The 7 P’s of the Retail Marketing Mix
2) Price
One
of the most important element or variables, and the retailing buying decision is price. The
entire retail organization is dependent on the single factor; it was either make
it or break it. It is also known as the biggest and easiest measurement,
which is subject to change.
Pricing
helps the retail organization to complete its objective. This is also
significant for new market entrant
whose primary function is to establish their brand and then enjoy the increasing
profits as and when the brand gets acceptance from the customers. From the
customer’s point of retailer’s price is considered as one of the main reasons
to visit a particular retail store.
The pricing strategy in
the case of the retail marketing mix should be
consistent and consider the overall positioning of
retailers sales, profits, and rate of return on investment.
The
lowest price may not necessarily mean the best price.
Profit is the difference between cost and price. This can be very high when an
urgent situation is exploited by the salesman.
Cash
flow, overall growth, and profitability are
sort out by the retailers in order to survive the retail business.
But in this case, pricing cannot be determined in isolation, and operating expenses and
costs are equally important while establishing the retail price. Pricing the
products is either based on the market at the cost of the product.
The
profits that are generated are within this and is controlled by the government
and oriented by consumer or
competition. Before one can determine the price, it needs a
certain consideration such as:
(1)
the position of the market,
(2)
the position of the product in the market,
(3)
the perception of the customer,
(4)
various stages of a product life cycle through
which the product is passing along with the competitive strategy and
(5)
the overall retail marketing mix.
The
calculation of retail price should always be based on the markup and not the
cost that is involved.
Following are the components of price mix
(1)
Competition,
(2)
Organizational objectives,
(3)
Credit terms,
(4)
Discount,
(5)
Cost and profit,
(6)
Variable and fixed cost,
(7)
Pricing options,
(9)
Pricing policies, etc.
No comments:
Post a Comment