FIN 352 Lecture Notes - Lecture 3: Profit Margin
Document Summary
Price zones can be referred to as volume price zone (middle price lines), promotional price zone (lower price lines), and prestige price zone (highest price lines) Why is pricing important: the success of optimizing sales depends on sound pricing and repricing principles, pricing the generally the sole responsibility of the buyer, however, management constraints must be considered/adhered to (desired profit margin, store image) Price maintenance policies of manufacturers, such as (cid:498)suggested(cid:499) retail prices. Nature of the goods, such as markdown risk in fashion goods. Price line reports: provides the ability to analyze an entire department"s sales trends, page 61: price line report example. The relationship of basic pricing factors: 3 basic elements involved in the pricing of all goods: Cost of the merchandise: retail price, markup, markup: amount added to the cost price of merchandise to arrive at a retail price. Cost % = ($ cost / $ retail) x 100.
