Lesson Notes By Weeks and Term - Senior Secondary School 1

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  4. Pricing II

Term: 3rd Term

Week: 2

Class: Senior Secondary School 1

Age: 15 years

Duration: 40 minutes of 2 periods each

Date:       

Subject:      Marketing

Topic:-       Pricing II

SPECIFIC OBJECTIVES: At the end of the lesson, pupils should be able to

  1. List and explain the factors that influences price
  2. List the factors that determine price

INSTRUCTIONAL TECHNIQUES: Identification, explanation, questions and answers, demonstration, videos from source

INSTRUCTIONAL MATERIALS: Videos, loud speaker, textbook, pictures,

INSTRUCTIONAL PROCEDURES

PERIOD 1-2

PRESENTATION

TEACHER’S ACTIVITY

STUDENT’S ACTIVITY

STEP 1

INTRODUCTION

The teacher reviews the previous lesson on pricing

Students pay attention

STEP 2

EXPLANATION

She lists and explains the factors that influences price

Students pay attention and participates

STEP 3

DEMONSTRATION

She lists the factors that determines price

Students pay attention and participate

STEP 4

NOTE TAKING

The teacher writes a summarized note on the board

The students copy the note in their books

 

NOTE

FACTORS THAT INFLUENCES PRICE

The factors influencing the price can be divided into two heads – Internal Factors and External Factors.

 

Internal Factors

Talking about the internal factors means the factors that work from within the organization. The factors are:

 

  1. Organizational Factors:

Two management levels decide the pricing policy, one is the price range and the policies are decided by the top-level managers while the distinct price is fixed by the lower-level staff. 

  1. Marketing Mix:

For implementing a price, the marketing mix needs to be in sync, without matching the marketing mix, consumers will not be attracted to the price. The marketing mix should be decisive for the price range fixed, meaning the marketing mix needs to maintain the standard of the price of the product.

  1. Product Differentiation:

In today’s market, it is uncommon to find a unique product, hence the differentiation lies in the nature, feature and characteristic of the product. The added features like quality, size, colour, packaging, and its utility all these factors force the customers to pay more price regarding other products.

  1. Cost of the Product:

Cost and Price are closely related. With the cost of the product, the firm decides its price. The firm makes sure that the price does not fall below the cost less they will run on losses. Cost of the price includes the input cost that a company spends on raw materials, wages for labourers, advertisement cost, promotion cost and salaries for the employees

 

External Factors

External factors are not under the control of the firm. These factors affect the whole industry group uniformly. Yet, a company tries to estimate any upcoming problems in the external environment and also makes up a backup plan in advance. This is done by forecasting the market trend. 

The factors are:

  1. Demand:

The market demand of a product has an impact on the price of the product, if the demand is inelastic then a higher price can be fixed, if the demand is highly elastic then less price is to be fixed. When the demand for the goods is more and the supply of the goods is constant, the price of the goods can be increased and if the demand for the goods decreases the price of the goods should be decreased to survive in the market. 

  1. Competition:

The prices are required to be competitive without any compromise on the quality of the product. While in a monopolistic market, the prices are fixed irrespective of the competition. Thus, the manufacturer tries to estimate the price of his competitor. When the price of the supplementary goods is high, the customers will buy the manufacturer’s product. 

  1. Supplies:

If the supplies condition, the easy availing option of the raw materials are available, then the price of the product can be moderate. Once, the raw materials supply price heightens then the price also rises.

In the period of recession, price is lowered so that easy purchase is guaranteed. While in boom periods, prices shoot up high as now they can earn profit. 

 

DETERMINANTS OF PRICE

  1. Product Cost
  2. The Utility and Demand
  3. The extent of Competition in the market
  4. Government and Legal Regulations
  5. Pricing Objectives
  6. Marketing Methods used

 

 

EVALUATION:    1. List and explain some factors that determines price

CLASSWORK: As in evaluation

CONCLUSION: The teacher commends the students positively