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- Publisher
- Emerald Publishing
- Copyright
- Copyright © 2004 Emerald Group Publishing Limited. All rights reserved.
- ISSN
- 1061-0421
- DOI
- 10.1108/10610420410560334
- Publisher site
- See Article on Publisher Site
Abstract
When considering a price decrease in response to competitive pressures or stagnating demand, management may ask how much additional volume must be sold at the new price to match the current profit level. This “iso‐profit” pricing problem has been studied extensively for single items manufactured using one resource. This paper solves three realistic extensions of the problem: when two or more items share a resource, when multiple items share multiple resources, and when resource vendors offer quantity discounts. Findings are summarized in 12 points, many of which are counterintuitive.
Journal
Journal of Product & Brand Management – Emerald Publishing
Published: Oct 1, 2004
Keywords: Breakeven analysis; Profit; Pricing; Promotional methods; Pricing policy