Pricing of Services Report PDF

PRICING OF SERVICES UNDERSTANDING COSTS AND DEVELOPING PRICING STRATEGY Presented By : Group 5 Quezon City University | 2024  TOPIC OVERVIEW Foundations of Significance of Revenue Pricing Strategy Management for Service Pricing Objectives...

PRICING OF SERVICES UNDERSTANDING COSTS AND DEVELOPING PRICING STRATEGY Presented By : Group 5 Quezon City University | 2024  TOPIC OVERVIEW Foundations of Significance of Revenue Pricing Strategy Management for Service Pricing Objectives Firm Communicate and Pricing Strategies Implement Service Pricing and Policies Strategies Types of Costs QCU | 2024 FOUNDATIONS OF PRICING STRATEGY Overview Foundations of pricing strategy focuses on understanding how to set prices that reflect the value of the service, attract customers, and ensure the business stays profitable. It’s about balancing costs, customer expectations, competition, and perceived quality to create a fair price that both covers expenses and makes customers feel they’re getting their money’s worth. QCU | 2024  PRICING OBJECTIVES Maximizing Profit Increasing Market Share Setting a price that helps Setting lower prices to the business earn the most attract more customers money. and beat competitors. Building Brand Image Covering Costs Setting higher prices to make Setting prices that ensure your service seem more the business can pay for premium or exclusive. expenses and stay afloat. QCU| 2024  PRICING STRATEGIES AND POLICIES Cost-Plus Pricing Competitive Pricing Calculate your service costs (labor, Set your prices based on what overhead, etc.) and add a markup to competitors are charging for similar QCU | 2024 ensure profitability. services. Value-Based Pricing Hourly Rate Pricing Price your services based on the Charge clients for the time spent perceived value to the customer, rather providing the service, often used in than costs. consulting, legal, or freelance work.  PRICING STRATEGIES AND POLICIES Penetration Pricing Bundle or Packaged Pricing Offer services at a lower initial price to Combine multiple services into a attract customers and build a market package deal at a discounted rate QCU | 2024 presence, then gradually increase compared to purchasing each service prices. separately. Skimming Pricing Tiered Pricing Prices start high for a new or exclusive Offer multiple service packages at service and gradually decrease over different price points, each with varying time. levels of features or benefits.  PRICING STRATEGIES AND POLICIES Psychological Pricing Premium Pricing Use pricing techniques like ending Higher prices are charged to reflect prices in.99 to make them appear exclusivity, quality, or a luxury brand QCU | 2024 lower or more appealing image Flat Rate Pricing Promotional Pricing A fixed price is charged regardless of Used by businesses to temporarily the time or resources used. reduce the price of their products or services in order to attract customers, boost sales, or create awareness.  PRICING STRATEGIES AND POLICIES Dynamic Pricing Freemium Pricing QCU | 2024 Adjust prices based on demand, time, Offer a basic version of your service for or other external factors free while charging for premium features or advanced functionality.  TYPES OF COSTS Fixed cost: These are costs that do not change based on the number of items 1 produced. 2 QCU | 2024 Variable cost: These costs are tied to a company’s level of production. 3 Operating costs: These are those expenses incurred by an organization to maintain the service on a day to day basis. 4 Direct costs: These costs can be directly associated with production. SIGNIFICANCE OF REVENUE MANAGEMENT FOR SERVICE FIRM Revenue management can be defined as a business strategy used to maximize revenue by selling the product or services at the right price, to the right customer at the right time. Commonly used in industries like airlines, hotels, car rentals, and cruise lines where prices and availability fluctuate frequently based on supply and demand. QCU| 2024 SIGNIFICANCE OF REVENUE MANAGEMENT FOR SERVICE FIRM Maximize Revenue It analyze relevant data and techniques and identifying opportunities for creating additional revenue and boosting profits Gain a Competitive Edge Achieve an advantage over your competitors, making your business stand out in the market. QCU | 2024  COMMUNICATE AND IMPLEMENT SERVICE PRICING STRATEGIES Communicate Service Pricing Clearly explaining the cost of a service to customers in a way they can easily understand. Implement Service Pricing Setting and applying prices for the services you offer in a way that aligns with your business goals and meets customer expectations. QCU | 2024  REFERENCES A Guide to Effective Pricing Strategies for your Service Business. (2024, October 22). Jobber. https://getjobber.com/academy/pricing-strategies-service-business/#economy ‌Cost Sheet – Meaning, Example & Format | Zoho Books. (2024, April 5). Zoho Books. https://www.zoho.com/books/academy/accounting-principles/cost-sheet.html QCU | 2024 THANK YOU Presented By : Group 5 Lumbao, Louie Mallari, Rencel Anne Mustasa, Charlyn