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  • Price Point Estimation for Dog Food Delivery Service

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    Prathmesh Joshi
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    This document estimates the price point for dog food by calculating expenses and savings. It finds that producing and delivering the dog food themselves rather than buying from others would save over Rs. 2,900 per month on transportation, vet bills, and extended shelf life. This justifies setting the price at Rs. 420/kg, which is a 16% discount from the market price of Rs. 500/kg but still provides a 29% margin.

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    price point estimation

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    Price Point Estimation

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    This document estimates the price point for dog food by calculating expenses and savings. It finds that producing and delivering the dog food themselves rather than buying from others would save over Rs. 2,900 per month on transportation, vet bills, and extended shelf life. This justifies setting the price at Rs. 420/kg, which is a 16% discount from the market price of Rs. 500/kg but still provides a 29% margin.

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    © All Rights Reserved
    Als DOCX, PDF, TXT herunterladen oder online auf Scribd lesen
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    7 Ansichten1 Seite

    Price Point Estimation for Dog Food Delivery Service

    Hochgeladen von

    Prathmesh Joshi
    This document estimates the price point for dog food by calculating expenses and savings. It finds that producing and delivering the dog food themselves rather than buying from others would save over Rs. 2,900 per month on transportation, vet bills, and extended shelf life. This justifies setting the price at Rs. 420/kg, which is a 16% discount from the market price of Rs. 500/kg but still provides a 29% margin.

    Copyright:

    © All Rights Reserved
    Als DOCX, PDF, TXT herunterladen oder online auf Scribd lesen
    Markieren Sie unangemessene Inhalte
    von 1

    Price Point estimation:

    Expenses/savings Rupees

    Current price/kg 300

    Market price/kg 500

    Dog food Demand- kg/month 13 (4000/300)

    Monthly Transport Cost incurred in buying dog 500 Home delivery


    food saves money

    Average monthly dog inspection (vet) cost 1000

    Reducing bills by 50% 500

    New Average monthly dog inspection (vet) cost 500

    Shelf life of ordinary packaged dog food 12 months

    Shelf life of DTC product 18 months


    (optimistic)

    Expiration time benefit of DTC dog Food 6*13*300/12=1950


    per month

    Average monthly value added 500+500+1950=2950 Transport, vet, Shelf


    life cost

    Average monthly expenditure of customer 2500


    target segment on dog food

    Total expected value for the targeted 2500+2950=5450


    customers

    Expected price per kg of dog food 5450/13 ~420

    %discounted on Market price ~16%

    Margin Gained ~29%

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