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Adiministered pricing

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Vasudev Reddy

Administered pricing refers to prices set by the government rather than market forces of supply and demand. There are several ways governments implement administered pricing. First, prices may be set at some points in the supply chain and determined by the market at others. Second, only a portion of supply is priced administered with the rest trading freely. Third, revenues are pooled and distributed equally to farmers, indirectly influencing prices. Examples of administered pricing include taxing certain sectors, intervening in prices for smallholders but not plantations, or vice versa.

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WELCOME
K V A F S U K V A F S U Dairy science college MBA
TOPIC : ADMINISTERED PRICING Submitted by VASUDEVAREDDY. M.S.
Contents Reference conclusion Ways Definition Introduction
Introduction In many countries the price of food and some agricultural products are government controlled. Prices may be administered throughout the marketing chain or at a particular levels or points. Some pricing systems are combination of market determined and administered pricing
Definition The price of a good or service as dictated by a governmental or governing agency. (administered prices are not determined by regular market forces of supply and demand.) Administered prices as; Those which are imposed on the market by some external body, - Westlake.
Different ways of pricing system can be administered First.. Second.. Third..
First..... Prices may be administered at one or more points in the pricing system and determined by market forces at others. This system can lead to problems.
Second..... A second approach is to allow a proportion of the total supply of a commodity to be traded under a formal administered price structure while the reminder is traded informally . This occurs in case of staple food crops in many developing countries.
Third..... A third hybrid system is where a commodity is sold at market prices, but revenues are pooled before being disbursed to farmers. This system results in all farmers in the scheme receiving the same price. This system is termed revenue pooling and differs from other forms of administered pricing to the extent that, once the system is established, the government can only influence the price indirectly through, for example
For example The imposition of taxes and levies . Revenue pooling often results in the farmer receiving different prices from those at which his particular deliveries sell, the pooling removes the impact of short-term price instability. Lastly government interventions may be selectively applied to one sector of agriculture or another. For example, there may be intervention in the prices paid to small holders, but not to plantations or large estates, or vice versa.
Summary The task of pricing takes place a with in dynamic environment and so an organization must continually review its prices and the procedure employed in arriving at these prices. When making pricing decisions, marketers have to take in to account a range of factors. Internal factors include company marketing objectives, the marketing mix strategy and cost structure. External factors include, the state of marketing developed, and the pattern of supply and demand, the nature level of competition environmental considerations such as legal, political and economic events and social norms and trends.
Conclusion The supply and demand of any product will depends on the pricing decisions.
Reference Investopedia.htm Encyclopaedia Britannica.htm Notes
Thank you Reddy..

More Related Content

Adiministered pricing

  • 2. K V A F S U K V A F S U Dairy science college MBA
  • 3. TOPIC : ADMINISTERED PRICING Submitted by VASUDEVAREDDY. M.S.
  • 5. Introduction In many countries the price of food and some agricultural products are government controlled. Prices may be administered throughout the marketing chain or at a particular levels or points. Some pricing systems are combination of market determined and administered pricing
  • 6. Definition The price of a good or service as dictated by a governmental or governing agency. (administered prices are not determined by regular market forces of supply and demand.) Administered prices as; Those which are imposed on the market by some external body, - Westlake.
  • 7. Different ways of pricing system can be administered First.. Second.. Third..
  • 8. First..... Prices may be administered at one or more points in the pricing system and determined by market forces at others. This system can lead to problems.
  • 9. Second..... A second approach is to allow a proportion of the total supply of a commodity to be traded under a formal administered price structure while the reminder is traded informally . This occurs in case of staple food crops in many developing countries.
  • 10. Third..... A third hybrid system is where a commodity is sold at market prices, but revenues are pooled before being disbursed to farmers. This system results in all farmers in the scheme receiving the same price. This system is termed revenue pooling and differs from other forms of administered pricing to the extent that, once the system is established, the government can only influence the price indirectly through, for example
  • 11. For example The imposition of taxes and levies . Revenue pooling often results in the farmer receiving different prices from those at which his particular deliveries sell, the pooling removes the impact of short-term price instability. Lastly government interventions may be selectively applied to one sector of agriculture or another. For example, there may be intervention in the prices paid to small holders, but not to plantations or large estates, or vice versa.
  • 12. Summary The task of pricing takes place a with in dynamic environment and so an organization must continually review its prices and the procedure employed in arriving at these prices. When making pricing decisions, marketers have to take in to account a range of factors. Internal factors include company marketing objectives, the marketing mix strategy and cost structure. External factors include, the state of marketing developed, and the pattern of supply and demand, the nature level of competition environmental considerations such as legal, political and economic events and social norms and trends.
  • 13. Conclusion The supply and demand of any product will depends on the pricing decisions.

Editor's Notes

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