Business Management Dynamics

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ISSN: 2047-7031

bmd Business and Management Dynamics bmd
ISSN: 2047-7031  
Volume  3   Issue 1  2013  
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Article Abstract
Pricing Practices in New Amsterdam
Keywords:  Pricing, cost plus pricing, profitability, low cost, goods
Jacqueline Murray
The aim of the research was to determine the methods used by business organisations in New Amsterdam to price their products and whether the methods employed by them militate against profitability. Descriptive statistics was used to analyse the data obtained from the 31 business organisations which responded to the survey. The study found that business organisations in New Amsterdam employed mainly cost plus pricing to determine the price of goods but reduced the prices of goods in response to a reduction in competitor prices or increased price when demand increases. A few organisations on occasion priced goods below their cost. The study also found that 80.6% of the organisations were able to make a profit using their chosen or multiple pricing methods. Consequently, it is inferred that the pricing methods used by business organisation in New Amsterdam do not, in the majority of cases militate against profits.
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