Price

 In pricing Phileas’ Snake Skin Chips the pricing will take into account where the Chips will be sold. If the Chips are sold individual wrapped snack size then the pricing will be slightly higher than if the product is bought in one of the Big Box Stores, i.e. Costco, Sam’s Club where the product will be sold in bulk. “Today’s squeezed consumers are seeking greater value—just the right combination of good quality and service at a fair price. The distribution of income also is shifting. The rich have grown richer, the middle class has shrunk, and the poor have remained poor, leading to a two-tiered market”. (Pg. 95) Pricing of the snack food will take into account how the display of the product will occur and where the product will be sold.  World Market selling Phileas’ Snake Skin Chips will sell the chips at a higher price point that those who go to the big box stores and buy in bulk.  “Although costs are an important consideration in setting prices, cost-based pricing is often product driven. The company designs what it considers to be a good product, adds up the costs of making the product, and sets a price that covers costs plus a target profit. Marketing must then convince buyers that the product’s value at that price justifies its purchase. If the price turns out to be too high, the company must settle for lower markups or lower sales, both resulting in disappointing profits. Value-based pricing reverses this process. The company first assesses customer needs and value perceptions. It then sets its target price based on customer perceptions of value.” (Pg. 276) Buying in bulk generates a lower price point that buying items in individual snack size portions, so the advantage will go to the shopper who is price contentious and who may even be buying for a local coop where families who pull their purchasing power together are more apt to buy based products based on emotion and where they believe there is cost savings.  Phileas’ Snake Skin Chips found at the World Market, or Whole Foods will priced higher than those the Snake Chips found in the Big Box Stores.