Pricing Exceptions

Michael Calogridis

Chapter Chapter 11 in Practical Pricing, 2010, pp 127-135 from Palgrave Macmillan

Abstract: Abstract Cost-plus pricing is a mechanism that is used for pricing products in certain industries, for the most part found in companies that do business with the U.S. Federal Government. For the majority of cost-plus contracts (sole source, firm fixed), the governmental entity will allow certain levels of profitability. Once overall profitability rises above the minimally accepted benchmarks, the government will require that the additional profit be returned to the government. The key in this cost-plus world is a strong “price to win” strategy whereby your costs are adequately pegged to the overall competitive marketplace and you can win deals (contracts) because of competitive bidding along with, hopefully, superior technology and serviceability.

Keywords: List Price; Large Customer; Price Leader; Competitive Threat; Exception Analysis (search for similar items in EconPapers)
Date: 2010
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Persistent link: https://EconPapers.repec.org/RePEc:pal:palchp:978-0-230-10234-7_11

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DOI: 10.1057/9780230102347_11

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