Before Jan 1994
Product-by-product based on cost of production
Price decision process
Unit cost + Wholesale margin + Retail margin + VAT
This method is criticized for rigidity caused by government
After Jan 1994
Re-agreement after 3 years with SNP(제약협회)
Each company restrict their medical payments instead of giving them liberty of pricing decision.
Definition
Incentive
Pricecontrol, entry control, production control, procompetitive regulation (economic regulation)
Controlling Entry is the regulation of the entry and exit of firms into a regulated market, which is implemented by mandatory registration, usually called licensing.
Controlling Price is to prices of monopolies on the basis of sometimes conflicting objectives : to prevent abuse of monopoly p
price floor, some sellers are unable to sell all they want at the market price.
By contrast, in a free market, the price serves as rationing mechanism, and sellers can sell all they want at the equilibrium price.
Another one of the Ten principles of Economics :
- Governments can sometimes improve market
outcomes.
However, pricecontrols often hurt more than
Prices on Selected Routes, 1990>
3. How does DHL set the price?
In the pricing step, there are the basic factors to consider. The factors of being reflected to set the base price are four : product(service), weight, origin, destination. Basically setting pricing authority is decentralized, thereby DHL’s country managers had almost total control pricing. They typically set prices based on
price
Experi-mental or new design
Target the upper social class
Affordable price
Democ-ratic design
Target the middle -income class
price>
1. Pricing constraints for Alessi:
- Stage in PLC: Introduction -> How to position Alessi with price
- Competitor’s price: Competitors; Premium kitchenware brands including main one, George Jenson price prod