Pricing mistakes that companies make

Pricing strategy is one of the most important factor for a company's success.A good pricing strategy will mean more number of customers and more sales for its products.But,there are cases where companies lose out because of their pricing strategies.Here are some of the mistakes that the companies make while pricing their products.

• Optimizing the prices:Companies call for a last minute meeting for a final pricing of the product.This way a proper pricing for the product will not be done and therefore companies face a lot of losses.
  
• Relying too much on the sales persons:A company must stop relying on its sales persons and the staff on pricing and sales of the products.Instead,it must directly involve with the customer.Mind that a customer will rarely tell a "complete truth" unless and until he is comfortable with the sales parson.Thus,if there is a direct interaction between the customer and the company,the customer will obviously feel the comfort.
  
• Improper price management:Many companies assort to reducing the price of the products by compromising on some features of their product.This may lead to an in-satisfaction of the customer.Because of the compromise,the product's sales will be threatened and customer will end up with a product better than it.
   
• Basing price on manufacturing costs but not on customers value:Profit is what a company wants.
  1. If a company prices on its manufacturing cost but not the other way around(pricing more than the customer's perceived value),cost of the sales will definitely go up but the sales will also come down.
  2. If the price is on the customer's choice,there is no doubt that the price will go up.
  This is one of the most important factor that has really affected the company's profit.

• Pricing on market value: Its common that the companies mark their products on the market value.Although market value is safer for a company's existence,it can affect the company's profit as well.