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Essay / Research Paper Abstract
This 6 page paper presents a pricing and distribution strategy for the launch of a new service providing oil change services for commercial vehicles. The strategies are presented, discussed and justified. The bibliography cites 4 sources.
Page Count:
6 pages (~225 words per page)
File: TS14_TEwynnbrice.rtf
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Unformatted sample text from the term paper:
Change LLC are setting up to provide oil and filter change services to fleet vehicles located in the Fredericksburg VA area. Targeting a range of commercial enterprises with a projection
that 70% revenues will come from the car rental business the firm has to develop a pricing and channel distribution strategy. 2. Pricing Strategy
When looking at the way pricing is to be set the target market and the product that is being sold, along with its stage in terms
of the product lifecycle. Wynnbrice are introducing new service, where this takes place there are two main pricing strategies that are likely to be considered; price skimming and price penetration.
Price skimming is where there is a high price set, with fewer units sold the idea is to regain the outlay as quickly as possible (Kotler and Keller, 2008). Trend
setters that are the mostly likely target market for a good in the introduction stage are also most likely to be prepared to spend more on a new product (Hooley
et al, 2007). This is most useful for products where there is a high level of differentiation and where early adopters in the market are prepared to pay a premium.
In the case of the oil change service this may be a new and differentiated service, but the level of differentiation is limited as there are acceptable alternatives, with services
that are already provided in other ways, such as the vehicle attending a nearby garage or in-house serving. This limits the potential for skimming, especially as the target market are
commercial enterprises which are likely to be very cost sensitive, answerable to owners or shareholders, issues such as cost benefit and efficiently are likely to be primary motivators, rather than
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