Pricing strategies have been the topic of my last three posts. You can access them below:

Pricing Strategy: Extenuating Circumstances

The Effect Of Competition On Pricing Strategy

Pricing Strategies - Quantity Discounts

This post deals with a fourth important question to consider as you develop your pricing strategies:

Can You Maintain Your Prices Over Time?

I mentioned earlier that as a product life cycle matures, price usually decreases while competing products increase. So you need to expect some price devaluation over time and build that expectation into your pricing strategies.

Economic changes influence price. A recession or economic downturn can force lower prices for many products. Sometimes the downturn occurs after products are produced so the price difference comes directly from your profit. Your pricing strategies should provide contingencies for dealing with changes that detract from your profits.

On the other hand, inflation and economic upturns can have the opposite effect. Products that you produced at a lower price can then bring you a higher price.

However, profit from that higher price is often eroded by other increased costs like marketing, sales activities, and distribution. You should decide in advance if you will take full advantage of the profit potential brought on by inflation or if you will hold your prices constant for as long as possible.

This post completes my series on pricing strategies. If you’ve enjoyed this series, you can subscribe to receive weekly email summaries of my posts. Then you’ll never miss a series that you will help you. Just complete the form below:

Posted: Pricing Strategies:
Price Consistency

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