Practical Pricing for Results by Ian Ruskin-Brown

By Ian Ruskin-Brown

This booklet offers marketers with a pragmatic consultant on how you can set and deal with the pricing of either the goods and prone that they provide. It outlines the method of deriving a pricing process first, after which tracking the revenue implications of any pricing judgements made. In a logical, sequential structure, the writer units out simple monetary instruments resembling the revenue and Loss Account, and explains how top to appreciate, and negotiate inside, the enterprise to enterprise and enterprise to customer markets. In a weather of marketplace instability, the booklet is a well timed exam of pricing as a vital functional self-discipline within the enterprise global.

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Profit is Sanity! ” Anon Any salesperson with a volume-based quota or bonus system and with some level of control over the final price, will have a natural incentive to use a lower price so as to ‘close the deal’. Customers know and take advantage of this sales behaviour, they would be fools not to. A salesperson who can close a deal at a 10% discount is going to do it every time. The salesperson still gets 90% of their bonus. The problem is that the company often loses 100% or more of their profit on that sale (see Chapter 6).

Freedom to manoeuvre in the first stratagem may be constrained by legislative imperatives, possibly including quality specifications. 42 PRACTICAL PRICING FOR RESULTS On the second issue, monopolies/oligopolies will restrict their capacity so that ‘supply’ is always less than underlying demand. e. a ‘want’ with the money to pay for it). Price is raised to the point where demand falls off to meet the capacity available. There is frequently, little sense for a monopolist to invest in new plant and equipment so as to increase capacity.

In this discussion we also examine the rules of marginal pricing which are for “the adherence of fools, but the guidance of the wise”. That is to say if you have to employ marginal pricing – this is the way to do it. Towards the end of that chapter we also examine the various considerations for responding to the invitation to tender. e. ). During the discussion of this topic we examine briefly a method for estimating the 24 PRACTICAL PRICING FOR RESULTS probabilities of winning the tender against known and studied opponents.

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