Pricing Adaptation with Respect to Geographical Pricing Example to relate with Geographical Price

1. SUVADEEP CHATTERJEE
PGDM-MARKETING FINANCE
PRESENTED BY :
Pricing Management-Assignment
Price Adaptation- Geographical Pricing

2. Price Adaptation
Price adaptation is the ability of a business to change its pricing
models to suit different geographic areas, consumer demands and
prevailing incomes.
Marketing plays a significant role in price adaptation because
pricing strategy is one of the four main components in determining
product positioning.
Companies Usually do not set a single price but rather develop a
pricing structure.

3. Price Adaptation Strategy

4. Geographical Pricing
Adjusting an item Sales price based on the buyer’s Location.
Sometime the difference in sales price is based on the cost to ship the item to that
location or what the people are willing to pay.
Geographic pricing relates to how a business chooses to price its products within
different regions.
In selecting its product prices for different regions, a business also adapts its
marketing strategies to fit those pricing models.
For example, a company may increase its product prices in areas where median
income among consumers is high, and reduce its prices in areas where median
income is low.

5. Barter
Direct Exchange of goods
Geographical Pricing
Receives payment in cash but agrees to spend
some money in the product of the country

6. Geographical Pricing Strategy
 In Geographical Pricing, a Seller must consider the costs of shipping
goods to the buyer.
 These Cost grow in importance, as the freight becomes a larger part of
total variable costs.
Pricing policies may be established whereby the buyer pays all the freight
expenses, the seller beers the entire cost, or seller or buyer share this
expenses.

7. Geographical Pricing-Types
FOB-origin Pricing: Customer pays the freight from the factory to the
destination.
Uniform-delivered pricing: Company charges the same price plus freight
to all customers.
Zone pricing: Customers in different zone pay for different prices.
Company sets up two or more zones. The more distant Zone the higher the
price.
Basing-point pricing: Seller selects some city as a basing point & charges
all customers the freight cost from that city to the customer.
Freight-absorption pricing: Sellers absorbs all or part of the freight
charges in order to get the desired business.

8. Geographical Pricing-Example