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  • 1 Slide Multipart Price Structures in Industry: Utilities

    Uploaded by

    Ralph John Dalogdog
    150 views2 pages
    Firms can use multipart pricing structures to maximize profits from customers. Utilities commonly charge both a connection fee and per-unit price for water or electricity. Software companies may charge a base price plus additional fees based on number of users or customers. Healthcare combines insurance premiums with fees per doctor visit. Industries involving partial ownership like timeshares use multi-part fees based on unit of time rented. Printer companies keep printer prices low but charge high prices for ink refills. Executives refine fees to better capture the value provided to high and low volume customers. Block and inclined tariffs further vary the per-unit price based on consumption levels.

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    pricing strategy

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    Thunder

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    Firms can use multipart pricing structures to maximize profits from customers. Utilities commonly charge both a connection fee and per-unit price for water or electricity. Software companies may charge a base price plus additional fees based on number of users or customers. Healthcare combines insurance premiums with fees per doctor visit. Industries involving partial ownership like timeshares use multi-part fees based on unit of time rented. Printer companies keep printer prices low but charge high prices for ink refills. Executives refine fees to better capture the value provided to high and low volume customers. Block and inclined tariffs further vary the per-unit price based on consumption levels.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    Download as docx, pdf, or txt
    150 views2 pages

    1 Slide Multipart Price Structures in Industry: Utilities

    Uploaded by

    Ralph John Dalogdog
    Firms can use multipart pricing structures to maximize profits from customers. Utilities commonly charge both a connection fee and per-unit price for water or electricity. Software companies may charge a base price plus additional fees based on number of users or customers. Healthcare combines insurance premiums with fees per doctor visit. Industries involving partial ownership like timeshares use multi-part fees based on unit of time rented. Printer companies keep printer prices low but charge high prices for ink refills. Executives refine fees to better capture the value provided to high and low volume customers. Block and inclined tariffs further vary the per-unit price based on consumption levels.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    Download as docx, pdf, or txt
    of 2

    1st slide

    Multipart Price Structures in Industry


    ( industry is a sector that produces goods or related services within an economy. )

     Multipart Price Structure in Industry can enable a firm to better capture profits from their customer.
     Combined, the entrance fee plus the metered fee, durable and consumable good sales, enable the
    firm to shifts profits between different parts of the structure.
     Firms also take advantage of the ability of multipart price structures to enhance profits.

    2ND Slide
    Utilities

     Utilities use one of the purest forms of a two-part tariff. They regularly
    charge a metering fee or connection fee plus a price per quantity of
    utility delivered.
     Low usage customer. Willing to pay high but they have little willingness
    to pat for further consumption. High Usage customer. Have a higher
    willingness to pay for further consumption.

    3rd Slide
    Enterprise Software

     Price is constructed from some combination of base plus unit prices.


     ES firms should make the unit price closely related to the actual value that a
    customer derives from using the product.
     For instance, a software firm that sells a billing and customer-care products
    used the number of customers as a means for determining the price.
     Inventory management software, Educational software, Hospital software, and
    Industrial design management software
    Healthcare

     Healthcare customers may pay insurance that ensures access to health


    care and pay a second fee per doctor’s visit or medical service.
    4th slide
    Partial Ownership

     Partial industries such as time-share vacation homes, leased-time yachting


    , or car sharing.
     Fees have been determined on a per-week, per weekend, per day, or
    per hour basis.
     Heavy users pay a lower average price and Light users pay a higher
    average per use.
    Computer Printer manufactures

     Typically, the price of printer is low to capture customer while the price of ink is
    high to capture profit. The printer is the durable portion of the sale, while the ink
    is the consumable.

    5th slide
    Refining the Entrance Fee and Metered Fee

     Executives often find that they can improve revenues further and capture a
    greater share of the value that they deliver to customer by altering the
    entrance fee or metered fee.
     High-volume applications often face different, perhaps wider alternatives than
    low-volume usages. The greater number of alternatives may depress the
    willingness to pay on a per-use basis. Alternatively, a high-usage customer may
    be willing to pay significantly more for access to the service than a low-usage
    customer.

    6th slide
    Block tariff

     It refers to changing the price of the metered service at different levels of consumption.
    Inclined Tariff

     This pricing mechanism is not one designed to maximize profits, but rather to ensure that all residential
    customer have access to a basic level of service and to charge higher process from customer who have
    a much higher consumption level to discourage this behavior.

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