Companies today face a bewildering set of challenges when it comes to pricing strategy as they deal with more intense global competition, informed consumers, ever-increasing data availability and a wide range of possible market research approaches.

APMC helps clients to understand the best pricing strategy at the right time. Thereby three key factors have to be considered:

• Costs per unit: total costs/units sold. This key indicator depends on factors such as how much experience a company has, how its technology position looks like and on specific positions of the P&L. In the long term a company can’t select a price below these costs.
• Average market price: this is the price average competitors ask for the product and customers normally pay. In the long term prices tend to fall because of increased competition, alternative products or decreasing demand.
• Customers’ readiness to pay for the product or price sensitivity: Ideally prices should adapt to this level.

A pricing strategy depends on the overall strategy of the company and market conditions. Expanding companies often adapt market penetration pricing in order to attack competitors market shares offering slightly below market average prices. This strategy can make sense in the short or mid term.
Companies with a declared target to maximize profits may tend to increase prices up or even above average market level; in this case companies must adapt a differentiation strategy based on a USP highlighting their above average product features or quality.
Last but not least in certain cases companies are forced to set prices to a minimum in order to survive.

Through its network of IT developers APMC may also be able to provide sophisticated tailor-made pricing tools enabling managers and sales staff to understand what price to negotiate with their customers.