7/30/2019 Notes MKTG 353 November 27

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Rafael AlemMKTG 353

November 27, 20

Margin Analysis & Channel Decisions

Social Media Assignments Due

December 1st

Group Assignment is due on the 7th

Make sure to make it unlisted so people cant find it if searched. Everyone needs to speak in the video since it will be part of your portfolio.

Make sure to apply all the activities about Social Media in your career.

What do you remember?

The Final Exam will be based on putting numbers together to make decisions on marketing strategies on pricingand channel decisions.

Yes or No, should you raise price or change marketing campaign.

You will need this information for your capstone 489Use and keep it in your treasure bag.You will struggle if you do not understand where we are heading.

Mark up policy (margin policywill carry if they can make a percentage profit)ManufacturersRetailers

Purchasing AgentsBuyer/ Purchase

Negotiation

Retail Price/ List Price

On Final

1. What is the markup percent on retail that Footlocker will achieve onthe Nike athletic shoes?

2. What is the markup percent on cost for the same item?3. How much can Footlocker afford to pay for a pair of basketball shoes that will retail at $120and carry a 35% markup on retail?4. Footlocker purchases a line of cross-training shoes from a manufacturer for $42 a pair. Themanager plans to run a special promotion on the item with a 37.5% markup on retail. What retailprice should be placed on a pair of cross-training shoes?

Manufacturer Brand Cost of production

Wholesaler

7/30/2019 Notes MKTG 353 November 27

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Retailer

Consumers Target MSRP

We have to work out the price at the intermediate level in our channel of distribution, not just the consumer pricThe formulas on page 2 will be discussed.

Formula:

Margin % on Price = (Price-Cost)/Price *100%

Margin % on Cost = (Price-Cost)/Cost *100%

Manufacturer Price = Cost * (1 + Margin % on Cost)

Retail Price = Cost / (1 - Margin % on Price)

Make sure you always take initiative since it will make you stand out in front of your peers.

You usually do not have much leeway when setting up your market price, it is subjective to competitoni.If you price high you lose customers, if you price too low you will not make profits or cover your marginal costs

MarginMarkupMarkonUnit ContributionGross ProfitGross Margin

Price = Cost X / ( 1MP%)

Cost = Price * ( 1MP% )

Family businesses make money but they are not making profit because they are not applying the correct pricingpolicy.Excel files - You have to practice several times since it will be on your final

Assignment 2

What has changed is the strategy