Advertisements
Advertisements
Question
What are the conditions under which parity pricing is desirable?
Advertisements
Solution
Parity pricing is an appropriate strategy in the following situations:
- When it is very difficult to measure costs, parity pricing may be the logical first step in a rational pricing strategy.
- When price leadership is well established, charging according to what competitors are charging may be the only safe policy. In an oligopolistic market, charging lower than the leader may lead to price war.
- Where competition is very severe and competitive products are homogeneous.
- It may be less troublesome and less costly than an individualistic pricing strategy.
APPEARS IN
RELATED QUESTIONS
Explain the below mentioned pricing strategy:
Skimming pricing strategy
Under this Pricing Strategy, a business firm adjusts its own price policy in accordance with general pricing structure in the industry.
The main aim of penetrating pricing is to ______.
______ determines the sales volume and the profit margins.
The pricing strategy involves charging according to what competitors are charging ______.
Which pricing strategy will be used to launch a high end auto motors?
Mention the advantages of cost plus pricing.
What is skimming pricing?
What pricing strategy will be used to launch shampoo?
Discuss the cons of Penetrating Pricing Policy.
