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Welcome on board to Orkin Pest Control?s midwest sales management team

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Question;Welcome on board to Orkin Pest Control?s midwest sales management team. I would like you to analyze our current pricing scheme on our basic, monthly residential home pest control services in our representative mid-size market and give me a recommendation on how we can increase our monthly sales by 20% on this product arm. We have been successful at up-selling customers to our premium service, so we would like to attract a fresh batch of customers to our basic service in the next month.Our sales department has estimated the following monthly demand for our basic service: Qd=95-4POR+5PTER where the demand for our monthly treatments does depend on the price of our only competitor in the market: Terminix. Currently Terminix is pricing their service at PTER=$65, while we are pricing our service at POR=$70.We are thinking about cutting our price by $5 to match our competitor?s price and achieve our desired sales increase, but I am willing to drop below Terminix?s price by offering a $10 price cut on our service. What are your thoughts on the matter?

 

Paper#60526 | Written in 18-Jul-2015

Price : $22
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