with the PESA, it gives us a total unit of 10,590. Which mean the r&d cost per unit will be approximately $189. After that, we add this number with $1,528, which is the cost of producing Tronn, the total cost will be 1,726.86. With 30% markup over cost. the price of the bundle using this method will be 2,244.92, and the profit margin is 518.06.
Value advantage – price aggressively (perceived benefit > perceived price)
Gain market share quickly
Cost fully covered
* High amount of unharvest value – could have price higher
* Company focused
* May lead to price war. From this graph, the competitor will lower their price to the indifferent zone in order to reduce market share loss.
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