QUESTION 10.

4 :
why copst-plus pricing still being employed
by several companies despite of its
limitations ?
SEVERAL COMPANIES STILL USE IT
FOR VARIOUS REASONS:
1.Simplicity: Cost-plus pricing is
straightforward and easy to calculate. It
provides a clear formula for determining
the selling price
2.Cost Recovery: Companies may use
cost-plus pricing to ensure they cover all
their costs and generate a profit margin
SEVERAL COMPANIES STILL USE IT
FOR VARIOUS REASONS:
3.Contractual Agreements: In certain
industries, especially when dealing with
government contracts or large-scale projects,
cost-plus pricing is specified in contracts
4.Regulatory Compliance: Some industries
are subject to regulations that influence
pricing strategies
5.Risk Mitigation: Companies may use cost-
plus pricing to mitigate the risk of
uncertainty in variable costs or market
fluctuations
SEVERAL COMPANIES STILL USE IT
FOR VARIOUS REASONS:
6.Perceived Fairness: Cost-plus pricing may
be seen as a fair method, both by the
company and its customers.
• In conclusion : In today's dynamic
business environment, companies are
increasingly losing the importance of
incorporating a more comprehensive
approach to pricing that considers both
internal costs and external market
dynamics.