Assignment #1: Price Points, Buyers Perspective, and

Macroenvironment

Name: Abbas Ahmadzai

Class: MKT 200

Professor: Dr. Arni Thor Arnthorsson

Date: 09/09/ 2023

1. How do you know that a certain product is at the right price? Is there a difference

between the perspective of the buyer and the seller?

To begin with, I do not believe there is a universal solution to the problem of determining if a

given product is being sold for the proper price. The ideal pricing will, however, rely on a variety

of elements, such as the product itself, the demographic being targeted, the level of competition,

and the manufacturer's objectives. The factors to consider when determining the right price for a

product would include:

1. The cost of manufacturing: The seller is responsible for paying all production expenses,

such as those for materials, labor, and overhead.

2. The targeted profit margin: The price of the product must be high enough to cover costs

and earn a profit for the seller to benefit from the sale of the item.

3. The business's objectives: The seller could have a number of goals for the product,

including maximizing profit, expanding its customer base, or raising customer loyalty.

These goals must align with the product's pricing, or to put it another way, the pricing

should not have an impact on the total sales or goals that need to be achieved.

4. The audience or market: The seller must consider how much the market is prepared to

spend on the goods. The target market might not be capable of affording it if the price is

too high.

5. The in-market competition: the seller must consider the costs of competing goods. If a

seller's pricing is excessively high, potential buyers can decide to shop elsewhere.
In addition, when deciding on the appropriate price for a product, the perspectives of the

customer and the supplier might diverge. The seller or manufacturer wants to make as much

money as possible, whereas the buyer normally seeks the lowest price. However, there may be

instances where a customer is prepared to pay more for a product, they believe to be exceptional

or rare.

The price that both the customer and the seller are willing to accept is, in the end, the appropriate

price for a thing. There is not a collective solution, thus each situation will require a different

price.

 Here are some other pointers for choosing a product's appropriate price:

 Carry out a market analysis: Collect information on the costs of comparable items

available on the market. This will provide you with a solid foundation from which to

establish your own pricing.

 Take into account the product's worth: What advantages does the product give the

consumer? How much are clients prepared to spend on these advantages?

 Apply pricing techniques: The best price for a product may be established using a number

of different pricing procedures. Cost-plus pricing, value-based pricing, and competitive

pricing are a few popular tactics.

 Try out various pricing: After deciding on a few potential prices, test them out on a small

sample of clients. This will enable you to learn how people feel about the pricing and

determine which is most useful.

In conclusion, choosing the appropriate price for a product is a complex problem for which there

is no universally applicable solution. A variety of variables, such as manufacturing costs, profit

margins, corporate goals, market dynamics, and competition, all play a role in this dynamic

process. The buyer's desire for affordability may differ from the seller's desire to maximize

profits, thus complicating the pricing issue. The right pricing for a product arises from a careful

balancing act between these variables, and it differs depending on the circumstances. Businesses

should do detailed market assessments, assess the perceived value of their products, and use a

variety of pricing approaches, including cost-plus pricing and value-based pricing, to determine

the best price plan. A small customer sample can be used to test out various pricing techniques to

see which ones perform best. Additionally, in this complicated market there is no one-size-fits-all

pricing strategy, therefore each pricing choice should be made in light of the particular

circumstances and goals of the company. Businesses may refine their pricing strategy and boost

their competitiveness by carefully taking these variables into account and continually reacting to

market conditions.

2. Name a macroenvironment you think impacts the price of food products?

Food product price is a complex phenomenon that is impacted by a number of

macroenvironmental variables. These variables span the economic, technological, natural, social,

and political spheres and each has a unique effect on how much food costs and how affordable it

is. It becomes clear in this setting that these factors' interactions are crucial to understanding the

dynamics of food pricing. While technical advancements might improve efficiency and

accessibility, economic shifts can drive demand and change costs. Natural calamities, shifting

climatic patterns, and changes in customer tastes can affect manufacturing. In addition,

government policies, such as tariffs and safety requirements, influence how much food costs.
This investigation dives into the complex interplay of these macroenvironmental variables and

their crucial bearing on the costs of basic food.

 • Economical aspects: The state of the economy can have a big influence on food product

prices. People often have less discretionary money during economic downturns, which

can reduce demand for food items and drive down costs. In contrast, individuals often

have more discretionary money during economic booms, which can increase demand for

food items and drive up costs.

 • Technological aspects: There are many different ways that technological developments

might affect how much food goods cost. For instance, modern agricultural technology

may boost crop yields and drive down costs. Additionally, new food processing

technology can increase the affordability and practicality of food items.

• Natural calamities, such as droughts and floods, can interrupt the food supply and drive up

prices. Furthermore, it is anticipated that climate change will have a considerable effect on

food production in the future, which might result in increased costs.

• Social aspects: Social developments, such as the rising acceptance of organic foods, can

have an effect on food product costs. For instance, the price of organic food products is rising

as a result of the rising demand for organic food.

• Political aspects: Government regulations may have an effect on food product costs. For

instance, taxes on imported food may result in price increases, whilst subsidies for domestic
 food production may result in price reductions. Government rules on food labeling and safety

may also have an influence on the price of food production.

In conclusion, the complex interaction of economic, technological, natural, social, and political

aspects in the pricing of food highlights the complexity of this vital business. The prices and

accessibility of food goods are influenced by economic cycles, technical advancements, natural

disasters, societal trends, and governmental policies as a whole. The market for food prices is

always changing as a result of shifting economies, technological advancements, and the threat of

climate change. Consumers, manufacturers, and politicians must all be able to comprehend and

navigate this complex environment. It emphasizes the necessity of adaptable techniques,

sustainable practices, and careful policymaking to maintain the affordability and accessibility of

food items for everyone.