June 27th 2008
The worldwide terrible high inflation, figuring Pricing up or down? (1-6)
Companies can increase profit either by cost reduction or by margin improvements. Margin improvement or improvement in the gross profit can be achieved either by increasing unit selling prices or by increasing sales volume (this includes the possibility of reducing unit selling prices in order to be more competitive and increase sales volume).
Selling prices are affected by supply, demand and cost conditions. All companies need to ensure that their pricing policy gives the best opportunity for maximising sales and profits.
1. Keep pace with inflation
The inflation rate is the percentage rate per period that prices are increasing and should provide a guideline to the level of price increases generally. Continue Reading »
