Good-value pricing
offers the right combination of quality and good service at a fair price
Everyday low pricing (EDLP) charging a constant everyday low price with few or no temporary price discounts
High-low pricing charging higher prices on an everyday basis but running frequent promotions to lower prices temporarily on selected items
Value-added pricing attaches value-added features and services to differentiate offers, support higher prices, and build pricing power
Cost-based pricing setting prices based on the costs for producing, distributing, and selling the product plus a fair rate of return for effort and risk
Cost-based pricing adds a standard markup to the cost of the product
Types of costs
Fixed costs
Variable costs
Total costs
Fixed costs are the costs that do not vary with production or sales level
Rent
Heat
Interest
Executive salaries
Variable costs are the costs that vary with the level of production
Packaging
Raw materials
Total costs are the sum of the fixed and variable costs for any given level of production