The Price Policy

The Price Policy

The Price Policy

Some products have long profit margins, others very short ones. In deciding upon a distribution policy, one must consider how much of the profit margin of the product one can afford to give to wholesale and retail distributors.

There is another and more potent aspect of the effect of one's pricing policy on the choice of distribution channel. Few manufacturers today wish to compete on price alone. In spite of the removal of resale price maintenance, most producers prefer to see their recommended resale prices maintained by distributors. This is easier to achieve when control of the distribution process remains in the hands of the manufacturer supplying direct to the retailer or direct to the consumer.




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