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PRICE
• Gro wth
more customers start use for
product, competitors are able to
offer substitutes ---- price
decision
• Marketers face a pressure of
lowering the prices below
introduction stage
• Buyers develop different
purchasing policy as more than
one suppliers enter the market ,
thus, making the innovator firm
to lower the price
Maturity stage pricing strategy
- Prebid Analysis
- Bid Determination
Prebid analysis
• Company objectives
Assist the firm in deciding what
type of business to pursue, when to
bid, & the level of pricing to use
• Sc re eni ng Bi d oppor tuni ties
3 stages in screening
A identification of criteria deemed
important in evaluating contracts
A measure of their relative importance
An evaluation of bid opportunity
Where,
A negotiated strategy
A dictatorial strategy
A defensive strategy
A gamesmanship strategy
100 %
defensive strategy Buy-
ers negotiated strategy
stre- X
ngth
5%
Measuring buyer & seller strength
• Buyers strength
- organization size
- amount of past purchase
- future buying power
- business periodicity
- need for the product
• Sellers strength
- company image
- product quality & uniqueness
- delivery capability
- technical assistance
- post sale service
Measurement table
Strength Scale Weights Total
Criteria Value score
(1-10)
Org. size 9 4 36
Past
purchase
Repeat
Purchase
Total score =
% score = 54% & 62%
Evaluating Buyer & Seller product
Need
• Tactics in negotiation process
depend on buyers need for the
product w.r.t to sellers need for the
sale
• Buyers product need classified as
- Acute , Moderate or marginal
• Sellers need to make sale
>Acute – operating well below
capacity,or to secure prototype
order leading to repeat business
>Marginal – production is near full
capacity or no repeat orders
Determining key Negotiable factors