or innovation in the introductory phase and then lower the price at the time of starting the tight competition. This strategy can work well if consumers are not price sensitive, but rather emphasizes considerations of quality, innovation and product capabilities to meet the needs.
Penetration pricing
In this strategy, the company tried to introduce a new product with a low price in the hope that it will be able to obtain a large volume of sales in a relatively short time. The purpose of this strategy to achieve economies of scale and reduce the cost per unit. At the same time penetration strategy may also reduce the interest and ability of its competitors because of low prices caused margins to be obtained every peusahaan limited.
Prestige Award
Strategy is to establish a high price level that consumers are very concerned about the status will be interested in these products and then buy. Whereas if the price reduces to some extent, demand for products or services will decrease. Products that are often associated with prestige pricing include jewelry, diamonds, luxury cars, and so on.
The price range
More commonly used at retail. Here, sellers determine a price level of all goods sold. For example: a store that sells various types of footwear with designs, sizes and different qualities, determine the price of 3 levels of Rp. 30.000, -, cts. 50.000, – and cents. 100.000, -. This will facilitate decision making for consumers to buy with prices that match their financial capabilities.
Old Event Pricing
This pricing method is often used for selling goods at the retail level. In this method, the price fixed by an odd number or size of the price, even close to a certain amount. Thus, the price of Rp. 2975 for a particular group of consumers still think that the price is always in the price range of USD 2000.
Demand-Backward Pricing
When the price is in the process of walking backwards, which means The Corporation believes that a price level that consumers are willing to pay, the company should determine the margin paid to wholesalers and retailers. After that, the new price may be determined
Bundle Price
The marketing strategy is two or more products in one package. This method is based on the idea that consumers appreciate the value of a particular package as a whole rather than the value of each item individually.
For example, travel agency offers vacation packages that include transportation, lodging, and consumption. This method offers a great manfat for buyers and sellers. Consumers can save the cost, while the seller can reduce the cost of marketing.
Methods Cost-based Pricing
In this method, the determinants of price are the main aspects of supply or cost rather than on aspects of the application. The price is determined on the basis of production costs and marketing are added with a certain amount to cover direct costs, overheads and profits. Method of cost-based pricing comprises:
Standard Markup Pricing
Pricing is determined by adding the percentage (markup) certain costs on all items in a category of products. Percentage amount of the increase varies by type of product sold.
Usually, the products subject to high levels of markup perputarannya smaller than the product level perputarannya low.
Cost Percent Cost Plus Pricing
The price is determined by adding a certain percentage of the cost of production or construction. This method is often used to determine the price of an item or only a few elements. For example, a firm of architects responsible for up to 15% of the cost of building a house. So if the cost of building a house valued at $ 100 million and expenses of architects from 15% of construction costs (USD 15 million), and eventually the price of Rp 115 million.
Plust Cost Fixed Fee prices
This method is used in many products that are highly technical in nature, such as automobiles, aircraft, or satellite. In this strategy, the supplier or manufacturer will get in exchange for all costs incurred, regardless of size. But the manufacturer or supplier can only get a certain sum as profit on the cost of the final draft agreement.
Method based on Pricing
This method seeks to balance revenue and costs in the price mpenetapan. These efforts can be made on the basis of specific objectives or volumelaba expressed as a percentage of sales or investments. Method based on pricing consists of charging a profit target profit, target return on the sale price and the target return on the investment price.
Pricing method based competition
On the basis of considerations other than cost, demand, or profits, price can be determined on the basis of a competition, what their competitors. Method of pricing based on competitive pricing customary; above or below market prices, product pricing and charging sealed bids.
Special Adjustment of Price
Specific adjustments in prices, according to the list (list price) consists of a discount, allowance, and the geographical adjustments (geographic adjustment).
Discount
Discounts are discounts offered by the seller to the buyer as a reward for a particular activity of the unpleasant buyer to the seller. These discounts are usually manifested in the form of money or goods and is intended to attract consumers. There are four types of discounts, quantity discounts ie, seasonal discounts, discount and trade discount.
Quantity discounts
Discounts are offered by the seller to encourage consumers to be willing to buy in larger quantities, or are willing to concentrate their purchases from these suppliers to increase the overall volume of sales. For example, a purchaser to buy at least 10 units, then given a discount of 5% and if the purchase is less than 10 units were not cut.
Seasonal Discounts
Discounts are given to buyers to make purchases outside of a particular season. For example, buyers who purchase a raincoat in the summer, will take advantage of discounts of 5%, 10% and 20%.
CashBack
Parts are delivered to the buyer for payment over and they make payments on time. For example, a seller offers a product with the payment terms. If the buyer can pay within 10 days, they get a 2% discount and payment must be made within 30 days after goods received.
Trade discount
Also known as functional pieces are offered discounts to the buyer for payment to the marketing functions that they do. So the trade discount is given to buyers who come to market its products. They include dealers, wholesalers and retailers.
Allowance
As with any discount, allowance is also reduced prices (list price) to the buyer because of certain aktivitasaktivitas committed buyers. There are three types of allowances commonly used, namely:
Trade benefits
Discounts are given in the trading system.
Allocation of Promotion
Discounts are given to the seller or distributor who made the distribution of advertising or sales activities which may promote a certain product manufacturers. Advertising form of compensation may be paid in cash or a few products and no more.
Product Allocation
Discounts are given to buyers who are willing to buy property in abnormal conditions.
Geographic adjustment (geographic adjustment)
Geographic adjustment is adjusting the price by the manufacturer or wholesaler is also a geographic adjustment for price adjustments made by the producer or also in relation to the cost of transporting the product from seller to buyer. The cost of transportation is an important component of total variable costs, which determine the final price paid by the buyer. There are two methods commonly used to make geographic adjustments, namely:
FOB (Free On Board) Origin Price
FOB (Free On Board) means that the seller bears the costs until the loading of product used to transport (eg ships, trucks, trains, etc.). In general, the FOB (Free On Board) sellers pricing origin determine the location of loading the product, which is a seringkalinya factory, warehouse sales, or the port nearest to the location sellers. Product liability will be transferred to the buyer when the product is loaded into transport vehicles. All transportation costs and product handling incurred as a result of the buyer. The buyers will find most of the largest transportation costs.
Uniform delivered pricing
In this method, the seller set the price includes all transportation costs. Sellers to determine how transportation, pay freight, and responsible for damage that may occur. Therefore, the seller is responsible to the product acceptable buyer.
