Key Factors To Pricing A Product

In this essay I will be discussing the key factors that a firm should consider when setting the price of a product. I will examine what the most important factors are and how they contribute to the pricing of a product. Pricing of a product whether it is for a small business or a large business a pricing of a product is a very important element of any successful business. I believe that there are seven key points to pricing a product and I will explain them and analyse these below.
1: Costs – When it comes to costing it is necessary for business to sell their products for more then what they create the product for. This is an important part of setting a price for a product as it will determine the main outline for the price. Companies will need to assess the operation expenses of their products when determining the pricing of a product.

Product positioning will be extremely important in the pricing of the product as the variety and quality of the competing products will allow you to position your product in the right area. This depends again on whether the product is of a higher end product or you are looking at targeting the lower cost demographic.
3: Demographics – The demographics factor relates too product positioning but in a more specific way. For example the demographic factors for your product will depend on things such as what the market range age for your product is. You can also take into account the location of your product and the customer’s location. There is a number of different factors that can help you solve the solution into a number of different factor and this is why the demographics is another key feature into setting the price for the