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d1i1m1o1n [39]
3 years ago
7

When a company is to calculate the selling price of their products, they set up a product calculation. There are five benefits t

o the business when making a product calculation. Explain these five benefits.
Chemistry
1 answer:
iren [92.7K]3 years ago
5 0

Answer:

The pricing strategy is an important element in setting up the selling price of a product.

Explanation:

The pricing strategy is an important consideration while fixing up the selling price of product manufactured. When setting up a selling price of a product, the companies set up product calculation. Businesses should decide the pricing strategy before they advertise the products to the customers.  

There are mainly 5 benefits to the businesses while doing a product calculation. They are:

--- Doing competition based pricing enables the company to compete with the rival companies product and is based on the market based study. Competition pricing is a useful tool for the retailers as well as the small businesses.

---  Doing a cost plus pricing helps the total cost of making the product and also an add up in the market in order to determine the pricing of the product.

--- Dynamic pricing :

    Dynamic pricing is a non static pricing. Dynamic pricing is an efficient method for the market based on the supply and demand.

--- Penetration pricing :

 Penetration pricing is used by the large companies which is used to capture the market share by the setting product prices at the below market level so as to gain customers.

--- Doing a research for the price skimming helps the company to set up the accurate price for the product rather than readjusting the prices of the product later on based on the demand and the supply.

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