When should a company initiate price change
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INITIATING AND RESPONDING TO PRICE CHANGES
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Transcript of When should a company initiate price change
INITIATING AND RESPONDING TO PRICE CHANGES
INITIATING PRICE CUTS
Due to excess plant capacity
To dominate the market through low costs
Price cutting strategy can lead to traps
•Low-quality trap
•Fragile-market-share trap
•Shallow-pockets trap
•Price-war traps
INITIATING PRICE INCREASING
Cost Inflation
Over demand
•Delayed quotation pricing
•Escalator clauses
•Unbundling
•Reduction of discounts