Demand, Cost and Price Adaptation

Demand, Cost and Price Adaptation

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Demand

Introducing a novel service such as self-service kiosks into a market that has not been tapped in the past can a be a very profitable undertaking. Such undertakings require one to have done proper research and has carefully identified the target group that would respond positively towards the new service. Through market research, the healthcare provider will be able to find out the latest trends, statistics, consumer’s purchasing power and competition. The data collected in help in choosing the best location to launch the new service. It is advisable to first test the waters for a new service and get feedback from the target group and this will help in achieving the experience you desired.

Cost

Setting a price for a service is another important decision to make. First, one should identify the benefits which the service provides and place a value to each of those benefits accordingly. Once analysis is done and value has been determined, the company can place the cost it would charge for delivering their service. For instance, consumers will not be willing to pay for a service without being convinced of its quality.

Price Adaptation

Making adjustments to a company’s pricing is not always an easy decision to make as it may be unfavorable to both the firm and its consumers but a situation might come up that requires adjustments to be made. For example, when competitors charge less for the same service and a lot customers prefer using their service. This would force the company to adjust its prices in order to attract customers as well. The government has a role to regulate prices, for example when it sets a minimum price for a particular service, it may impact negatively to the company’s sales if their prices were above the set standard.

References

Babalola, O. (2017). Journal of Health & Medical Economics. Consumers and Their Demand for Healthcare, 3(1)67-84.

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