Market Pricing
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Executive Summary
Price is said to be the biggest factor in the marketing mix. If the price is not right, then the product will not sell. Consumers feel that they have to get something back, such as an intrinsic value from the products. Pricing is affixed with many different variables such as the flexibility of price, geographic term, discounts and price levels over the product cycle. A marketing manager must also consider what type of pricing objective to use. For this paper, I have made myself the new marketing manager of Foster Farms Poultry Products.
The objective that I feel is best for this company is profit-orientated. This is because I believe we have established our name in the community and the state. People recognize us as the leader in poultry production. Since the company has remained profitable since the beginning, we strongly believe that all we should focus on now is maintaining the return on our investment. We shall also adhere to the flexible price policy. I say this because the more a store buys, the more they save. If a store buys large quantities, then discounts can be given and this will also increase sales in the store because the stores can charge a bit less for the product. Its up to the store on how much to markup the poultry. They can charge a dollar a pound or fifty cents per pound. You will also notice that many stores offer the chicken at lower prices when its expiration date is near. This is due to the nature of the product being perishable. There are many competitors out to sell chicken but our prices are competitive. Previous sales numbers suggest high sales from May to January. This increase is from the kickoff to barbecue season landing us all the way into the holiday season. I also see an increase in sales for the company. People want to eat healthier and chicken by far is the healthiest meat of them all.
Our prices also remain constant because of our delivery system. We do not hire outside contractors and deploy the very best chain management system available. Transportation is critical for this company. This is because not only are the products perishable, but we feel the need to get the products to stores faster so they themselves can make profit.
Since our product turnover ratio is high, we make money in the long run. We can sell our chicken at fifty cents per pound and still turn profit in the long run. This is done because we produce in such surpluses. This is because of our locality, the fact that we practically