EXPOMAR EM11A

Phase 6: Price Strategies

1.) Pricing Strategy
Cost-based pricing
The authors opted to use the Cost-based pricing method because their business
happened to be a starting business. This is a basic method used by starting
companies/businesses to penetrate the market by either setting high price to make
high profts initially or establishing low price to make support o the de!elopment o
the product. "owe!er# since Chinese consumers are price sensiti!e# the authors
proposed to set low prices. $y computing the product%s internal which include
materials# labors# testing# and e&ternal etc# and by ollowing the ' basic
considerations# the authors will be aware o the additional cost and e&penses
(transportation# duties# insurance) the time the product is released to the market.
).) *ist o all Possible Costs
+n creating our product the possible cost are raw materials or our product# we will
sell per cartons since it is the trend in China when importing but also it is more
applicable and practical since chopsporks will be used daily. Packaging which our
packaging will be simple and inormati!e. Transportation cost will depend on the
,uantity o cartons will be shipped !ia -ed.& -/$. *abor cost according to the
0epartment o *abor and .mployment the minimum wage or manuacturing
establishment is Php 1'2.33. . +n!entory cost the company also has to make sure that
all the end products are kept sae in the warehouse and the ,uantity o the goods has
a surplus this is to make sure that there won%t be a defcit problem.
1.) Preerred 4ark 5p
/ur preerred mark-up will be P1.3) which is 3.3)6 5S0. 7e think that it is a great
amount which is a!erage. +t is competiti!e compared to other product since its price
combining with its markup is not too high and too low.
8.) Computation
4inimum order 9 1:; kilo ( 18)83 pairs)
China -/$ cost 9186) 5S0
http<//images.ede&.com/downloads/ph/rates/bo&=)31).pd
Expenses Fixed Costs (per
176kilo in Php)
Fixed Cost (per
176kil in USD)
>aw 4aterials P 3.313 (per pair) 9
6182.61;
? 1);.1'
Packaging P 3.316 (per pair) 9
::)8.138
? 1'2.'6
*abor Cost P 11;: ( 1 person
working/1'2 each)
? )'.;8
@ir -reight Cost P 13#18:.; ? :83
TOTAL P 88#1''.88 ? 13'8.':
A>/5P B@4. 4embers
1
EXPOMAR EM11A
Phase 6: Price Strategies
6.) Suggested >etail Price
Pesos Dollars
Total Expenses P 88#1''.88 ? 13'8.61
ark!"p P 3.)6 (per pair) 9
1)#':1.'8
? 116.2;
#etail Pri$e P 6:#3;).)' ? 1833.8:
So our Proft will be :1)? which is P)2#33;.'' in e!ery 88Cilogram we e&port to
China.
;.) *ist o Competitor%s Pricing
Competitors In US $ In Peso
%i&an' (exian' )a*+oo
Co,- Ltd,
5S ?3.331 - 3.3316 / Pair
5S?)3-13/Carton
Php 3.38-3.3; /Pair
Anh"i (on'&e .ro"p
(on'lian' )a*+oo
/nd"str& Co,- Ltd,
5S ?16 D )3 / Carton Php ;33 - '33 /Carton
0in'+o (aish" Onl&est
Co**odit& Co,- Ltd,
5S ?; - )3 / Carton Php )33 -'33 /Carton
0alian "uaying Eada 7ood
Co.# *td.
5S ?11 - 16 / Carton Php )33-833 /Carton
C(L /nd"strial
De1elop*ent Co,- Li*ited
5S ?3.36 - 3.8 / Pair Php 1 D ) /Pair
>eerence<
http<//www.smallbusinessnotes.com/marketing-your-business/cost-based-pricing.html
A>/5P B@4. 4embers
2
EXPOMAR EM11A
Phase 6: Price Strategies
PROJECT
TYPE
Phase 6
TITE P#/C/0. ST#ATE.%
!ROUP
"#$E
El .r"po 121
!ROUP $E$%ERS SPECI&IC CO"TRI%UTIO"S 'EI!(
T
1
Crischelle 4arie
$ustamante
0id number 1.
0id number ;.
) @rhenFe Ao
1 ChriFsalyn 4ontero 0id the con!ertion.
1223
SI!"#TURES
1 1
) 8
)ate o*
S+bmission
4arch ;# )311
A>/5P B@4. 4embers
3