Sample Essay

Pricing strategies carry immense importance for a business as they are directly linked to the revenue generation for a business. In terms of taking over a cyber café in Hamilton, the pricing strategy must be cost effective strategy in which the business must be purchasing the resources of the cyber café in reduced prices. Furthermore in terms of charging the clients coming to use the internet service, the price charging strategy must be revised and renewed so that potential clients must be well aware that the cyber café has been taken over by the new owners and are highly willing of offer better service at more reasonable and affordable rates (Travis, 2007, p. 187).

Price is one of the factors which is considered by the customers whenever they make up their mind to purchase a product or a service. Therefore in taking over the running café in Hamilton, New Zealand, the investors must make sure that they adopt a pricing strategy that sounds attractive to the clients interested in using internet services (Reynolds, J, p. 109).
Cost based pricing or mark up pricing strategies can be the two strategies that can be adopted by the cyber café in order to operate successfully in its first few months after taking over the café. Cost based pricing aims at selling or providing services on cost to cost that is whatever cost is being incurred, the business aims to sell or offer the services at that price with no profit. This can be an attractive pricing policy to grab customers in first few months (Rich, 2008, p. 106).
The other strategy would be mark up pricing in which cost of the service would be covered plus some percentage of mark up would be added too so that the business manages to get some profit too since it is offering services to the clients.
So both the pricing strategies could be used respectively to ensure the results obtained for the cyber café are worthwhile.

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