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When you visit different stores, you may notice that prices for the same goods vary. Why is this happening? What are the reasons for this? Let's figure it out.
To begin with, recall what price is. Price is a monetary expression of the value of the goods. In fact, this is money with which the buyer is ready to part with in exchange for the goods, and the seller of the goods is ready to part with him in exchange for the proposed amount of money. There are no absolute prices, and all of them are the result of certain agreements.
THREE COMPONENT PRICES
The price of any product is formed from several elements.
Firstly, this is the cost, that is, the cost of producing the goods. This includes the price of raw materials, the salary of workers, auxiliary materials, overhead costs, the cost of buying machines and equipment, its replacement (this is called "depreciation"). Plus, the manufacturer by law must pay taxes and deductions, which also affects the cost.
For example, before you get milk, you must first buy a cow. Then you need to organize a "house" for the cows - to build or buy a special dry, ventilated room. Next, purchase hay and feed, milking equipment, hire workers, pay them wages, organize the collection, storage and delivery of milk to the store and do many other important things. All this requires investments that affect the cost of goods.
Secondly, the producer lays profit in the price of the goods. Suppose you decide to sell photo frames. That there was a benefit, a sense from this venture, you will make an "extra charge". That is, at a cost of production of a framework of 100 rubles, you will sell it for 120 already. These same 20 rubles will be your extra charge.
But that is not all. If you sell photo frames through stores, then they will make a trade allowance. For example, for each frame a store can “throw” 70 rubles. As a result, the retail price for your product for the end customer will be 190 rubles.
WHAT ELSE MAY AFFECT THE PRICE OF THE GOODS?
In addition to these three factors, others can influence the price of a product.
Demand and value of goods. It's simple: the more valuable the product is in the eyes of the buyer, the higher the demand, the higher the price. Demand is influenced by many factors - region, seasonality and others. In the desert, a sip of water can cost 10 times more than a bottle of the same water in the city. Although the cost may be the same. On a hot summer day, the demand for ice cream is growing, respectively, many sellers are increasing prices.
Competition. The more manufacturers, the lower the price. And vice versa. In certain areas of production, there is only one seller, he is called a monopolist. For example, in many villages and villages of Russia there is only one state bank, one store. And the inhabitants of these villages are not able to receive services in other banks or goods in other stores.
In other industries, there are several sellers. Two or three, like the oil market, for example. This type of market is called oligopoly. In this case, the price of goods is “tough” and most likely rarely changes. The cost of goods depends on the type of competition.
The method of sale of goods. It is one thing when a manufacturer directly sells its products to stores. Another is if there are still links in the chain between the manufacturer and the seller. The more intermediaries, the more expensive the product for the consumer. After all, each intermediary will certainly make an allowance for their services.
Service. Delivery, packaging, installation, staff training, after-sales service - all this affects the price. It is clear that the more expensive the service, the more reasons for the price increase.
Advertising. For as many consumers as possible to find out about a product, you need a good advertisement that costs money, because you have to pay for every minute of airtime on TV or for a banner on a site. If famous actors, presenters, who have considerable fees, are attracted for advertising, its cost rises tenfold. All this affects the final price of the goods.
WHAT ARE PRICES
In general, prices are divided into three types. Wholesale - those for which enterprises sell their products in large quantities (in bulk) without the help of retail chains to other enterprises.
Retail - these are the prices that we see in stores. They include those allowances that we have already talked about. It happens that retail chains set different discounts on goods - sales, seasonal discounts, various promotions (“Buy two products, get the third as a gift” or “Second product at half price”).
There is a third type of price - purchase. At these prices, agricultural producers sell large quantities to the state and enterprises. You can save a lot by knowing how the price is formed.
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