The notable product pricing strategies pertinent to

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and elimination strategies. The notable product pricing strategies pertinent to product and customer profitability include the manufacturer’s suggested retail price, multiple pricing, competitive pricing, cost-plus pricing, price bundling, price lining, pricing above competition, pricing below competition and odd pricing (Boone & Kurtz, 2013). The notable product elimination strategies that can be implemented by businesses include options such as phase out immediately, phase out slowly and dropping out the product from range and reinventing and reintroducing as a unique and special sell out. Underlying product elimination, it is important for businesses to have a systemized product elimination strategy for the implementation of product elimination decision. Product costing Regarding product costing, there cost factors that need to be considered by businesses especially when determining prices for products and services. After all, price alone is insignificant if it is not considered within the context of operating costs. Businesses may be able to control a hefty price for products, only to find that the various costs of producing and delivering that product negatively affect customer and product profitability realized on the sale. Concerning business product costing the key notable costs to be taken into account include the following. Labor costs consist of the cost of the work that goes into the manufacturing of a product or the execution of a service (Boone & Kurtz, 2013). Direct labor costs can be figured by multiplying the cost of labor per hour by the number of employee-
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9 hours required to complete the job. Business owners, however, need to keep in mind that the cost of labor per hour includes not only hourly wage or salary of the relevant employees, but also the costs of the fringe benefits that those workers receive. Secondly is the material costs are the costs of all materials that are part of the final product offered by the business. As with labor, this expense can apply to both goods and services. The third type of cost include the overhead costs which are costs that cannot be directly attributed to one particular product. These costs include indirect expenses such as general supplies, heating and lighting expenditures, depreciation, taxes, advertising, rental or leasing costs, transportation, employee discounts, damaged merchandise, business memberships, and insurance. A certain percentage of employees usually fit in this category as well. While the wages and benefits received by an assembly line worker involved in the production of a specific product might well qualify as a labor cost, the wages and benefits accrued by general support personnel are included as overhead (Boone & Kurtz, 2013). Overhead expenses are typically divided into fixed expenses and variable expenses.
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