Etini
Valued Contributor
When we talk about price analysis for businesses, we are taking a dive into the process whereby a business should evaluate the prices it sells it's products against the price offered by competitors for the exact same product. With a properly carried out price analysis, a business would be able to fully grasp how each aspect of the business is affected by pricing. For a proper price analysis by a business, the following components have to be examined:
1) The cost of production of the business: The first thing a business has to understand about the pricing mechanism is how much it spends to produce a tangible good or provide a service. All expenses must be factored in for a balanced price analysis.
2) Prices of other competitors offering similar products: The next step in price analysis is to have a concise info on how much the competitors within the same market that you operate in are selling the same products and factors that make each of them to sell at their respective fixed prices.
3) The reaction of customers to price changes: You would check to understand how an increase or decrease in price affects patronage at varying levels.
Putting these factors into play together, a business van best determine the price that would be most favourable for it to sell it's products.
1) The cost of production of the business: The first thing a business has to understand about the pricing mechanism is how much it spends to produce a tangible good or provide a service. All expenses must be factored in for a balanced price analysis.
2) Prices of other competitors offering similar products: The next step in price analysis is to have a concise info on how much the competitors within the same market that you operate in are selling the same products and factors that make each of them to sell at their respective fixed prices.
3) The reaction of customers to price changes: You would check to understand how an increase or decrease in price affects patronage at varying levels.
Putting these factors into play together, a business van best determine the price that would be most favourable for it to sell it's products.
