In order to solve the eternal and very difficult problem of pricing, the best thing to do is to start with a change of name.
To solve the eternal and very difficult problem of pricing, it is convenient to start with a change of name.
An article by Ariel Baños in Fijaciondeprecios.com puts forward a three step corporate strategy to be used to implement a pricing system, whose principle is the formation of a team to lead the company's pricing strategy, which he suggests calling "Revenue Optimization", in order to avoid resistance to their work within the organization.
68% of rice sales in the market are managed by 3 large companies, and 12% of the profits generated by the premiums are concentrated in a single company.
A study by the Chamber of Commerce concluded that the fixing by decree of the price of rice not only did not result in improvements in productivity, but also revealed the way in which the amount of area sown is distributed as well as the profits of rice trading companies in the local market.
The Commission for the Promotion of Competition is opposed to the fixing of grain prices, the only good in the country whose price is established by decree.
Although Corporación Arrocera Nacional (Conarroz) continues to insist on the negative effect of freeing up the price of rice, the Commission for the Promotion of Competition (Coprocom) is maintaining its stance against the measure, arguing that it has not served to increase the volume produced or improve the productivity of the rice sector.
Clearly identifying the direct and indirect costs is the first step forward in the process of defining how much professionals should charge for their services when practicing independently.
Ariel Baños, Economist Founder of Fijaciondeprecios.com:
How much is my job worth?
A major challenge for those who work independently or freelance is to define the price of their services. Identifying key elements to take into account is the first step.
The government's decision to forbid the addition of other products as a perk included with sales of rice is another clear example of its efforts to protect an increasingly competitive sector.
The Solis administration has banned, by means of an amendment to the Regulation on the price of milled rice, the addition of other products as a perk included with sales of the grain, a practice known among retailers as "bandeo".
In Costa Rica the Solis administration intends to keep the current pricing scheme for rice, ignoring technical criteria, and without applying any valid economic justification.
EDITORIAL
Although atechnical study commissioned by the Ministry of Economyitself said that the current regulatory pricing scheme does nothing to improve the productivity of rice farmers or to lower final prices, the government of Luis Guillermo Solis insists on maintaining a practice which favors a few, blocks competition on an equal footing and hurts consumers.
Believing that you can only sell more by having the lowest price or offering the best discounts is one of the myths about pricing that can cause companies to fail.
Some practices used in setting prices which are still considered the most suitable by some, are actually are harmful to long-term management of the company.
Tips to prevent promotions, discounts and special offers from leading to profitability problems.
By Ariel Banos, President and Founder of Fijaciondeprecios.com
5 Keys to implementing profitable promotions
When sales start to slow, promotions and special offers look like a great lifesaver.However, these measures do not always improve business performance.
The answer to how often any of these ten situations occur in your sales department is a good way to diagnose the health of your business.
1) "It's very difficult to sell at these prices, this is the biggest complaint in relation to sales." Vendors argue that the company's prices are a major obstacle to making progress in the market.
2) "Competitors have very aggressive pricing strategies." Rivals survive by moving prices which affects the company and puts it under permanent pressure.
In addition to revolutionizing the concept of transport in cities, Uber is also an example of how trends in price management are changing within companies.
The processes and methods followed by businesses to determine the sales prices of their goods and services are changing as fast as the tastes and preferences of consumers. Products whose prices often vary after a few hours, and "custom" prices are some of the new trends that companies are now following when setting prices. As Ariel Baños explains, the controversial and revolutionary company Uber is a very good example of new ways to set prices today.
The "four secrets" of the technology giant Apple used to set prices of their product lines.
There is no company, large or small, that does not face challenges in determining prices and suitable profitability margins for their products and services today. However, some manage their prices better than others.
Ariel Baños explains that "...The flagship brand in the world masterfully uses price management tools.
With the network of all networks being the main source of information on prices, "companies should not focus on destructive competition, but communicate the differential value of their proposal."
Internet: Excellent for Communicating Prices, Lousy for Communicating Value
By its very nature, the Internet puts prices at the center of the scene. But companies should not embark on the destructive road of price competition, the important thing is to communicate the differential value of your proposal.
The price of your product or service can not be left to the will of the customer and must respond to its value in terms of the satisfaction that the purchase generates.
In its analysis of the issue the president and founder of FIJACIONDEPRECIOS.COM, Ariel Baños, cites two geniuses in innovation:
Henry Ford said, "If I had asked people what they wanted, they would have told me 'faster horses.'" Steve Jobs, Apple´s legendary CEO, also claimed that customers are not clear about what they need, and it is companies who must take on the role of demonstrating the value of innovations.