More Explanation on Target Pricing

Target Pricing > Forum Log in

More Explanation on Target Pricing
Manik Sood, Manager, India

It is a pricing method that involves:
(1) Identifying the price at which a product will be competitive in the marketplace
(2) Defining the desired profit to be made on the product, and
(3) Computing the target cost for the product by subtracting the desired profit from the competitive market price. The formula:
Target Price - Desired Profit = Target Cost
Target cost is then given to the engineers and product designers, who use it as the maximum cost to be incurred for the materials and other resources needed to design and manufacture the product. It is their responsibility to create the product at or below its target cost.



    Do you wish to study further? You can learn more from the summary, forum, discussions, lessons, courses, training, instructions, expert tips, best practices and education sources. Register.  

Special Interest Group Leader

You here

More on Target Pricing
Best Practices

Expert Tips


About 12manage | Advertising | Link to us | Privacy | Terms of Service
Copyright 2016 12manage - The Executive Fast Track. V14.1 - Last updated: 25-10-2016. All names tm by their owners.