Cost composition and change law of the hottest car

Cost composition and change law of carton price (Part I)

cost and change law of carton price

(I) value cost and composition

price is a variable, which is affected and restricted by many factors. When pricing goods, we must first analyze these factors, understand their relationship with price, and then choose appropriate pricing methods and strategies. We might as well look at price and cost from the perspective of price strategy:

1. Commodity price is the monetary expression of commodity value, so commodity value is the basis for the formation of price. Generally, the price of commodities is in direct proportion to the value of commodities. However, due to the law of supply and demand and the law of competition, the market price of enterprise products is usually determined by the average price of similar products, and the average market price often deviates from the commodity value (or production price). It is this "Deviation" that not only brings difficulties to the pricing of enterprises' products, but also provides opportunities for enterprises to flexibly set and adjust prices according to the changes in the marketing environment

2. The cost of cartons includes manufacturing costs and marketing costs, which reduces the competitive opportunities of large material companies. It is the most basic and main factor in the price composition and the minimum of carton pricing. The carton price must be able to compensate all the expenses of product production and marketing, and compensate the price paid by the enterprise for the risk of the product. Carton costs can be divided into fixed costs and variable costs. (1) Fixed costs refer to various relatively fixed costs that do not increase or decrease with the increase or decrease of production and sales within a certain limit, such as depreciation of fixed assets, utilities and steam, new product development, market research, office expenses, etc; (2) Variable costs refer to various expenses that increase or decrease with the increase or decrease of production or sales, such as raw material consumption, storage and transportation expenses, manufacturing expenses, taxes, etc. The sum of the two is the total cost of cartons, which constitutes the lower limit of carton pricing

3. Enterprise profit is the difference between price and cost. Therefore, enterprises must understand the change of cost, save all unnecessary consumption, and strive to reduce costs in order to reduce prices, gain competitive advantage, and achieve the marketing goals of enterprises

(II) the law of price and supply and demand changes

1. Supply and demand affect prices, on the other hand, prices affect supply and demand. Price changes cause changes in supply and demand, and further affect the realization of enterprise marketing goals. The impact of price on supply and demand in the testing process can be reflected by the price elasticity of supply and demand

(1) the price elasticity of supply is referred to as supply elasticity, which refers to the degree to which the supply of products reflects price changes, and its size can be expressed by the supply elasticity coefficient. The supply elasticity coefficient is equal to the ratio of the percentage change of supply volume to the percentage change of price. The ratio has five cases: greater than 1, equal to 1, less than 1, infinite and equal to zero, which respectively means that the supply is elastic, unit elastic, inelastic, infinite elastic and completely inelastic. Among them, the most common is the supply of flexible products. If the price of enterprises is too high, it is easy to stimulate competitors to join, and the supply of products that lack flexibility is suitable for setting high prices

(2) price elasticity of demand, referred to as demand elasticity and cross elasticity for short. Demand elasticity refers to the degree to which the demand of a product reflects its own price changes, and its size can be expressed by the demand elasticity coefficient. The elasticity of demand is equal to the ratio of the percentage change in demand to the percentage change in price. The ratio can also be greater than 1, equal to 1, less than 1, infinite and equal to zero, which respectively represent demand elasticity, unit elasticity, lack of elasticity, infinite elasticity, and complete elasticity. Among them, for products with flexible demand, it is appropriate to set a low price to stimulate end users. Through small profits and quick turnover, the enterprise's profits are still considerable. For products with inelastic demand, when the market demand is strong, it can appropriately raise the price or raise the price, which can not only improve the value of products, but also increase profits

2. The supply and demand mechanism in the market mechanism reflects the changing law of the interaction between supply and demand and price of market commodities. Therefore, studying the supply-demand relationship and its changing trend of cartons has a positive guiding significance for enterprise pricing. In a certain period of time, the supply and demand of cartons is 4 Processing quality has three forms: balance between supply and demand, short supply and oversupply. When supply and demand are balanced, the output is balanced, and the sales price is balanced, but this equilibrium is often temporary, and the imbalance between supply and demand is common. When supply exceeds demand, a buyer's market is formed. At this time, the buyer takes the initiative in the market, and the carton factories compete for customers and sales. At this time, the price should be adjusted in time according to their own product conditions, so as to be invincible. On the contrary, once a seller's market is formed, the price of cartons should be appropriately increased

(to be continued)