a dollar amount added to the cost of products to get the selling price
markup
the percentage of selling price that is added to the cost to get the selling price
markup percentage
the sequence of markups firms use at different levels in a channel - determining the price structure in the whole channel
markup chain
the number of times the average inventory is sold in a year
stock turn rate
adding a reasonable markup to the average cost of a product
average cost pricing
the total cost divided by the related quantity
average cost per unit
an approach to determine whether the firm will be able to breakeven - that is, cover all its costs - with a particular price
break even analysis
the change in total revenue that results from producing one more product
marginal revenue
the change in total cost that results from producing one more product
marginal cost
profit on the last unit sold
marginal profit
setting prices for a whole line of products
full line pricing
all costs are allocated to products, customers, or other categories
full cost approach
setting one price for a set of products
product bundling
setting prices on several related products as a group
complementary product
a seller who sets a price that all others in the industry follow
price leader
setting a few price levels for a product line and then marking all items at these prices
price lining
setting prices that have special appeal to target customers
psychological pricing
setting a rather high price to suggest high quality or high status
prestige price
trying to sell the whole market at one low price
penetration pricing policy
trying to sell the top of the market - the top of the demand curve - at a high price before aiming at more price-sensitive customers
skimming price policy
setting prices that end in certain numbers
odd-even
putting marketing plans into operation
implementation
What are the implementation tools?
- TQM
- Continuous Improvement
- Pareto Chart
- Fishbone Diagram
- Training
- Empowerment
- Benchmarking
the philosophy that everyone in the organization is concerned about quality, throughout all of the firm’s activities, to better serve the customer needs
TQM
a commitment to constantly make things better one step at a time
Continuous improvement
a graph that shows the number of times a problem cause occurs, with problem causes ordered from most frequent to least frequent
pareto chart
a visual aid that helps organize cause and effect relationships for “things gone wrong”
Fishbone diagram
giving employees the authority to correct a problem without first checking with management
Empowerment
What are the tools for control?
- Sales analysis
- Performance Analysis
- Performance Index
- Iceberg Principle
- Full Cost Approach
- Contribution Margin
- Market Audit
A detailed breakdown of a companies sales records
sales analysis
analysis that looks for exceptions or variations from planned performance
performance analysis
a number that shows the relation of one value to another
performance index
much good information is hidden in summary data
iceberg principle
a cost analysis in which all costs are not allocated in all situations
contribution margin
a systematic, critical, and unbiased review and appraisal of the basic objectives and policies of the marketing function and of the organization, methods, procedures, and people employed to implement the policies
market audit
the money invested in a firm
capital
money to pay for short-term expenses such as employee salaries, advertising, marketing research, inventory storing costs, and what the firm owes suppliers
working capital
borrowing money based on a promise to repay the loan, usually within a fixed time period and with a specific interest charge
debt financing
a financial report that forecasts how much cash will be available after paying expenses
cash flow statement
the ability to produce a certain quantity and quality of specific goods or services
production capacity
tailoring the principles of mass production to meet the unique needs of individual customers
mass customization
the categories to which various costs are charges in the normal financial accounting cycle
natural accounts
the categories to which various costs are charged to show the purpose for which expenditures are made
functional accounts
what a whole market segment might buy
market potential
an estimate of how much an industry or firm hopes to sell to a market segment
sales forecast
an approach to forecast sales by finding relation between the companies sales and some other factor
factor method
forecasting by combining the opinions of experienced executives, perhaps from marketing, production, finance, purchasing, and top management
jury of executive opinions
extends past experience to predict the future
trend extension