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Fang, Yan, Yiping Jiang, and Xingxing Han. "Bundle Pricing Decisions for Fresh Products with Quality Deterioration." Journal of Food Quality 2018 (2018): 1–8. http://dx.doi.org/10.1155/2018/1595807.
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How to sell fresh products quickly to decrease the storage cost and to meet customer quality requirement is of vital importance in the food supply chain. Bundling fresh products is an efficient strategy to promote sales and reduce storage pressure of retailers. In this paper, we consider the bundle pricing decisions for homogeneous fresh products with quality deterioration. The value of fresh products with quality deterioration is approximated as an exponential function based on which customer’s reservation prices are calculated. A nonlinear mixed integer programming model is used to formulate the bundle pricing problem for fresh products. By adding auxiliary decision variables, this model is converted into a mixed integer linear program. Numerical experiments and sensitive analysis are conducted to provide managerial insights for bundling fresh products with quality deterioration.
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Crosno, Jody L., and Annie Peng Cui. "Something old, something new: the role of partitioned pricing in consumers’ preference for new versus used products." Journal of Consumer Marketing 35, no. 4 (June 11, 2018): 353–65. http://dx.doi.org/10.1108/jcm-02-2017-2091.
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PurposeThis research aims to represent an initial exploration of how partitioned pricing influences consumers’ purchase decisions of new versus used products from the theoretical perspectives of prospect theory and gain/loss decision frames.Design/methodology/approachFour experiments to test the hypotheses with multiple product categories have been conducted.FindingsResults from a series of experimental studies find that consumers prefer partitioned pricing over all-inclusive pricing for new products, whereas all-inclusive pricing is more preferred for used products. In addition, the authors demonstrate that a high-quality brand can reverse this effect for used products; specifically, consumers prefer partitioned pricing over all-inclusive pricing for a used product with a high-quality brand.Originality/valueThis research contributes to the literature on second-hand consumption by examining the impact of pricing strategies on consumer purchase decisions of new versus used products. This study deepens our understanding of consumer decision-making for new versus used products and it provides implications for bolstering sustainable consumption.
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Abbey, James D., Rainer Kleber, Gilvan C. Souza, and Guido Voigt. "The Role of Perceived Quality Risk in Pricing Remanufactured Products." Production and Operations Management 26, no. 1 (September 22, 2016): 100–115. http://dx.doi.org/10.1111/poms.12628.
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Stamatopoulos, Ioannis, and Christos Tzamos. "Design and Dynamic Pricing of Vertically Differentiated Inventories." Management Science 65, no. 9 (September 2019): 4222–41. http://dx.doi.org/10.1287/mnsc.2018.3136.
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We study a model in which a monopoly firm designs the quality profile of its inventory and then dynamically updates its pricing menu for a finite selling horizon to maximize revenue. In a counterfactual scenario, a social planner goes through the same process to maximize total welfare. We show that in both scenarios the problem of dynamically pricing heterogeneous-quality (vertically differentiated) inventories is equivalent to that of dynamically pricing homogeneous-quality inventories, in the sense that a solution to one implies a solution to the other. Moreover, we prove a strong scarcity result, which suggests that the sale of a product drives up the prices on all remaining products, whether of higher or lower quality. We then consider product line design under a production technology that utilizes costly and potentially limited resources. We show that with unlimited (but costly) resources, the revenue maximizer undersupplies quality to all products compared with the social planner. With limited resources, we show that the revenue maximizer exhibits elitism: he overallocates (underallocates) resources on the production of high-quality (low-quality) products. However, as the volume of expected consumer arrivals increases to infinity, both the revenue maximizer and the welfare maximizer allocate resources equally across products. This paper was accepted by Serguei Netessine, operations management.
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Taleizadeh, Ata Allah, Shima Rezvan Beydokhti, Leopoldo Eduardo Cárdenas-Barrón, and Somayeh Najafi-Ghobadi. "Pricing of Complementary Products in Online Purchasing under Return Policy." Journal of Theoretical and Applied Electronic Commerce Research 16, no. 5 (June 2, 2021): 1718–39. http://dx.doi.org/10.3390/jtaer16050097.
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In online purchasing, customers may return products due to dissatisfaction with the quality of the product, and receive a refund based on the return policy, which is determined by online distributors. Online distributors can offer generous policies to attract more customers, but at the cost of reducing total profits. In this paper, the effect of the pricing and quality of complementary products (products sold together with other items) in online selling under the return policy is investigated. For this purpose, a mathematical model is developed to obtain optimal values for selling price, refund amount, and quality of products. Based on analytical results, a solution algorithm is proposed to solve the numerical examples and perform sensitivity analysis. Findings reveal that, while increasing the sensitivity of demand with respect to the refund amount, the price, quality, and refund on returned products should be increased. In addition, the online distributor should increase the quality of products when customers are more sensitive to the quality of products. Among other results, the selling price is shown to be negatively affected by demand elasticity with respect to price. In this situation, the online distributor should reduce the quality level and the refund amount for returned products to avoid a sharp decline in profit. In addition, when the quality cost is high, the price and quality should be decreased and the refund amount unchanged.
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Ye, Yazhen, Yao Zhang, Guohua Liu, and Yangyong Zhu. "A measure based pricing framework for data products." Web Intelligence 18, no. 4 (May 14, 2021): 249–60. http://dx.doi.org/10.3233/web-210446.
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It has been widely recognized that data can be viewed as a kind of assets. But accounting for data assets and pricing data transactions are still difficult due to the lack of reasonable measurements of datasets or data products. Literatures of data pricing mainly focus on traditional pricing models including models basing on contents of data, demand of market, data quality, etc.. However, due to the particularity of data, the above models may not coincide with the measure theory and thus suffer from some problems. For example, they do not consider how to price datasets sharing common contents; whether we should pay for a repeat purchase; and how to define peak-valley tariff formally for usage-based pricing. To tackle the above problems, in this paper, we formally define measure spaces for datasets and data products. Specifically, we introduce the measures on discrete, continuous and product data spaces respectivaly. Further we introduce the integral and propose a measure based pricing framework for data products. Our work is parallel to existing pricing models. We fouce on how to measure data, and pricing data is a natural extension by integrating the unit price function under the measure. In contrast, existing models focus on determining total prices directly by considering lots of factors like contents of data, demand of markets, etc. By doing analyses on several real-world applications and cases, we prove the effectiveness and generality of our proposal.
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Olbrich, Rainer, and Hans Christian Jansen. "Price-quality relationship in pricing strategies for private labels." Journal of Product & Brand Management 23, no. 6 (September 9, 2014): 429–38. http://dx.doi.org/10.1108/jpbm-06-2014-0627.
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Purpose – This article aims to close some research gaps by differentiating between brand types and price tiers. Many consumers perceive high prices as signals of high quality, yet researchers tend to find only low average correlations between price and objective quality. Previous studies do not account for market shares and paid prices though. Design/methodology/approach – A German consumer panel with more than 30,000 households reveals market shares and paid prices. Combining these data with product test ratings, the authors evaluate price-quality relationships with Spearman’s rank correlation coefficients and distinguish food from non-food products, national brands and private labels and three price tiers. Findings – High price-quality correlations for national brands and non-food private labels indicate that a higher price signals greater product quality. For food private labels, negative correlation coefficients inhibit the use of price as a quality indicator. The price-quality relationship for food private labels implies strong competition among brand owners, based on the price and quality of their products. Originality/value – This article investigates price-quality correlations by accounting for paid prices and product market shares; it also reveals differences across food and non-food products, national brands and private labels and different price tiers against the background of competition strategies. By addressing when consumers use price as a quality indicator, it outlines important managerial implications for manufacturers, retailers and consumers.
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Xiao, Lu, Hang Zhang, and Yong Qin. "Competitive Pricing of Innovative Products with Consumers’ Social Learning." Sustainability 12, no. 9 (May 7, 2020): 3806. http://dx.doi.org/10.3390/su12093806.
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Consumers often face valuation uncertainty when innovative products are introduced into market, and they may update the valuation about product quality based on historical sales information over time. Based on this background, this study constructed a two-period duopoly model of innovative products and investigated the effect of consumers’ social learning on enterprises’ pricing strategies and profits. Optimal pricing decisions for competitive enterprises with and without consumers’ social learning were obtained. It was found that consumers’ social learning will intensify competition between enterprises, which will lower their prices and profits. The stronger the learning intensity of consumers, the greater the profit loss for enterprises.
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Ferencz, Árpád, and Márta Nótári. "The consumer judgement of the price of the traditional foods." Analecta Technica Szegedinensia 8, no. 1 (January 11, 2014): 77–80. http://dx.doi.org/10.14232/analecta.2014.1.77-80.
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Price strategy is a peculiar aspect of the marketing model called Marketing Mix. Pricing related decisions usually constitute the hardest and most sensitive set of decisions that entrepreneurs have to make. The Hungarian consumers' high price sensitivity coupled with a high demand for low-cost products and services indicates the significance of pricing in Hungary. Pricing is crucial in raising interest and winning new customers. Prices might reflect product quality, brand strength and recognition, just like product differentiation or the image of a product or its producer. Consumers of traditional region-specific horticultural and agricultural products are willing to pay a higher price in appreciation of the high quality and special character of these products as this consumer segment tends to assign emotional functions to certain product features instead of solely focusing on the functionality and usefulness of the goods.
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Ingenbleek, Paul T. M. "Price strategies for sustainable food products." British Food Journal 117, no. 2 (February 2, 2015): 915–28. http://dx.doi.org/10.1108/bfj-02-2014-0066.
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Purpose – Sustainable products often suffer a competitive disadvantage compared with mainstream products because they must cover ecological and social costs that their competitors leave to future generations. The purpose of this paper is to identify price strategies for sustainable products that minimize this efficiency disadvantage. Design/methodology/approach – The strategies and their determinants from the pricing environment are derived from an inductive sequential case study of certified food products, such as organic and fair trade products. Data are collected through desk research and interviews. Findings – The results reveal six different strategies that build on three basic mechanisms: cost-based pricing in combination with price fairness, increasing willingness to pay through perceptions of quality and/or price, and price stability in which costs are compensated for by scale and/or learning effects. Research limitations/implications – The framework can help companies that offer sustainable products strengthen their market positions and it can help policy makers that partly rely on markets to achieve sustainability objectives. Originality/value – The existing pricing literature on sustainability predominantly takes a consumer approach. This study breaks new ground by extending this work with a strategic marketing approach offering a choice set of strategies for managers.
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Chen, Mingchun, Zhiying Liu, and Chaoliang Ma. "Early bird or versioning." Asia Pacific Journal of Marketing and Logistics 32, no. 3 (July 18, 2019): 769–92. http://dx.doi.org/10.1108/apjml-12-2018-0529.
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Purpose Crowdfunding, especially reward-based crowdfunding, has quickly evolved into a commonly used vehicle for innovating entrepreneurs to develop their products. Many crowdfunding platforms allow creators maximum flexibility in terms of the prices and rewards offered in a project to gain sufficient capital. However, creators need to understand how to design project rewards and how to select a pricing strategy, in addition to whether the creator should spend resources on designing multiple rewards of varying quality. The purpose of this paper is to address these issues by answering whether and why there are significant differences in the application of early-bird and versioning pricing strategies in crowdfunding. Design/methodology/approach This paper develops a two-stage dynamic game model with incomplete information, proposes a corollary calculated by analyzing a perfect Bayesian equilibrium, and then tests Corollary 1 by empirical analysis. Findings Contrary to the findings of other studies, the results show that an early-bird pricing strategy is likely better than a versioning pricing strategy for earning greater revenue in a crowdfunding context, on average. This finding means that creators do not have to spend as much in designing rewards of various qualities; rather, they should only provide multiple price options for high-quality rewards. However, if the heterogeneity of target backers’ valuations and the quality difference between two types of products are adequately high, a versioning pricing strategy may be a good choice for creators. Practical implications This paper provides a reference for creators regarding the selection of pricing strategies and the design of reward quality when launching crowdfunding projects. Originality/value This paper explains an interesting and practical issue in the design of reward quality and the selection of a pricing strategy after fully considering the role of the crowdfunding all-or-nothing mechanism and special backer behavior.
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Li, Ji-cai, Ji-hong Lu, Qi-liang Wang, and Changwen Li. "Quality and Pricing Decisions in a Two-Echelon Supply Chain with Nash Bargaining Fairness Concerns." Discrete Dynamics in Nature and Society 2018 (2018): 1–19. http://dx.doi.org/10.1155/2018/4267305.
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Product quality and pricing, as the important competitive tools, play a key role in attracting consumers. In a supply chain, the decisions on product quality and pricing are usually interlinked and would influence the cooperation relation between the members, especially when they are fairness-concerned and have different bargaining power. However, linking the quality and pricing decisions to the decision-makers’ behavioral factors such as fairness concern draws a little attention in the literature of supply chain management. This paper incorporates the members’ fairness preference and bargaining power into the product quality and pricing decisions in a two-echelon supply chain, where the supplier offers core components with a certain quality level to the downstream manufacturer, who subsequently sells the final products in the end market. Both the supplier and the manufacturer are assumed to be fairness-concerned by adopting Nash bargaining solutions as their fairness reference points. We use game-theoretic models to analyze the equilibrium product quality and pricing strategies under the setting of integrated and decentralized supply chain, respectively. Detailed comparisons and sensitivity analysis are further conducted to examine the impacts of members’ strengths of fairness concern, bargaining power, and decision structure on their equilibrium product quality and pricing strategies and corresponding payoffs.
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Setyaka, Haryo. "PENGARUH KUALITAS PRODUK, PROMOSI DAN HARGA TERHADAP PENJUALAN KAROSERI WING BOX DI PT. MITRA TOYOTAKA INDONESIA." JURNAL LENTERA BISNIS 6, no. 1 (December 21, 2017): 48. http://dx.doi.org/10.34127/jrlab.v6i1.166.
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<p><em>This study aims to examine and analyze the influence of the quality of products, promotions and pricing to sales product karoseri Wing Box at PT. Toyotaka Mitra Indonesia. The data used in this study was a questionnaire distributed to clients of PT. Toyotaka Mitra Indonesia as many as 95 respondents. The sampling method used was accidental sampling. The analytical method used in this research is multiple linear regression analysis using SPSS software application assistance. The results showed the quality of products, promotions and price together (simultaneously) significantly affect sales. Partially quality of products significantly influence sales with positive relationships, while sale prices and partially no significant influence on sales and promotions and price relationship is positive for sales.</em></p><p><em> </em></p><em>Keywords : quality of product, promotion, pricing, sales</em>
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Yan, Guangzhou, Yaodong Ni, and Xiangfeng Yang. "Optimal Pricing in Recycling and Remanufacturing in Uncertain Environments." Sustainability 12, no. 8 (April 15, 2020): 3199. http://dx.doi.org/10.3390/su12083199.
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With the increasing awareness of environmental protection, firms pay much more attention to the recycling and remanufacturing of used products. This paper addresses the problem of the optimal pricing in recycling and remanufacturing in uncertain environments. We consider two strategies of remanufacturing products, by which a recycled product can be repaired and sold as a second-hand product or dissembled into materials for production of new products according to its quality. As the market demand for products and the quantities of recycled products, such as fashion products and mobile phones, usually lack historical data, this paper adopts uncertainty theory to depict uncertainty in establishing the pricing model. An uncertain programming model and a series of crisp equivalent models are proposed under the assumptions of particular uncertainty distribution. Finally, numerical experiments are performed to show how various parameters influence the results of the proposed model.
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Tripathi, Avinash, and Neeraj Pandey. "Does impact of price endings differ for the non-green and green products? Role of product categories and price levels." Journal of Consumer Marketing 35, no. 2 (March 19, 2018): 143–56. http://dx.doi.org/10.1108/jcm-06-2016-1838.
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Purpose The discount image associated with odd-ending prices has led to its extensive use by retailers. The purpose of this study is to assess the impacts and applications of nine-ending vs round-ending prices on the purchase of green and non-green products at different price levels and under different purchase motivations. Design/methodology/approach Three experiments are conducted. The first experiment is a 2 (price ending: nine-ending vs round-ending) × 2 (product appeal: green vs non-green) between-subjects study; the second experiment is a 2 (price ending: nine-ending vs round-ending) × 2 (price level: low price vs high price) × 2 (product appeal: green vs non-green) between-subjects study; and the third experiment examined buyers’ preferences of price endings regarding the purchase of green products having either utility (utilitarian) or pleasure (hedonic) motivation. Findings This research highlights that consumers prefer zero-ending prices for green products and pleasure motivation products, but they prefer odd endings for low-priced and utilitarian products. These results support the increased reception of round-ending prices. Accordingly, this study contributes to the literature by providing a boundary condition for odd-ending prices. Specifically, the study finds that the effect of nine-ending prices becomes weaker as the price of the product increases. Practical implications The findings of this study have practical implications for managers, as the results indicate that pricing green products and high-quality perception products using round digits and pricing low-priced and utility perception products using odd digits will increase consumers’ purchase intentions. Moreover, pricing the products using round-ending prices will reduce the perception of low quality and deter brand loyalty emanating from a low-priced/discount image of a product. Originality/value This research contributes to theoretical and practical aspects of behavioural pricing literature. This research uncovers the buyers’ distinct preferences for zero-ending prices and odd-ending prices when purchasing different products based on different motivations and varied price levels. This is the first research of its kind to explore and compare the impact of psychological pricing on green products. The study also resolves a contradiction in past literature regarding the use of nine-ending prices by providing boundary conditions.
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Zhang, Qunxiang, Zuqing Huang, and Rong Zheng. "Risk-Averse Pricing Decisions Related to Recyclables’ Quality in a Closed-Loop Supply Chain." Mathematical Problems in Engineering 2021 (March 19, 2021): 1–16. http://dx.doi.org/10.1155/2021/6653325.
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In a closed-loop supply chain, uncertainty of recyclables’ quality is a major factor of supply chain members’ decision-making. Because of this uncertainty, manufacturers must pay varying manufacturing costs for remanufacturing recyclables. Our study assumed that manufacturers are risk-averse towards uncertainty in manufacturing costs and constructed a retailer recycling model and a third-party recycling model to investigate pricing decisions in a decentralized closed-loop supply chain under uncertainty about recyclables’ quality. Our findings can be summarized as follows: (1) the higher the degree of consumer preference for remanufactured products, the higher the wholesale and retail prices of remanufactured products and the higher the recycling price of used products; (2) the two recycling models showed a U-shaped relationship between supply chain revenue and the degree of consumer preference for remanufactured products, and this supply chain revenue is related to the consumer preference coefficient; (3) there is a U-shaped relationship between the retailer’s expected revenue and the degree of consumer preference for remanufactured products in the R mode and an M-shaped relationship between them in the 3P mode; (4) in both recycling modes, the manufacturer’s risk aversion is inversely proportional to supply chain revenue, and supply chain revenue in the R mode is higher than that in the 3P mode; and (5) the higher the uncertainty of recyclables’ quality, the lower the recycling price of used products and the lower the manufacturer’s enthusiasm for recycling or for used products.
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Ometsinska, Iryna, and Nataliia Pochynok. "Concern areas of pricing at domestic enterprises." Herald of Ternopil National Economic University, no. 3(85) (August 8, 2017): 75–86. http://dx.doi.org/10.35774/visnyk2017.03.075.
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The subject of study is theoretical and methodological principles of pricing at domestic enterprises. In the course of investigations general scientific and special methods of scientific knowledge were used, including generalization and systematization, induction and deduction, system approach, analogy. Economic nature of price was studied and offered to be considered as a monetary equivalent of a product unit (works and services), which shows the product’s value of utility and amount of money spent on buying or selling it. We also determined the factors that affect pricing and distinguished them by the following groups: internal and external factors, factors that are partially or totally controlled by the enterprise, factors that are out of control or the enterprise and factors reducing or increasing the price. The internal factors that are fully controlled by the enterprise include the cost of production (works, services), accounting policy of the enterprise, after-sales service and the use of limited resources, product quality, the brand and territorial placement. The external factors include demand for products, amounts of sales on the market, quality and price of the same products charged by the competitors, buyer’s focus on a high quality and low price, seasonality of demand, tax system, interest rate, price type, solvency of the population, state of country’s economy. The stages of the pricing process include certain internal and external impact factors, study of the state price policy, calculation of minimal and initial price of products by means of the return method based on the information formed within the accounting system. They also provide for calculating the product price by a variety of methods, setting price and analysis of the range of its change, control over the validity of the price and compliance with the law. We also determined the procedure for the costing methods to be implied. And finally, we outlined the basic problems leading to distortion of cost of products (works and services). They include a wrongly selected accounting policy, imperfectness and contradiction of normative legal acts, incorrect allocation of indirect costs, shadow costs available and unjustified overcharge.
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Folwell, R. J., V. A. McCracken, J. R. Ellis, S. Spayd, and J. Yarnell. "Pricing of raw agricultural products by quality attributes: Case study of Concord grapes." Agribusiness 6, no. 5 (September 1990): 475–88. http://dx.doi.org/10.1002/1520-6297(199009)6:5<475::aid-agr2720060506>3.0.co;2-2.
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KYRYLIUK, Iryna, and Yevhenii KYRYLIUK. "PRINCIPLES AND METHODS OF PRICING FOR HIGH QUALITY ANIMAL PRODUCTS IN MODERN CONDITIONS." CHERKASY UNIVERSITY BULLETIN: ECONOMICS SCIENCES, no. 1 (2020): 144–54. http://dx.doi.org/10.31651/2076-5843-2020-1-144-154.
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Raza, Syed Asif. "Optimal decisions on fencing, pricing, and selection of process mean in imperfectly segmented markets." RAIRO - Operations Research 54, no. 6 (September 16, 2020): 1573–92. http://dx.doi.org/10.1051/ro/2019115.
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This paper integrates the selection of a process mean, production and marketing decisions at a firm’s level. We discussed a manufacturing firm’s problem that integrates its manufacturing decisions on production quantities and selection of a process mean with marketing decisions. The marketing decisions include setting prices, and the fencing investment to mitigate the effect of demand leakages between market segments. The manufacturing firm yields products of varied quality based on a single quality characteristic (e.g., amount of fill). The firm operates in a monopoly, and manufacturing process is assumed to follow a normal distribution, and therefore, it produces multi-grade (class) products distinct in their single quality characteristic. Depending upon the quality characteristic, a product with quality characteristic equal to greater than the upper specification limit is classified as grade 1 product, and sold in primary market at a full price. When the quality characteristic falls between the lower and the upper specification limits, it is referred to as a grade 2 product, and sold in a secondary market at a discounted price. Any product with a quality characteristic lower than the lower specification limit is reworked at an additional cost. A 100% error-free inspection is conducted to segregate the products at a negligible cost. Unlike many related studies in literature, this research proposes a novel integration of the pricing and production quantity decisions along with the process targeting in the two markets with pricing decision in the presence of demand leakages due to cross-elasticity. Furthermore, it is assumed that the firm can mitigate the demand leakage at an additional investment on improving fencing. Thus, the firm’s optimal decision would also include the pricing in each market segment, and fencing investment along with its decision on the production quantity for each product class. Mathematical models are developed to address this problem assuming the price-dependent stochastic demand. Structural properties of these models are explored and efficient heuristic solution methodologies are developed. Later, we also developed models when the stochastic demand information is only partially known, and proposed Harmony Search algorithm on the problem. Numerical experimentation is reported to highlight the importance of the proposed integrated framework and the impact of the problem related parameters on a firm’s profitability and its integrated optimal control decisions on selection of a process mean, pricing, production quantity, and fencing investment.
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Shui, Wenbing, and Mengxia Li. "Integrated Pricing and Distribution Planning for Community Group Purchase of Fresh Agricultural Products." Scientific Programming 2020 (July 22, 2020): 1–15. http://dx.doi.org/10.1155/2020/8839398.
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As a new social e-commerce model, community group purchase of fresh agricultural products has been gradually welcomed by the public. However, its development and operation still face homogeneous competition problems. In order to enhance competitive advantages of operators, this paper proposes a collaborative optimization mechanism, including a new pricing model and a new cold chain vehicle route planning model. It aims to ensure the quality of fresh products, reduce logistics costs, and improve enterprise profitability. The model takes into account not only the quality of fresh products and their impact on price and demand but also the impact of quality changes on total distribution costs. A two-layer programming method is applied to realize the collaborative optimization mechanism, and then the upper and lower models are solved by mathematical derivation, proof methods, and optimization procedures, respectively. Finally, the feasibility and effectiveness of the model are verified by combining with specific examples, and the following conclusions are obtained: price, delivery quality, and total profit increase with the increase of potential market demand rate. The lower the refrigeration temperature of the vehicle we choose within a certain range, the higher the quality can be obtained. In order to obtain the highest profit, community group purchase operators can choose a higher distribution temperature on the premise that they can guarantee that the quality of fresh agricultural products can be at an appropriate level.
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Dudar, Volodymyr. "Building pricing strategies for enterprises of the organic sector with a view to pursue marketing goals." Herald of Ternopil National Economic University, no. 2(88) (June 6, 2018): 45–54. http://dx.doi.org/10.35774/visnyk2018.02.045.
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The paper reveals the essence of price in the market system and the role of pricing / marketing strategies in organic agricultural production. It is pointed out that a price is a key measure of social spending, because it manages the economy through the redistribution of values between economic entities. It is also noted that the dynamics of price movements in the organic sector relates to changes in quality and volume of production, promotion on the market, consumer solvency, product-consumption level, inventory levels and the overall economic situation of enterprises. The research paper presents an analysis of factors and competitive pricing strategies that affect prices of organic agro-food products. Competitive pricing strategies in the price management system are derived on the basis of two criteria: competitive advantages based on price and non-price factors, and the volume of the target market. It is found that in setting prices of organic agro-food products, both internal and external factors should be taken into account. Internal factors include cost price, innovativeness and uniqueness of production, life-cycle stage, and simultaneity between prices and expectations of buyers. External factors are price sensitivity of buyers, price levels of competitors, and macroeconomic conditions, such as inflation, taxes, excise duties, state price policy. Concerning price-quality indicators, a model of marketing strategy for organic agro industrial enterprises is suggested. A certified organic business that holds a leading position in the market often has to pursue a strategy of high quality in which high prices are motivated by quality and safety of organic products. It is concluded that pricing in the organic agro-food market is determined by high cost of production, and high quality and specific product properties play a crucial role for consumers.
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Verma, D. P. S., and Soma Sen Gupta. "Does Higher Price Signal Better Quality?" Vikalpa: The Journal for Decision Makers 29, no. 2 (April 2004): 67–78. http://dx.doi.org/10.1177/0256090920040206.
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With differentiated products, consumers may not be aware of the quality and features of the products they buy. They are often unable to make a quality comparison among various brands. Moreover, they often gather little information even when the financial commitment involved is substantial. A popular belief is: ‘You get what you pay for.’ Therefore, consumers tend to believe that high price is an indicator of better quality. Although many studies conducted on price-quality relationship have supported this belief, there are other studies that have found the relationship to be product-specific and weak in general. This study seeks to examine the relationship between the price of the product and the buyers' perception of quality in respect of durable, semi-durable, and non-durable products in the Indian context. Three products were selected for the purpose of the study: colour television as a durable product; T-shirt as a semi-durable product; and toothpaste as a non-durable product. Data were collected from the primary sources with the help of a non-disguised, pre-structured questionnaire. In particular, the authors sought to explore answer to two questions: (1) Does high price have a positive influence on the buyers' perception of product quality? (2) Is there a significant difference in the buyers' perception of the quality of products falling in different price ranges? The major findings of the study are as follows: For a durable product, like colour television, setting the price too low will negatively affect the quality image of the product and the consumer would be reluctant to buy a low-priced brand as it might lower his image in the society. Pricing it reasonably high will give the product a high-quality image. However, the marketer should take care of the competitors' pricing policies and the buyers' purchasing power. The target market for T-shirt in India consists mainly of the young, especially the college students, having limited purchasing power. They prefer local, or little known, but trendy brands of T-shirts rather than expensive ones. Also, they would opt for a T-shirt of a reputed brand if it is within their purchasing power. However, reducing the price of the T-shirt may dilute its brand image. Hence, the marketer of the T-shirt should think of market segmentation strategies and select the appropriate target segment(s) and price the product accordingly. For toothpaste, brand reputation is a critical factor and the marketer should price the product according to the reputation enjoyed by the brand. However, the price-quality relationship for this product has been found to be weak in comparison to colour television and T-shirt. The marketer, therefore, should be wary of charging a very low price as it would create an inferior quality image in the mind of the buyer. The findings have important marketing implications for pricing, market segmentation, target marketing, and product positioning.
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Kippen, Laura Sue, and W. Timothy Rhodus. "Does Quality Pay?" HortScience 30, no. 4 (July 1995): 761A—761. http://dx.doi.org/10.21273/hortsci.30.4.761a.
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Quality is extremely important to the processors of horticultural and agricultural commodities. It is important from the standpoint of producing high-quality end-products as well as resulting in lower costs and higher profits. However, producers of commodities receive few benefits from the production of higher quality for several reasons. One important reason is that producers lack information about the qualities processors require. In addition, producers are uninformed of the end-user quality their crops manifest. Presently, little incentive exists for producers to improve quality, other than that provided by USDA Grades and Standards. Using experimental economics, empirical evidence is provided demonstrating that increased awareness of crop quality requirements of processors by producers influences market efficiency, pricing efficiency, and crop quality management strategies of producers.
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Elaad, Eitan, Neta Sayag, and Aliya Ezer. "Effects of Anchoring and Adjustment in the Evaluation of Product Pricing." Psychological Reports 107, no. 1 (August 2010): 58–60. http://dx.doi.org/10.2466/01.pr0.107.4.58-60.
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Anchoring and adjustment comprise a heuristic that creates expectations. Two types of anchors were applied on participants' evaluation of products: the price reference of the product (maximum, minimum, or no price reference) and the context in which the products were evaluated (the prestige of the shopping center). Results showed that both factors anchored evaluations of products' value. Context effects were explained by the different expectations of visitors in prestigious (looking for quality) and less prestigious (seeking a bargain) centers.
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Jian, Jie, Huipeng Li, Nian Zhang, and Jiafu Su. "Supply Chain Decision-Making and Coordination considering Anticipated Regret under Price Discount." Complexity 2020 (July 24, 2020): 1–14. http://dx.doi.org/10.1155/2020/6091702.
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The increasing homogeneous product market has made more competition among companies to focus on improving customers’ experience. In order to get more competitive advantages, companies often launch discount products to attract consumers. However, stimulated by discount products, the perception of anticipated regret is becoming stronger, which is an inevitable issue in front of companies with price discount strategy. Considering the impact of anticipated regret for discount products, this paper quantitatively describes the utility functions and deduces the demand functions of original price products and discount products. The theoretical analysis and numerical simulation are used to analyze centralized and decentralized models of supply chain for discount products. On its basis, the revenue-sharing contract is designed to optimize the profits of supply chain. This paper finds that the price of products increases first and then decreases with the increase of regret sensitivity coefficient and consumer heterogeneity. When the regret sensitivity coefficient and consumer heterogeneity are lower, companies in the supply chain can adopt the “skimming pricing” strategy in order to obtain more profits. When the regret sensitivity coefficient and consumer heterogeneity increase, companies in the supply chain can adopt “penetrating pricing” strategies to stimulate market demand. For high regret consumers, manufacturers can adopt a “commitment advertising” strategy to promise price and quality, and retailers can adopt a “prestige pricing” strategy to reduce consumer perception of regret. In response to products with higher differences in consumer acceptance, manufacturers can adopt a “differentiated customization” strategy to meet different types of consumer demand and retailers can adopt a “differential pricing” strategy for precise marketing.
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Qiu, Chun, and Peter Popkowski Leszczyc. "Send-for-review decisions, brand equity, and pricing." European Journal of Marketing 50, no. 1/2 (February 8, 2016): 145–65. http://dx.doi.org/10.1108/ejm-11-2014-0708.
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Purpose – The purpose of this paper is to study firms’ decisions of voluntary disclosure of high product quality by sending their products to intermediaries for review, and how the nature of the reviews subsequently substitutes the brand names in terms of affecting the price of the product. Design/methodology/approach – Using data on camcorders and point & shoot digital cameras collected from multiple intermediary sources, this paper empirically tests the relationships among brand equity, send for review decisions, the nature of reviews and pricing, controlling for endogeneity. Findings – This paper finds that firms are likely to send their high-quality products to the intermediaries for review, but such likelihood varies across different brands. Relatively weak brands are more likely to send their products for review than relatively strong brands. By doing so, weak brands receive two benefits: first, intermediary reviews help eliminate price differentials between weak brands and strong brands. The more positive is the review, the higher is the price. When intermediary reviews are not obtained, some strong brands effectively charge a price premium over weak brands. Second, intermediary reviews subsequently attract more consumer word of mouth (WOM). The more positive is the review, the more consumer WOM is attracted. Researchlimitations/implications – One limitation is that this paper does not account for the influence of intra-brand competition. The second limitation is related to the assumption that intermediary reviews are accurate. Practicalimplications – This paper offers managerial implications to brand managers concerning send-for-review and pricing decisions. It proposes how managers leverage third-party endorsement in launching a new product. Originality/value – This paper is one of the few papers empirically studying the interaction of two communication approaches: disclosure and brand signaling. It modifies the commonly assumed relationships among brand, quality and price by demonstrating the substitute effect of intermediary reviews and brand names on price. This paper is also the first research that empirically examines the impact of firms’ “send-for-review” decisions on generating consumer WOM. Managerially, this paper substantiates Godes et al.’s (2005) framework on how firms should manage social interactions upon the release of new products.
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Ma, Peiqi. "Ordering and Pricing Strategies for Fresh Products with Multiple Quality Levels Considering Consumer Utility." American Journal of Operations Research 05, no. 03 (2015): 192–98. http://dx.doi.org/10.4236/ajor.2015.53015.
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Xiong, Yu, Gendao Li, Yu Zhou, Kiran Fernandes, Richard Harrison, and Zhongkai Xiong. "Dynamic pricing models for used products in remanufacturing with lost-sales and uncertain quality." International Journal of Production Economics 147 (January 2014): 678–88. http://dx.doi.org/10.1016/j.ijpe.2013.04.025.
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Polkinghorne, R., J. Philpott, A. Gee, A. Doljanin, and J. Innes. "Development of a commercial system to apply the Meat Standards Australia grading model to optimise the return on eating quality in a beef supply chain." Australian Journal of Experimental Agriculture 48, no. 11 (2008): 1451. http://dx.doi.org/10.1071/ea05181.
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A major trial was conducted to develop, test and demonstrate the application of Meat Standards Australia (MSA) research findings in a beef retailing environment. A new concept retail store was established whereby a mix of raw beef products and pre-cooked meals were merchandised under an eating quality grade defined by MSA palatability scores. Products were presented fully prepared within cooking method with pricing based on the predicted cooked results. Large price differentials were established between the three grades offered, with 5-star product priced at more than double the 3-star product. The principle of pricing being directly related to eating quality was extended from the retail store sales to fabrication and the purchase of source cattle from producers. This encouraged considerable innovation to optimise eating quality and returns, demonstrating the potential for truly transparent value-based pricing systems to achieve change. Novel systems were developed to break down and fabricate the carcass into ‘retail-ready’ product with extensive software development to trace the eating quality, value and location of individual cuts and products. Detailed feedback provided the producer with an accurate measure of value and sufficient data to evaluate possible alternative production strategies. Results at each level of the supply chain were encouraging with compound annual growth in sales exceeding 12% at retail level and continued innovation through fabrication and on-farm areas combining to improve eating quality and financial outcomes. It was demonstrated that the consumer focus delivered by MSA grades could be applied at a commercial level providing an opportunity to reposition beef as a contemporary consumer product and to implement a value-based system across all sectors.
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Zhou, Liangchuan, and Surendra Gupta. "A Pricing and Acquisition Strategy for New and Remanufactured High-Technology Products." Logistics 3, no. 1 (February 21, 2019): 8. http://dx.doi.org/10.3390/logistics3010008.
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New generations of high-technology products are frequently launched before the previous model is sold out. Customers have an incentive to end the use of their old product and purchase a new one with the latest technological innovations. The unsold old models become less attractive, while the supply of remanufactured products from end-of-use products is uncertain in time, quantity, and quality. Other than adjusting the price, upgrading the returning unsold new products may be a source of remedy. This study provides profit maximization models associated with customer choice demand functions based on manufacturer, retailer, and joint supply chain scenarios. Two acquisition strategies are compared: acquire end-of-use products only and collect both end-of-use products and unsold old-style new products. The results reveal that returning the optimal quantity of overstocked new products brings about a greater benefit in all scenarios. Compared to the remanufacturer, the retailer is the optimal undertaker for collecting used products. In addition to this, slow technological development of the new-generation model causes a decrease in profit for the manufacturer. The optimal quantity of new products to be bought back decreases, because both the manufacturer and the retailer prefer to promote unsold outmoded products rather than upgrade the used products.
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Adams, Charles F. "An Undergraduate Primer on Quality-Differentiated Demand." American Economist 65, no. 2 (January 12, 2020): 277–83. http://dx.doi.org/10.1177/0569434519899354.
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This article presents a student exercise on the logic underlying demand for quality-differentiated products. The argument builds and extends on basic constructs from undergraduate microeconomics, developing a linear demand structure to reflect consumer preferences for quality variation and a brief critique of market responses to those preferences that indicates potentially greater efficiency loses under monopoly once the possibility of quality distortions are accounted for. Various policy extensions are noted. These include applications in utility pricing tied to quality variations in service reliability, the potentially disproportionate impact on lower income households of quality distortions created by monopoly practices, and the potential of profligate resource use by monopolies which are shown to favor higher over lower quality products. Following along with the student exercise is a series of instructor notes with references to the scholarly literature and possible elaborations on various aspects of the exercise that instructors may chose to address. JEL Classifications: D4, D41, D42
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Miahkykh, Iryna M., Mariana S. Shkoda, and Oleksandr М. Peresypko. "ENHANCING THE ENTERPRISE PRICING STRATEGY MANAGEMENT." Bulletin of the Kyiv National University of Technologies and Design. Series: Economic sciences 137, no. 4 (December 5, 2019): 95–103. http://dx.doi.org/10.30857/2413-0117.2019.4.9.
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The fundamental objectives of this study is to provide insights to the “pricing policy” concept, to explore the factors that affect pricing of commercial products, as well as to develop recommendations to enhance the company's strategic management in the area of its pricing policy. To attain the above objectives, the following research methods have been employed: system analysis and logical generalization – to improve the framework for the enterprise pricing strategy management optimization; a substrate approach – to justify and group the internal and external factors affecting the pricing policy. It is noted that while estimating the price for products, the company seeks to obtain the desired profit, both in the short run, and for the future, in the long term to ensure their competitiveness. Thus, within a pricing policy it is critical to maintain the permanent process of selection and comparison of an acceptable ratio between the product output and its price subject to the market. However, mere competitors’ price monitoring or price comparing and adjustments, are not yet sufficient for achieving business success. While shaping the pricing policies and adjusting prices, a company should focus on consumer purchasing power, since the market factor plays a key role in pricing. Moreover, for many enterprises price is the major tool for managing supply and demand. It is also very important that these methods are applied synchronously, which will enable the company to set relevant prices and make products competitive through pricing quality management policies. Since the cost accounting method refers to the costs associated with product manufacturing and sales, respectively, the target costs are recorded, whereas the market approach facilitates businesses to assess the current situation in the market. In the strategy of managing pricing policies, it is necessary to seeing the importance of the relationship and correlation between the sales strategy and the marketing concept of the enterprise. Another significant finding of the study in the context of pricing strategy management is the need to consider the relationships and correlation between a sales strategy and the company marketing concept. Thus, while designing pricing strategies, first of all, it is critical to focus on setting the relevant price level that will contribute to maximizing the total company profit under limitrophe regulation of its business activities in a competitive environment, as well as to develop the optimal pricing policy and select a particular management strategy in line with specific company goals and activities.
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Qiu, Ying, Yitong Ma, and Xianliang Shi. "PRICING, QUALITY LEVEL AND GREENING DECISIONS FOR GREEN AND NON-GREEN PRODUCTS WITH GOVERNMENT INTERVENTIONS." Environmental Engineering and Management Journal 19, no. 8 (2020): 1379–87. http://dx.doi.org/10.30638/eemj.2020.128.
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Sun, Ching-Jen. "Dynamic Price Discrimination with Customer Recognition." B.E. Journal of Theoretical Economics 14, no. 1 (January 1, 2014): 217–50. http://dx.doi.org/10.1515/bejte-2013-0048.
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AbstractThis paper studies a general two-period model of product line pricing with customer recognition. Specifically, we consider a monopolist who can sell vertically differentiated products over two periods to heterogeneous consumers. Each consumer demands one unit of the product in each period. In the second period, the monopolist can condition the price–quality offers on the observed purchasing behavior in the first period. In this setup, the monopolist can price discriminate consumers in two dimensions: by quality as well as by purchase history. We fully characterize the monopolist’s optimal pricing strategy when there are two types of consumers. When the type space is a continuum, we show that there is no fully separating equilibrium, and some properties of the optimal contracts (price–quality pairs) are characterized within the class of partitional perfect Bayesian equilibria.
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Bonatti, Alessandro. "Menu Pricing and Learning." American Economic Journal: Microeconomics 3, no. 3 (August 1, 2011): 124–63. http://dx.doi.org/10.1257/mic.3.3.124.
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We analyze the design of dynamic menus to sell experience goods. The quality of the product is initially unknown, and the total quantity sold in each period determines the amount of information in the market. We characterize the optimum menu as a function of consumers' beliefs, and the dynamic adjustments resulting from the diffusion of information. The firm faces a dynamic trade-off between gains from trade, information production, and information rents. It initially charges lower prices, sacrificing short-term revenue to increase sales. As more information is revealed, prices increase, and low-valuation buyers are excluded, even when the product's quality is high. (JEL D42, D82, D83, L12)
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Widodo, Erwin, Rahaditya Dimas Prihadianto, and Dody Hartanto. "Multi period pricing for managing local fruit supply chain." MATEC Web of Conferences 154 (2018): 01049. http://dx.doi.org/10.1051/matecconf/201815401049.
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Recently fresh fruit sector is grown not only due to increasing of demand that spirited by healthy lifestyle but also requirement of quality food should be eaten daily. Its complexity make many research considered fruit in certain supply chain, called as Fruit Supply Chain (FSC). In FSC, customers tend to purchase products with a longer remaining lifetime and avoid the ones which give aging signal. Customer willingness to pay decreases once the product start to be deteriorated, which may cause slower demand for aging fruits. Consequently, retailers should enable discounted price for aging fruits products to retain or improve demand rate. Main purpose of this research is explaining how to maximize supply chain profit by applying dynamic pricing. A set of mathematical model is optimized on this research. It addresses dynamic pricing for FSC players to achieve better profitability. The result proves that dynamic pricing is urgent to be done which is signaled by increment of FSC Profit. FSC players can separate selling period into three periods, which are forward buying period, normal price period, and markdown price period as implementation of this scheme.
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Belegante, Christian Geovane, Karen De Lima Gomes, Gleici Da Silva Brustolom, and Edgar De Souza Pandolfi. "Estratégias de precificação." Revista Científica FAEMA 8, no. 1 (July 9, 2017): 175. http://dx.doi.org/10.31072/rcf.v8i1.468.
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O presente trabalho resulta da análise da produção cientifica publicada em português, sobre as principais estratégias de precificação de produtos e serviços e a utilização destes conceitos em práticas de mercado. O objetivo deste artigo é identificar como está organizada a teoria presente nas publicações em português de precificação de produtos e serviços, evidenciando as abordagens teóricas sobre a determinação de preços e sua utilização nas estratégias de precificação baseadas na demanda, na concorrência, na precificação premium e em novos produtos. Foi utilizada a revisão da literatura com base em um período temporal para análise de artigos publicados em journals, compreendido entre 2000 e 2016. O critério de seleção dos artigos apoiou-se na pertinência temática do problema de pesquisa e parâmetros de exclusão, que levaram a escolha de 48 publicações utilizadas para análise. Com a revisão, concluiu-se que os fatores: preço, qualidade, demanda, receptividade dos consumidores ao produto e a influência que o preço possui sobre a percepção da qualidade influenciam diretamente no valor percebido pelo cliente e deve ser utilizado como base para a adoção de uma estratégia de precificação que maximize a performance organizacional. Como indicação para futuras pesquisas, sugere-se um mapeamento do comportamento do consumidor sob as diferentes técnicas de precificação e uma análise do impacto do preço sobre a percepção de qualidade na perspectiva do consumidor.
ABSTRACT: The present work results from the analysis of scientific production in portuguese, on the main strategies of pricing of products and services and use of concepts in market practices. The objective of this article is to identify how the theory is organized in the Portuguese publications of pricing of products and services, showing the theoretical approaches on pricing and its use in pricing strategies based on demand, competition, premium pricing and In new products. The literature review was used based on a temporal period for the analysis of articles published in journals, between 2000 and 2016. The selection criterion of the articles was based on the thematic relevance of the research problem and exclusion parameters, which led to the choice of 48 publications used for analysis. With the review, it was concluded that the factors: price, quality, demand, consumer receptivity to the product and the influence that the price has on the perception of quality directly influence the value perceived by the customer and should be used as the basis for the adoption Of a pricing strategy that maximizes organizational performance. As an indication for future research, it is suggested a mapping of consumer behavior under different pricing techniques and an analysis of the impact of price on the perception of quality from a consumer perspective.
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Xu, Qingyun, Bing Xu, Ping Wang, and Yi He. "Bundling strategies for complementary products in a horizontal supply chain." Kybernetes 47, no. 6 (June 4, 2018): 1158–77. http://dx.doi.org/10.1108/k-02-2017-0082.
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Purpose This paper aims to address the following problems: What are the firms’ optimal pricing and quality policies under three scenarios (no bundling, pure bundling and mixed bundling)? In what condition will one bundling strategy dominate the others? How does the degree of complementarity affect the firms’ decision? Design/methodology/approach Using the game theory, this study first establishes three models of bundling strategies: no bundling, pure bundling and mixed bundling and then obtains the optimal prices and quality decisions. This study uses numerical analysis to explore the relationships between the prices (demands and profits) and some key parameters and to obtain some valuable management complications. Findings Some interesting and valuable management implications are established: regardless of the degree of complementarity, adopting a pure bundling or mixed bundling strategy is better than separately selling an individual product; a high degree of complementarity leads to reduced profit in the no bundling and mixed bundling scenarios, whereas the condition in the pure bundling strategy is the opposite; and when the degree of complementarity is adequately large, choosing pure bundling strategy is more profitable. Research limitations/implications On the one hand, this study does not calculate the profit sharing ratio, and hence, the equilibrium profit sharing ratio can be explored in future work. On the other hand, marketing efforts (e.g. advertising and promotion) can be included in the study. Practical implications This study derives the necessary conditions for the most effective bundling strategy that maximizes firm’s profits, and these conclusions can provide a decision reference to the bundling decisions of firms. Originality/value First, the optimal bundling strategies in a horizontal supply chain consisting of two firms is considered. Under the pure and mixed bundling strategies, the two firms sell the bundled product by building a cooperative program. Second, both the pricing policies and quality decisions of supply chain members under the different bundling strategies are studied.
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Pilone, Vittoria, Antonio Stasi, and Antonio Baselice. "Quality preferences and pricing of fresh-cut salads in Italy: new evidence from market data." British Food Journal 119, no. 7 (July 3, 2017): 1473–86. http://dx.doi.org/10.1108/bfj-09-2016-0419.
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Purpose In Europe fresh-cut fruit and vegetables, is one of the major growing segments in agro-food sector. Current literature reports a limited number of studies about consumers’ preferences towards these products. In particular, it lacks of studies focussed on fresh-cut salads and based on market data. In this paper, a study on consumer preferences towards the main attributes of Italian fresh-cut salads is proposed. More specifically the investigation is focussed on attributes assessable by consumers before purchase such as assortment, tenderness, product preparation and vegetable variety together with brand, size and type of packaging, presence of organic certification, promotion and product price. The purpose of this paper is to evaluate how much Italian consumers pay for those attributes with the aim to understand how much profitable could be different strategies in the sector. Design/methodology/approach The analysis is based on IRI-Infoscan scanner data, consisting of 881 fresh-cut products. The impact of each attributes on pricing is measured by means of a hedonic price model. Findings Main results show that, in Italy, fresh-cut salad price is greatly affected by tenderness, product preparation, assortment, brand, presence of organic certification, packaging attributes and vegetable variety. Practical implications Findings offer to producers the possibility to set up products by composing the mix of attributes that gives back the highest price. In addition, they provide some insights to define manufacturer’s strategies. Originality/value This paper represents a novelty in economic literature because it can be considered an example of consumer preferences analysis towards the different attributes of fresh-cut vegetables based on real market data.
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Zhou, Qin, and Kum Fai Yuen. "Analyzing the Effect of Government Subsidy on the Development of the Remanufacturing Industry." International Journal of Environmental Research and Public Health 17, no. 10 (May 19, 2020): 3550. http://dx.doi.org/10.3390/ijerph17103550.
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Remanufacturing plays an important role in a circular economy, by shifting supply chains from linear to closed loop. However, the development of the remanufacturing industry faces many challenges. Consumers’ uncertainty about the quality of remanufactured products can hamper their decision to make a purchase (i.e., uncertainty behavior). Such uncertainty can be reduced when they learn that more consumers are purchasing remanufactured products (i.e., network externality behavior). Considering the aforementioned behaviors, this paper investigates how a government could set the optimal subsidy level to maximize the sales quantity of remanufactured products with a limited budget. We modeled a Stackelberg game between the government and an original equipment manufacturer, under two settings, over two periods. Setting 1 only considers an original equipment manufacturer that produces remanufactured products, and Setting 2 considers an original equipment manufacturer that produces both new and remanufactured products. We show that the original equipment manufacturer should adjust its pricing strategy (i.e., markup vs. markdown) according to the subsidy levels. Our analysis on the government budget constraint shows that an original equipment manufacturer earns more profits in Setting 1 than Setting 2, only when the budget constraint is high, and less profits when budget constraint is low.
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El-Bakry, L. "The Future of Biosimilars." International Journal of Drug Delivery 9, no. 1 (June 21, 2017): 01. http://dx.doi.org/10.5138/09750215.1930.
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<p>Biosimilars are to Biologic products what generic drugs are to chemical products, a more affordable solution to the increasing drug pricing without sacrificing the quality of the treatment.There is much debate in the health care industry as to whether Biosimilars will deliver on the same success achieved by the generic products, which can amount to up to 80% in some cases. It is my view though that Biosimilars provide a viable path to cost reduction, quality improvement and affordable accessibility to medication. In fact, the introduction of lower costs Biologics as intended by the Biosimilar market will force competition within the therapeutics treatment market that will both exertpricing pressure as well as inspire innovation in the entire ecosystem. </p>
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Chukurna, Olena. "Methodical Approach to Accounting Intangible Assets and Brand Values in Marketing Pricing." Marketing and Digital Technologies 4, no. 3 (September 25, 2020): 63–72. http://dx.doi.org/10.15276/mdt.4.3.2020.7.
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The article presents a methodological approach to the valuation of intangible assets and brand value in marketing pricing policy. This approach takes into account the specifics of the formation of intangible assets and sources of brand value in the B2B markets. It was proposed a modified ROI (Return on Investment) to assess the effectiveness of the brand promotion system as an intangible asset. It was proved the interrelation of an estimation of efficiency of marketing activity with pricing on the basis of the complex account of quantitative and qualitative characteristics of the goods. With the help of the BEST-marketing program, the most important quality characteristics of engineering products in the B2B market have been identified. Keywords: marketing pricing, brand valuation, intangible assets, B2B market, machine-building industry.
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Azadeh, Ali, Hassan Songhori, and Nima Salehi. "A unique optimization model for deterministic bundle pricing of two products with limited stock." International Journal of System Assurance Engineering and Management 8, S2 (February 18, 2017): 1154–60. http://dx.doi.org/10.1007/s13198-017-0581-0.
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Slapø, Helena, Alexander Schjøll, Børge Strømgren, Ingunn Sandaker, and Samira Lekhal. "Efficiency of In-Store Interventions to Impact Customers to Purchase Healthier Food and Beverage Products in Real-Life Grocery Stores: A Systematic Review and Meta-Analysis." Foods 10, no. 5 (April 22, 2021): 922. http://dx.doi.org/10.3390/foods10050922.
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Grocery stores are important settings to promote healthier food and beverage choices. The present paper aims at reviewing the effectiveness of different types of in-store interventions and how they impact sales of different product category in real grocery stores. Systematic search was conducted in six databases. In-store interventions were categorized according to the framework by Kraak et al. (2017) into one or more of eight interventions (e.g., place, profile, portion, pricing, promotion, healthy default picks, prompting and proximity). This systematic theme-based review follows the preferred reporting items for systematic reviews and meta-analyses (PRISMA) data screening and selection. Thirty-six studies were included in the qualitative synthesis and 30 studies were included in the meta-analysis, representing 72 combinations of in-store interventions. The analysis demonstrates that interventions overall had small significant effect size (ES) using Cohen’s d on food purchase behavior (d = 0.17, 95% CI [0.04, 0.09]), with largest ES for pricing (d = 0.21) and targeting fruits and vegetables (d = 0.28). Analysis of ES of in-store interventions show that pricing, and pricing combined with promotion and prompting, effectively impacted purchase behavior. Interventions significantly impacted both sales of healthy and unhealthy products and significantly increased sales of fruits and vegetables, healthy beverage and total volume of healthy products. Results should however be interpreted with some caution, given the relatively low quality of overall evidence and low number of studies and observations for some types of intervention. Further research exploring impact on different in-store interventions and targeting especially unhealthy products are needed.
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Gryzunova, Natalia, Igor Keri, Darina Sizova, and Tatyana Sizova. "Price Drivers of Economic Growth in the Southern Region of Russia." Regionalnaya ekonomika. Yug Rossii, no. 4 (December 2020): 125–36. http://dx.doi.org/10.15688/re.volsu.2020.4.11.
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The purpose of this article is to reveal the relationship of the effectiveness of pricing policy and spatial economics. The main emphasis is on export pricing models. International trade contributes to the accumulation of political, social and financial power, forming new shopping centers and unions, aligning prices and profitability. International exchange of strategic resources often has the goal of changing the political landscape and financial and trade practices. Oil and crops are used by leading exporting countries as a tool for political pressure and different kinds of preferences. At the same time, it can be argued that prices for certain strategic commodities in the world market are capable of solving a number of global and national issues. For example, market pricing of oil and oil products is gradually changing the world’s monetary system. Currently, future strategic commodities such as grain, sugar and cotton begin to replace oil. These traditional products of the South of Russia provide a significant share of the revenues of the state budget. However, the investment potential of the companies that produce these resources is extremely low. It is necessary to develop an organizational pricing strategy for the expansion of the product range of companies in the southern region in the MICEX list. Optimal pricing can quantitatively change not only GDP growth of both the global and national economies, but also to change the quality of life and management. Pricing methods (regression, parametric technique, specific indices) and pricing mechanisms (administrative and tax approach, for example) chosen by the company are dynamic market instruments for a strong commodity market, for the redistribution of investment flows, and income for the creation of sources of additional investment on the basis of shareholding.
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Wolak-Tuzimek, Anna, Elżbieta Noworol-Luft, and Radosław Luft. "Competitiveness of Enterprises in Polish SME Sector." Transport and Communications 2, no. 2 (2014): 17–20. http://dx.doi.org/10.26552/tac.c.2014.2.4.
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Growth factors of competitiveness are presented empirically. Conditions of competitiveness are determined by internal factors, dependent on enterprises themselves, and by a wide range of internal factors, dependent on the macroeconomic environment. Analysis of statistics concerning 2004-2011, collected as part of the author's research, leads to the conclusion that enterprises gain competitive advantage by low pricing and high quality of their products. A growing importance of quality as a factor determining enterprise competitiveness can also be noted.
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Shin, Hyun, Jongtae Shin, Shijin Yoo, Joon Song, and Alex Kim. "Strategic delegation, quality competition, and new product profitability." Management Decision 53, no. 3 (April 20, 2015): 713–29. http://dx.doi.org/10.1108/md-05-2014-0318.
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Purpose – The purpose of this paper is to present a new perspective on the marketing-R & D interface by modelling firms that develop new products in a duopolistic market. Design/methodology/approach – By using a game-theoretic modelling approach, this study examines strategic delegation, through which the marketing and R & D managers of each firm are given authority over pricing and new products’ quality levels. Findings – Interestingly, the study finds that the case where two managers with conflicting incentives negotiate (the horizontal coordination case) might produce a better financial outcome than when the managers’ decisions are perfectly coordinated by a profit-maximizing CEO (the vertical control case). In addition, the study identifies several conditions that guarantee horizontal coordination’s generation of higher profit, such as high (or low) sensitivity to the quality (or price) of a new product. The paper further shows that two competing firms may select horizontal coordination as a Nash equilibrium. Practical implications – These findings provide new insights into the role of marketing-R & D interaction under strategic delegation, which may allow rival firms to “spend smart” on R & D, avoid excessive (and unnecessary) quality competition, and thus enhance the profitability of new products. Such insights would be useful for any firms under budget constraints. Originality/value – To the authors’ knowledge, this paper represents the first attempt to analyze how delegation interacts with the conflicting incentives of marketing and R & D managers, which in turn affects the quality investment decisions, competitive intensity, and, ultimately, the financial outcomes of new products developed competing firms.
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Dementiev, Viktor E., Sergey G. Evsukov, and Elena V. Ustyuzhanina. "COMPARATIVE ANALYSIS OF STRATEGIES OF PRICING AND PROMOTION OF PRODUCTS AND SERVICES ON NETWORK VALUES MARKET." Vestnik of the Plekhanov Russian University of Economics, no. 3 (June 30, 2019): 152–66. http://dx.doi.org/10.21686/2413-2829-2019-3-152-166.
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The article studies conditions of dynamic pricing and marketing policy efficiency on network values market in circumstances of temporary supplier’s monopoly. The research method is economic-mathematic modeling of value cost dependence on the number of its consumers and demand for the value on price. By computer tests possibilities to use dynamic pricing for resolving three objectives are analyzed, they are maximization of net integral discounted profit of network value supplier; minimization of time necessary to reach the project repayment and minimization of time necessary to reach the maximum integral profit. The authors come to the conclusion about the importance of taking into account the peculiarities of network values markets for developing business marketing policy. They substantiate the expediency of using policy of network values differentiation (free provision of simple version of values and sale of extended version) in order to motivate net shaping and to speed up the achievement of project repayment. The economic-mathematic model of shaping network values market was put forward, which differs from existing analogues by more accurate reflection of specific rise in customer cost and shaping demand for these values. The model was used to get answers to two questions: which strategies of pricing can provide better indicators of project quality and whether it is reasonable to motivate demand by providing a free simplified version of value.
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Kuzoma, V. V., and S. I. Pavliuk. "Product Quality as a Definitive Factor of Enterprise Competitiveness." Business Inform 12, no. 515 (2020): 252–58. http://dx.doi.org/10.32983/2222-4459-2020-12-252-258.
Full textAbstract:
The article considers topical issues regarding the impact of products (goods) quality on the formation of a sufficient level of competitiveness of enterprise. Views on the conceptual and categorical apparatus related to "competitiveness", "product competitiveness" and "quality" are generalized, including foreign experience. The purpose of this article is consideration and analysis of the impact of product quality on the formation of the competitiveness of enterprise and the achievement of its appropriate level in modern market economy. The essence of the concept of "product quality" from the point of view of the manufacturer is highlighted. The interdependence between product quality and ensuring the appropriate level of enterprise competitiveness is shown. The main advantages of improving product quality as a factor of competitiveness of products and the enterprise as a whole are given. The main attention is paid to quality as a factor in the formation of consumer confidence, technology "word of mouth", the importance of aesthetic indicators of products (goods). It is determined that the high quality of products (goods) provides greater return on investment and insufficient level of quality at the initial stage is a positive factor in the development of an enterprise. The main ways to improve product quality and product competitiveness are proposed. It is determined that the quality of products (goods) is influenced by a number of different factors, both internal and external (production technology, pricing policy, efficiency of product quality management system, the level of competition in the market, consumer requirements, etc.). Product competitiveness and enterprise competitiveness are correlated as part and whole. The main measures to improve the quality of products (goods), we see: the formation of consumer confidence and communication, the use of technology "word of mouth", the importance of aesthetic indicators in product or goods development, and development of competitive strategy based on marketing research of competitors, consumers, and the market as a whole.