geographical pricing

(redirected from Zone pricing)

geographical pricing

the PRICING of products to customers based in different locations. In some cases differential PRICES may be charged to reflect the respective costs of physical DISTRIBUTION involved in moving goods from the factory to the buyer.

In other cases firms may simplify their pricing arrangements by means of a ‘uniform delivered price system'which involves charging the same price to all customers irrespective of their location (for example post office letters). Alternatively, customers may be grouped into a number of delivery zones and a common price charged to all customers in each zone. Such ‘basing point price systems’ involve some cross-subsidization of delivery costs between customers in the interests of maximizing the firm's total sales. See PRICE DISCRIMINATION.

References in periodicals archive ?
If you do not like the terms dynamic or surge pricing, which can sound somewhat harsh, think of it as inventory or customer management, or maybe zone pricing on steroids.
It could be a promotional item or traffic driver, but more and more, it's likely a result of zone pricing.
That investment is beginning to pay off now in zone pricing and assortment clustering capabilities.
A food manufacturer we assisted recently reviewed its zone pricing system.
Given this finding and previous research into zone pricing, we conclude that a Connecticut ban on zone pricing would likely result in higher prices at the pump for the majority of the state and no drop in pump prices for the remaining areas.
To share the value proportionately with farmers in different areas, we use agronomic zone pricing.
Wyden's probe showed that the industry engages in zone pricing and discrimination against independently owned gas stations.
As for such pricing activity in America, it raises the question: Does zone pricing offer all consumers a level playing field?
MoviePass will be testing a Zone pricing model based on the average ticket price in a member's market.
HR: At Ace's last convention, you unveiled a new zone pricing structure.
The senior merchandising team that Simon put in place late last summer is uniformly dedicated to restoring SKUs, lowering prices, and eliminating such short-sighted practices as zone pricing and misplaced promotional initiatives, while the operating executives are committed to returning to the stores that cluttered and well-shopped look that announced bargains in every aisle and had customers routinely ransacking the shelves.
Fifth, optimize your zone pricing where possible to do so without being obvious to customers.