Price Management---- EVERYDAY LOW PRICE?!?!?!?!

What are the methods?

1. Demand-Oriented- whatever price the customer is willing to pay
2. Cost-Oriented- fixed percentage over cost price of product
3. Competitors Oriented- similar to competitor's pricing
4. Mark up pricing- a markup is added on to the total cost incurred by the product
5. Bait and Switch- introduce customer to a cheaper product first

How retailers set their price?

1. Cost of goods- cost of importing the goods
2. Forecasted sales- whether it is feasible
3. Demand- whether the product is in demand
4. Price- how much the customer are willing to pay
5. Customer Income- how much customer earns
6. Need for product- do customer need it
7. Availability of products- whether the customers have a wide choice to choose from
8. Frequency- time spent on product

Price Adjustments

1. Coupons- discount
2. Rebates- money that is returned to customer based on a portion of money spent
3. Variable discount- weekend special, location

Prices to stimulate Sales

1. Leader Pricing- price priced lower than other competitors
2. Price Lining- limited pricing to predetermine price points e.g handphone plans
3. Odd Pricing- price that end with a odd (6.77) or round number ($46)

• Hence we feel that for a premium brand such as Molten Brown, it should be offering a high mark up pricing and the prices should not be determined by competitors products.
• However from visits to the store we noticed that they used Bait and Switch method- as people may be attracted to the low prices that Molten Brown offers at such a high quality.
• Molten Brown from what we observed does not practise leader pricing nor coupons but occasionally they offer variable discount.
• Molten Brown targets at people with money who can afford luxurious goods to pamper themselves thus enabling them to set their price according to customer's income.