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Price analysis and strategies

We carry out the price analysis in the following cases:

  • Optimum pricing of the new product
  • Optimization of the current price of the product, for maximizing sales or income.
  • Investigation of consumers perceptions of the product`s price

For the new products we use three approaches of determination of the price: the optimum price in relation to competitors, the optimum price according to consumers and the optimum price from the point of view of prime cost.

  1. The optimum price in relation to competitors – is the cost of a product which allows the product to look attractively in comparison to competitors. It represents a corridor of the prices (the low and top) within which the price of a product will provide good competitiveness.

 

It`s calculation is based on  data from regular market audits on retail/hospital and wholesale prices.

  1. The optimum price according to consumers — is the cost of goods which the consumer is ready to pay for the product, knowing its properties and advantage and understanding alternatives.

 

It is a corridor of the prices. Above it the cost of a product will be considered too expensive and will limit demand. Below it quality of a product will raise doubts and also will limit demand.

 

For this purpose we usually use methods of poll of consumers and branch experts, “Scale-method” “Van Westendorp’sPrice Sensitivity Meter (PSM)”

 

  1. Price calculation taking into account prime cost of goods and rate of return of the company is the bottom limit of the price below which realization of a product won’t answer company`s strategy.

 

After three price levels will be determined, it will be possible to make the correct decision on the final cost of goods of the company which will maximize on the one hand the income, and on the other hand to provide competitiveness of goods.

 

Optimization of the current price of a medicine, from the point of view of maximizing sales or the income is carried out with use of modeling of indicators of price elasticity, on a database of retail audit of the Business-Credit company.

Contact information

Anna Yabluchanskaya, MD, MPH
+38 095 122 00 99
Irina Derevianko, MD, PhD
+38 067 401 25 27
info@asapgroup.com.ua