100% satisfaction guarantee Immediately available after payment Both online and in PDF No strings attached
logo-home
MNE3701 Assignment 4 (ANSWERS) Semester 2 2024 - DUE 11 October 2024 R54,00
Add to cart

Exam (elaborations)

MNE3701 Assignment 4 (ANSWERS) Semester 2 2024 - DUE 11 October 2024

 6 views  0 purchase

MNE3701 Assignment 4 Semester 2 2024 - DUE 11 October 2024 ;100% TRUSTED workings with detailed Answers for A+ Grade. For assistance call or W.h.a.t.s.a.p.p us on +/ 2/ 5/ 4 /7 /7 /9 /5 /4 /0 /1 /3 /2 .

Preview 2 out of 9  pages

  • October 10, 2024
  • 9
  • 2024/2025
  • Exam (elaborations)
  • Questions & answers
book image

Book Title:

Author(s):

  • Edition:
  • ISBN:
  • Edition:
All documents for this subject (200)
avatar-seller
EduScript
MNE3701
ASSIGNMENT 4 SEMESTER 2 2024
UNIQUE NO.
DUE DATE: 11 OCTOBER 2024

, Question 1

Application of a Pricing System in a Café Business

Pricing is a critical component of the marketing mix, directly influencing a business’s
profitability and market positioning. In the context of a café business, implementing an
effective pricing system involves strategic consideration of various factors, including
costs, competition, customer perception, and market demand. This essay critically
discusses the application of a pricing system in a café, utilizing practical examples to
illustrate key concepts and strategies.

Cost-Based Pricing

One fundamental approach to pricing is cost-based pricing, which involves setting
prices based on the total cost of production plus a desired profit margin (Kotler & Keller,
2016). For a café, this entails calculating the cost of ingredients, labor, rent, utilities, and
other overheads. For instance, if the total cost to produce a cup of specialty coffee is £2,
and the café aims for a 50% profit margin, the selling price would be set at £3. This
method ensures that all costs are covered and a consistent profit margin is maintained.
However, it may not always reflect the market conditions or customer willingness to pay,
potentially leading to prices that are either too high or too low relative to competitors.

Value-Based Pricing

Contrastingly, value-based pricing focuses on the perceived value to the customer
rather than solely on costs (Nagle, Hogan & Zale, 2016). In a café setting, this approach
considers factors such as the quality of coffee, ambiance, customer service, and unique
offerings like organic or fair-trade products. For example, if customers perceive the café
as offering a superior experience, they may be willing to pay a premium price. This
strategy can enhance profitability and brand positioning but requires a deep

The benefits of buying summaries with Stuvia:

Guaranteed quality through customer reviews

Guaranteed quality through customer reviews

Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.

Quick and easy check-out

Quick and easy check-out

You can quickly pay through EFT, credit card or Stuvia-credit for the summaries. There is no membership needed.

Focus on what matters

Focus on what matters

Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!

Frequently asked questions

What do I get when I buy this document?

You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.

Satisfaction guarantee: how does it work?

Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.

Who am I buying this summary from?

Stuvia is a marketplace, so you are not buying this document from us, but from seller EduScript. Stuvia facilitates payment to the seller.

Will I be stuck with a subscription?

No, you only buy this summary for R54,00. You're not tied to anything after your purchase.

Can Stuvia be trusted?

4.6 stars on Google & Trustpilot (+1000 reviews)

52355 documents were sold in the last 30 days

Founded in 2010, the go-to place to buy summaries for 14 years now

Start selling
R54,00
  • (0)
Add to cart
Added