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The id tag is packaged in a box with a window so that

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The ID tag is packaged in a box with a window so that the consumer can see the product. Allowing the consumer to see the product will let them judge if it’s the right size or shape to place on their phone or other valuables. Inside the packaging will be a carrying case that the product will be sitting in so that once bought it will not be lost by the consumer and will stay protected until it is placed on another product. The label will provide the information on how the product works and a website so consumers can research for more information, also the packaging will have a QR code so consumers can research the product while in the retail store. Pricing 1. You’re pricing objective(s). The pricing model that ID tag should use is a customer orientated and focusing on the “no-haggle” price. Since the ID tag will be a new product on the market and there will be no direct competition at introduction the price should be geared towards customers who want to try the product. 2. Customer. A high price will cause the consumer market that the product is geared for to look for other solutions. The mobile phone market has become an alternative to mobile computers and as more features/technology is included they become more costly to the consumer. The ID tag is offering a piece of mind to the target market and finding the right price will be critical to the success of the patch. 3. Costs. The fixed cost will be set at $200,000 and the variable cost will be $3 the fixed cost should be higher because manufacturing a new product will take time and resource which will be reflected in the fixed cost but over time it will become cheaper to manufacture and profits will be rise. The three price points could be $8, $10, and $12 so the price will stay in line with pricing strategy. The contribution per unit would be $5, $7, and $9 and if divided the $200,000 by the contribution per unit it would have to sell 40,000 at $5, 28,571 at $7, and 16,667 at $9 to reach the breakeven point. 4. Competition. The competition at the introduction should be minor since the ID tag is a new product coming to market. After the launch of the patch there could be a large number of copy cat products, which is a one big area of concern. China is another area of concern because a great deal of knock off products are manufactured there cheaply and is almost impossible to stop. If competition does become a problem then the company would have to competitively price the ID tag so not to lose market shares. The $10 price point would make the most sense based on the pricing strategy. Distribution
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