This document discusses price determination for automobiles. It begins with definitions of price and price determination. It then outlines the 8 major steps in the price determination process, including market segmentation, estimating demand and costs, pricing policies and strategies. It discusses internal and external factors that influence pricing, such as demand, competition and costs. It provides a case study on the price determination process of Pak Suzuki Motor Company in Pakistan, outlining their mission, vision, values, pricing strategies and a SWOT analysis. It concludes that Suzuki follows a price determination strategy to maintain competitive prices while delivering customer satisfaction. Recommendations include continuing an economic pricing strategy and expanding manufacturing facilities.

2. Maria javed
Mba IT

3. TOPIC
Price determination for
automobile

4. Main headings:
• Introduction to the topic
• Important sub-topics
• Practical study of the
organization
• Swot analysis
• Conclusion
• recommendation

5. Definition of price:
The amount of money expected, required, or
given in payment for something.
DETERMINATION:
The process of establishing something exactly by
calculation or research.

6. Definition of PRICE DETERMINATION:
The interaction between the demand
and supply in the free market that is
used to determine the costs for a
goods or service.

7. Some of the major steps involved in price
determination process are as follows:
•Market Segmentation
•Estimate Demand
•The Market Share
•The Marketing Mix
•Estimate of Costs
•Pricing Policies
•Pricing Strategies
•The Price Structure.
8 Steps Involved in Price Determination Process

8. Price determination internal and external
factor

9. Demand is the key determinant for market oriented
company. Demand is the starting point for all activities. Simply,
the average customer will be demanding different product
quantities, depending on price.
Competition has a significant influence to price
determination of market oriented companies. Prices need to be
adjusted in order to address the competition. Every company
should research market and competition, prior to launch of the
new product.
Costs – While demand and competition are external factor,
the costs are internal. The costs must be embedded in every
stage of price determination process.

10. Life Cycle pricing approach analysis the current phase of product life in market.
1.) Entering phase usually requires higher sales prices in order to payback initial
development costs. Also customers are willing to pay more for a new product
2.) Growth phase is bringing the market stabilization. Prices are more or less stabile.
3.) Saturation phase leads to price decline, due to competition entrance and loss of
consumer's interest.
4.) Declining phase is the last part of product life cycle. Prices are still going
down.

11. Sales Channels have the different shopping occasion. Consequently the pricing is adjusted
to sales channel. For example, the same products is cheaper in hypermarket than on petrol
station.
Government is usually do not interfere into price determination. Exceptionally it
may limit maximal prices for a certain products. Still, government is influencing
pricing, since the taxes & custom duties are the part of the price.

12. Objective of price determination
• Maximize long run and short run profit
• Increase sale
• Increase market share
• Company growthTo obtain and maintain the
loyality and enthusism of distrifution and other
sales personnel.

13. Practical study of the organization

14. Introduction
Pak Suzuki Motor Company Limited is a name of repute in
Automobile assembling and manufacturing in Pakistan. It is due to its
committed and dedicated workforce through which it has sustained
leadership position in the automobile sector in terms of production &
sales.
The firm was founded in 1983 as a joint venture between the
government of Pakistan and Suzuki Motor Japan, formalizing the
arrangement by which Awami Auto Ltd. had produced the Suzuki
SS80 from 1982.
However, despite all the short comings and serious quality criticisms,
the Suzuki Cars are Pakistan's highest selling cars due to the lack of
alternatives available owing to the monopolistic nature of Pakistan's
auto industry and restrictions imposed on imports by the government
of Pakistan.

15. MISSION
Strive to market value packed products
that meet customers’ expectations.
Provide a platform where our
stakeholders passionately contribute,
invest and excel.
Make valuable contribution to Social
development of Pakistan.

16. VISION
•To contribute to pakistani society through development of
industry in general and automobile Industry in particular.
•To improve skills of employees by imparting training.
•To provide automobile of international quality at
competitive price.

17. VALUES
•Customer Obsession
•Fast, Flexible, First Mover
•Innovation and creativity
•Networking and partnership
•Openness and learning

18. Price of the car
Price of the car is one of the major factors that affect the supply as
well as the demandof a car. If the price of the car is high in the
market, the manufacturer or the supplier will want to supply more
units in the market so he can earn more profits.In the automotive
industry where the market type is oligopoly, if one company drops its
price for the car, there is a huge impact on the sales of the other cars
as well as the same car. In the market the price of one car is inter-
related to the price of the other cars in the same segment. The best
solution is that market equilibrium should be achieved so that the
amount of the quantity demand should be equal to the amount of the
quantity supplied to achieve maximum profits. A Market Equilibrium is
achieved at the point of intersection of the demand line and the
supply line. The point is the equilibrium point where the quantity
demanded is equal to the quantity supplied.

19. CURRENT STRATEGIES BY Suzuki
Pricing strategy - catering to all segments
Offering one stop shop to customers
Repositioning of suzuki products
Customer Centric Approach
Committed to motorizing pakistan

20. Price determination in suzuki:
There are various factors to determine a price of a car,such as:
•market condition
•cost incurred to build a car
• profit by company
• dealer profit
The company’s pricing strategies are such that
every customer can own a car or upgrade to another
one of his or her choice. The company offered a
different model at a price difference of around
10,000. It follows a price-point-strategy wherein they
have products available in almost all possible price
points.

21. Swot Anaiysis
Strength:
•Highest Market Share
•Low Price Vehicles
•Large Distribution Channels
•Highly Innovative and deep product line
•Easy available of spare parts.
•Well Managed and highly competitive staff

22. Weaknesses:
•Scarcity of raw material
•Bargaining power of supplier is low
•Lack of coordination and linkage with
Government/semi governmentsupporting bodies
•Less Technical Training Institute
•Less distribution channels in sub urban
Opportunities:
•Increasing Demand for Cars
•Large Market size to operate
•Global spare part market
•Space saving Small size CNG cylinders

23. Threats:
•Foreign Investment and setup production facilities
•Smuggling of Auto Parts
•Inflation rate
•Heavy Taxes
•Competition from import cars
•Increase of Fuel Price

24. Conclusion
After completing this project I conclude that Suzuki is also follow the price determination
strategty. Suzuki stands for value as much as it stands for performance. In spite of rising
input costs, the company tries their best to keep prices down. Their running costs and
resale values are unbeatable too. Competitive strategy of this company facilitated healthy
profit and customer satisfaction and its recognition as a company which stands for
environmental concerns. Nothing matches the delight their cars deliver. In fact, customer
they don’t buy a Suzuki, they invest in it.
The Suzuki is also aware of the emerging competition in the small
car segment and has drawn up a well planned strategy to maintain its market lead
by bringing new models this year.SUZUKI has strong position in market and also have
strong and good customer relationship.

25. Recomandations
I want to recomand these steps for the improvement of price
determination stratagy:
Continue Economic pricing strategy as it will help to achieve
goal of become cost leader.
Expansion of manufacturing facility to achieve economies of scale.
Suzuki should Develop the price structure on the basis of pricing
policies.
Suzuki should research market and competition, prior to launch of the
new product
company should use the information for continues improvement
through by taking feedback.