The Most Appropriate Pricing Technique for Cadbury Essay -- Business M

The Most Appropriate Pricing Technique for CadburyThere are 7 different pricing techniques that are available toCadbury.1. First pricing technique is skimming pricing. With skimming pricing,these prices are set very high to take return of some peoplesdesire for a new product or design at any price.Skimming is nigh effective if drive is inelastic. For e.g. Cadburyput their prices at the same as most of their competitors and at theprice their guests are able to pay.2. Cost plus pricingPricing methods which are found on the address structure of Cadbury thatare favoured by accountants because they are supposedly more accurateand reliable.Cadbury is trying to maximise it profits. This method workssuccessfully because all costs direct to be accurately accounted. Inmany firms this is a very difficult litigate which is why the simplermark-up procedure is used. Cost plus pricing tends to ignore thedemand for the product and the competition. 3. Positioning pricingCadbury uses this meth od to position prices that are set which reflectthe consumers view of the chocolate bean.4. Demand based pricingCadbury set their prices based on what they think the consumer isprepared to pay. If they dont then they wont sell as good as theythought. If they do sell at the customers price they will fox a goodreputation and an output of more customers.5. Competitive pricingIn this situation Cadbury set a price roughly in line with theircompetitors. This will depend on the type of competition that existsfor the chocolate bean. It is particularly the number of seller andthe number of buyers.This process works reasonably well if the cost structures of thecompanies are roughly similar.6. Discount pricingCadbury is a competitive market which buyers should be able to obtaingoods for little than the advertised price. Many firms can be forcedinto price-cutting if they are short of cash or need to increase salesquickly.7. Different pricingCadbury may change different prices sometimes for t he same product atdifferent times. Its prices will be based on the elasticity of demandfor the chocolate bean.Which is the most abstract for this market type?The most appropriate strategy for Cadbury is Cost Plus pricing andDemand based pricing.Cost plus pricing is appropriate because the information is moreaccurate and reliable which is good... ...ghtly difficult but they have managed due to good marketingstrategies. It has distributed its products in many federal agencys even if theyhave failed in some but they always try to find the right way todistribute their product so their customers stay satisfied.PRODUCER WHOLESALER retail merchant COMSUMERWhen there are a large number of retailers, Cadbury (the manufactures)will usually deal with a wholesaler who buys in bulk, stores theproducts and sells them on to the retailer in littler quantities. Asmall grocer will usually go to the wholesaler. This is mainly doneregularly to avoid the small space. Advantages of long channels- Ret ailer gains convenience and minimises storehouse costs- Consumers are able to buy in small quantities from retailers- Goods are available close to where they are needed- Wholesalers provide valuable retailer gage services- Transport costs are lower because the producer does not have to make as many deliveries.Disadvantages of long channels- Prices tend to be higher when goods change hands many times compare prices in the corner shop with those in supermarkets- Producers have less control over the way in which goods are stored and sold