pricing

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Pricing

The process of an issuer determining the appropriate price of a new issue. That is, the issuer prices when it figures out what coupon rate to promise for a bond or price at which to issue a stock. This can be complex because pricing too far in one direction means the issue will not sell while too far in the other direction raises the cost of funds too high.

pricing

The determination of the price at which stock will sell or the yield at which bonds will sell as new issues. If the price is set too high or the yield is set too low, the issue will not sell out. If the price is set too low or the yield is set too high, the issuer will pay more than necessary in dilution or interest to sell it.

pricing

the decision-making process involved in setting a PRICE for a good or service. For most products, pricing decisions cannot be made in isolation but must consider all aspects of the MARKETING MIX, prices of the firm's related products, competitors'prices, product COSTS, DEMAND and the firm's PRICING OBJECTIVES. See PRICING POLICY, PRICING METHODS, PRICE-QUALITY TRADEOFF, BYPRODUCT PRICING, PRODUCT LINE PRICING, CAPTIVE PRODUCT PRICING, OPTIONAL EXTRAS PRICING, GEOGRAPHICAL PRICING, PSYCHOLOGICAL PRICING, BUNDLED PRICES, EVERYDAY LOW PRICES, PRODUCT POSITIONING, CONSUMER SURPLUS, VALUE CREATED MODEL.
References in periodicals archive ?
One manager described this level as "table-banging arguments whenever the topic of pricing comes up." At this stage there is no defined pricing strategy; pricing processes and reports are non-existent; high margin leakage occurs at every turn; and there is a lack of understanding about the price-value relationship.
This article highlights many of these pricing tools (with a strong focus on the Level 2 toolbox) that have proven to be highly effective as organizations progress along the path to pricing improvement.
According to an often-referenced study by Marn and Rosiello (1992), pricing is the most effective lever for increasing profitability--more so than managing cost and volume.
As an increasing number of boards of directors are realizing that a sound pricing process drives improved bottom-line results, there has been a corresponding increase in deployment of price audits to assess areas of improvement and opportunity.
More often than not, anecdotes and "gut feel" remain the key drivers for pricing decisions.