For my business I could use the following methods to help give my products a successful yet profitable price.
I think that cost-plus pricing is the simplest method of deciding the price of a product. This is how to work out cost- plus pricing:
Unit cost + overheads + profit margin
= selling price
I could also use Price skimming this is when the prices of my good are set at a low enough price to make little profit but this is done so that the good is sold at a low price but it still makes money and if I use this method I will hope to sell a lot of the goods at a low price making small profit on each unit but hoping to get a larger share of the market so therefore hoping to make more profit. I think that this is a good method of selling the goods as it is sold for a cheaper price but not so cheap that I am losing money.
But when I am pricing my products I don’t want to over price them to much as people may thing that I am charging to much this would also give me a smaller share of the profit, but at the same time I don’t want to under price my products as people may think that they are too cheap and they may be faulty or I may be losing profit if they are under priced.
However I will not have to decide the price of my products because I am opening my business under a franchise format which means that the company “game” will decide the price of the products for me.
For the advertising of my game shop I may just hand out leaflets around Didsbury village telling the residents about the new shop which has opened. I will also have leaflets in the shop which have any new products on the and giving details of the product I think that this will be good because people will look at the leaflets and they may come back to buy that product and “game” will also provide me with the leaflets. Other than that I will not really be worried about advertising my business because Game already has a website, and already advertise on television. So when people see my business they will not be wary of it as they will already be familiar with the name of the company and the products it sells.
My business location will be a shop that people can come to and see the actual product before they purchase it. Before deciding the location I will need to consider the following factors:
- Population of the area, my business may create jobs for the local residents.
- The type of people living in the area, are they the type of audience I want to target.
- The income of the residents, are they wealthy enough or have they got the reasonable amount of money to buy my products?
- Competition, are there any other game shops in this area?
- Is my game shop visible enough?
- Is it in a convenience place, for example near a bus stop or car park?
Considering all of these point I have decided that my shop should be located in Didsbury village as the target audience (teenagers) Is right, people have professional jobs so they can afford the products, there’s hardly any competition and to make my shop more visible I would prefer to have it on the corner of a block of shops or near to a bus stop so it is easy for people to reach the shop if they are coming by bus, but it may not be a good idea to have the shop next to a bus because people stand around for a while and so they may cause the out side of the shop to look untidy by dropping litter. As they are standing around this is also good because there’s more of a chance of people noticing the shop, and being interested to come in.
