Question

Write a post for the Discussion Forum on this topic, addressing the questions below. You may use either a written paragraph or bullet-point format. Part 1 should be 2–3 paragraphs in length or an equivalent amount of content in bullet-point form. Responses to your classmates’ posts should be 1–2 paragraphs or several bullet points in length.

Part 1: Pricing Strategy

Briefly describe pricing for your product or service. How does this compare to competitors, assuming competitors are at or near break-even point with their pricing? Analyze pricing alternatives and make recommendations about pricing going forward based on the following:

• How sensitive are your customers to changes in price?
• What revenue do you need to break even and achieve profitability?

• What does the price say about your product in terms of value, quality, prestige, etc.?

Answer 1

Product-Tesla (Tesla is accelerating the world's transition to sustainable energy with electric cars, solar and integrated renewable energy solutions for homes and businesses)

The tesla is a special product in this situation, the rivals are close by break even because it means that their overall expense outweighs the overall revneue every day.

In this scenario, you can use a market penetration price strategy that sets the price below the market price, you will suffer some loss in the short run, but it will be profitable in the long run.

The lower price setting would draw customer interest and raise product demand, and it will affect your rivals, even close to the break, so this action will decrease their profit and move one step closer to the break, and they will be forced to exit the market for a period of time.

If the sensitivity is greater, you will certainly set a lower price for your product, attracting more clients for your product with the low price.

The overall sales of your business must be greater than the total expense of the organisation in order to achieve profitability. And when the net revenue is equal to the total expenditure, the business is split. A high price indicates the expense, efficiency and reputation of your product and vice versa.