Product Service Pricing Strategies

Product Service Pricing
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Understanding the relationship between pricing strategies and new product services is important for any business professional. It allows him to have a better grasp of the competitive landscape of his industry and utilize strategic marketing techniques to improve its success. Accordingly, this article would focus on the pricing strategy that could be used for the new product service – self-service kiosks for the blind. This is includes the rationale and the causes for such service. All in all, the author believes that the price points for the service is crucial in order to improve competitiveness within the same industry, while also leveraging other modes of cash flow for the business.
Pricing Strategies
Hardware and Software
The self-service kiosk for this company would include a digital and personal service, which should both be considered in pricing the service. On the one hand, the self-service kiosk itself would cost around $7,800 per machine, which is only a little bit higher compared to the kiosks technologies provided by its competitors (Zamok.com, 2021). This price per unit includes the hardware, software, and additional staff training for those who would assist the clients. First, the hardware pricing includes every piece of material together with the assembly and setup processes. Based from recent estimates, self service kiosks assembly and mnufacturing usually costs around $8,000 although suppliers indicate that bulk orders of around 50 units and above reduces the price per unit to $5,000 (Papandrea, 2019). Second, the software that would be utilized is in partnership with Advance Kiosks Softwares that are ran by Zamok Industries. Zamok softwares provide one of the best and most affordable software especially considering the amount of functionalities that it already has VOIP, reports and surveys, weekly status reports, among others. The enterprise package isalready priced for about $800 to $1000 per unit where it would be installed, but if done in a large scale, their website reports that we can get as much as a 7% to 15% discount for each unit (Zamok.com, 2021). This translates to millions of dollars in savings considering that the self-service kiosks are intended to service 11,500 Walmart stores in the long run.
All in all, both the software ($1000) and the hardware ($5000) costs means that the cost for each unit is about $6,000. Thus, assuming that a 30% profit margins is intended...